The private sector is one of the keys to global economic development. When it comes to job creation and contribution to the global income, the private sector takes the lead. It has had a record of creating 90% of employment opportunities in the developed world as we as delivering high-end goods and services to the society. With its rampant growth, the private sector is likely to take over urban development with the capability to moderate the challenges that come along with rapid urban development. Below is a discussion on the importance of the private sector.
Importance of the private sector
Improvement of infrastructure
Through the public, private partnerships, the private sector aids remarkably in the development of infrastructure in the society. With PPPs, the government can provide the public with beneficial public assets whose risks and responsibilities are laid upon the private sector. The PPPs in conjunction with private sector provide room for the government to procure public infrastructure development using the expertise and resources provided by the informal sector.
The private sectors bring along standardization in the industrial world, which is key for the effectiveness of any company. When a company is actively a part of standardization, they get to generate ideas and technologies that are up to standard. The standardized market also gives a company an opportunity to interact with specialists in other fields as well as becoming aware of their potential competitors. Note that this process does not require the company to incur many costs regarding travel or participation. Moreover, note that the benefit the company reaps from standardization is much more compared to the costs involved.
With many young people succeeding in their careers and flooding in the marketplace looking for jobs, the government jobs may not be enough for all of them. For that reason you find that most of them are left jobless, which may pave the way for poverty in the society. However, the private sector is dominant in the employment creation sectors steps a big deal into solving this problem. It provides jobs for many youths in pursuit of advancing their careers in the marketplace, in turn, eliminating poverty in our world.
Provides strategic planning processes
The private sector is capable of providing any cities with rapid urban development with strategic planning processes to help them withstand the many challenges that come with it. For this to occur the municipalities need to corporate with the private sector to provide them with technical training and managerial skills to help them develop their managerial capability of the urban areas.
In most countries, the private sector is the one that mainly provides goods and services to the community. For that reason, any development initiatives should play the role of supporting the growth of the informal sector and eliminating all the regulations that limit the development of this sector. However, while supporting the informal sector to continue curbing poverty in the society, it is important to put in place the necessary social protection in place.