Marking National Women’s Minimum Work Month: What the data says


Season a Twitter Spaces discussion Two panelists hosted by the bipartisan Policy Center (BPC) and the American Chamber of Commerce yesterday to celebrate National Women’s Small Business Month noted that the challenges facing women business owners are “unique.”

“Women business owners often have to juggle multiple responsibilities related to child care and parenting,” said Holly Wade, executive director of the National Independent Business Federation Research Center. Her observation was echoed by other participants; The nature of those unique challenges is reflected in the data on women-owned businesses.

Over the past few weeks, the BPC has published statistics showing various dimensions of the state of female business ownership. Here, as National Women’s Small Business Month draws to a close, is a collection of additional data on women’s entrepreneurship trends and where they’re headed.

Young but low entry?

According to data from the Census Bureau’s Annual Business Survey (ABS), a quarter of women-owned employers have been in business for at least 16 years. It is the oldest age group tracked in the survey. For men, the proportion is 34 percent. In other words, three out of four women’s employers have started working at less than 15 years of age.

At the same time, The amount of new entrepreneurs Census data tracked by the Kauffman Foundation is consistently higher for men, and the gap is not closing. The average rate among women rose from 0.23% (230 new entrepreneurs per 100,000) during the period 1996-2014 to 0.26%. Women registered the highest rate in 2020 at 0.30 percent. However, the gap with men has not disappeared and is even slightly widening. In the 1996-2014 time frame, the average gap was 0.14 percentage points. This rose to 0.16 percentage points from 2015 to 2021. At a glance, that’s a small difference, but it translates into 20 more new entrepreneurs per 100,000 men every year over a seven-year period. In total, it spreads over 100 million men in the United States, and this is a wide gap.

These data points present a contradictory picture: Women-owned firms are generally smaller and smaller than those owned by men—yet women have lower levels of entrepreneurship. It is always dangerous to combine data sets (even in the same statistical office!) but this may indicate that healthy new female entrepreneurs can move to the employer level. (The year The amount of new entrepreneurs It covers both employers and employees.)

Women are more likely to find non-employer organizations than men. 21 percent of employers are owned by women, while 42 percent are non-employers. The share of male-owned firms with more than 100 employees is nearly double that of female-owned firms.

These differences are important because employers continue to report financial challenges related to the pandemic at a faster rate than employers, and most have not seen revenues return to pre-pandemic levels. In general, non-employer organizations are less likely to receive their financial applications from employer organizations.

Constant financial gaps

Employer-employer differences may be part of the explanation for the financial gap between male and female business owners. In the year In 2020, during the Covid-19 pandemic, 69 percent of women-owned businesses received less than $100,000 in government support. Meanwhile, 38 percent of male-owned businesses received more than $100,000 in government aid, compared to 31 percent of women-owned businesses.

That may be a matter of demand—if women-owned firms are smaller and younger, they may want smaller amounts of financing. In its most recent study of women-owned businesses, Biz2Credit found a wide gap in average revenue and average loan size between male- and female-owned firms. In 2021, women received slightly higher credit applications and their average loan amount was 34 percent higher. However, loans received by male-owned firms were 67 percent higher in 2021, a much larger gap than in 2020 (when they were 33 percent higher).

“Reason for Optimism.”

During the Twitter space discussion, all participants expressed their hopes for the future of women business ownership. That’s part of starting and running a business: “Women business owners are naturally optimistic,” says business owner Sandy Clitter of the National Association of Women Business Owners. Other speakers pointed to higher rates of overall business creation led by women, as well as the pandemic-motivated increase in digital adoption among small businesses.

Addressing the “unique challenges” faced by women business owners and future female entrepreneurs is a priority if the hope is to shift to business growth and job creation. Time, as Wade and Clitter both point out, is a scarce resource for any business owner—especially for additional needs like maintenance. Challenges in technology adoption, compliance with government paperwork and other areas include time constraints. So if there is a place of great benefit to helping female business owners and future entrepreneurs, it may be to find ways to ease the burden of time. It sounds wonderful (who doesn’t want more time?), but this can be done in areas such as supporting paid vacations, reducing childcare and bureaucratic burdens, using independent contractors, and (when necessary) government contracting.





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