Introduction
Over the years, there has been a notable increase in women entrepreneurs worldwide, especially in America. The rise in women entrepreneurship in America can be attributed to the loss of jobs, pay inequalities, and lack of resources for working mothers.
History related to Women Entrepreneurs
There are many successful women entrepreneurs in the United States and the rest of the world. Notable female entrepreneurs include Sara Blakely, Oprah Winfrey, Nadia Masri, Alexandra Andersen, Áslaug Magnúsdóttir, Rihanna and Sheryl Sanberg.
Oprah Winfrey is a media mogul, talk show host, actress, and philanthropist. She uses her platform to empower women around the world. Another example is Áslaug Magnúsdóttir who is the co-founder and CEO of Swiss online fashion retailer Moda Operandi, who also has was a former model and corporate attorney.
While these few women are known worldwide for their entrepreneurial prowess and success. More female entrepreneurs are breaking barriers and establishing successful businesses.
Statistics from the U.S Census Data
Below are statistics from the U.S census data on the current state of women entrepreneurs in America.
- 252 million of the 582 million entrepreneurs worldwide are female.
- In the past 20 years, there has been an increase in women-owned businesses by 114%.
- Women start about 1,200 new businesses in the US daily.
- Women own about 43% of small businesses in the US, either fully or partially (about 14 million companies)
- Women-owned businesses employ about 9 million people and generate about $1.8 trillion per year for the US economy.
- In the US, 1 in 3 women-owned businesses is owned by a mother.
- 17% of black women are starting or actively running a business. An impressive statistic compared to 10% of white women who are starting/running a business
statistics on the current state of women entrepreneurs in America.
- 62% of women business owners are between 40 and 59 years old
- Women of color started 89% of newly created businesses in 2019, despite composing only 39% of the US population.
- Hispanic women-owned businesses increased by 172% in the last decade.
- Black women-owned businesses rose by 518% between 1997 and 2016.
- Black women are the only ethnic race with more businesses than men, accounting for over 2.5 million businesses.
- African American women control around 45% of women-owned businesses in the United States.
Topmost Countries for Women Entrepreneurs
According to the NECI (National Entrepreneurship Context Index) scores, the best countries for entrepreneurs in 2022 include the United Arab Emirates, the Netherlands, and Finland.
New Zealand also has favorable entrepreneurial supporting conditions, explaining why its women have consistently topped the MasterCard Index of Women Entrepreneurs (MIWE) with a 70.1 score.
These top countries for women entrepreneurs provide women with resources for starting businesses, enabling government ecosystem and policies, and have established business networks compared to other countries.
Several countries are taking the initiative to support female entrepreneurs through policy enactment and providing an enabling environment.
These include Canada, the United States, Australia, and the United Kingdom.
Factors Contributing to the Increase of Women Entrepreneurs
Loss of Jobs
The Covid-19 pandemic brought a massive loss of jobs in America and worldwide. Women were the most affected, losing close to 6 million. The most affected were women of color; blacks, Hispanics, and Asians.
Most work in sectors offering low wages, fewer benefits, and low job security. In 2020 alone, in the U.S. specifically, women made up 64% of the low-wage jobs workforce. These jobs that pay less than $12 an hour include waitresses, clerks, childcare workers, and cashiers.
As businesses closed down, these women found themselves without work and had to be entrepreneurs out of necessity.
Wage Pay Gap
Although the US has come a long way in addressing the gender wage gap since the equal pay act of 1963, there is still much work to do.
Statistics from the US Census data show women consistently earn 30% less than men in 2020. The pay gap increases with age. Educating women has failed to address this gap. As women receive less pay than similarly educated men at every level.
For instance, women in their first year in engineering and computer science jobs earn $4000 less than men, despite having the same degrees and same grade points. In a bid to reduce inequalities, women are taking matters into their own hands and entering the business world as entrepreneurs and founders.
Lack of resources for working mothers
In most family set-ups, women are the primary caregivers for their children. However, with schools closing in the wake of the Covid-19 pandemic, most have been forced to quit their jobs to care for their children.
According to a report published by the State of Motherhood, lack of affordable childcare was the top reason mothers left their workplaces in 2021. The survey also found that over half of working mothers said they have contemplated leaving work at least once recently because of the stress and financial burden resulting from seeking reliable healthcare for their children.
Aside from childcare challenges, working mothers also face a lack of resources, such as rigid working arrangements and discrimination in hiring due to pandemic-era gaps in their resumes, among other issues.
Entrepreneurship allows women to take control of their schedule and create jobs for themselves to enable them to make ends meet while still taking care of their families.
A survey of 4,000 online microbusinesses in the US by venture forward shows that since March 2020, women have started 57% of online businesses, an increase from 47% the year before.
More women are viewing entrepreneurship as an alternative to the demands of corporate life. For them, it is a way to achieve financial security, autonomy, and flexibility in their lives.
Factors that contribute to the growth of Women’s Entrepreneurs
Numerous factors play a role in the growth of women’s entrepreneurship. These factors include cultural norms, access to resources, government policies, and educational opportunities.
The government policies control the field of entrepreneurship by creating an excellent conducive environment to promote business.
For example, government funding for entrepreneurs through the creation of loan schemes that enable women to access low capital creates opportunities for them to start and grow their businesses. In addition, the creation of business incubators and accelerators supports the growth of women’s entrepreneurship.
Cultural norms create a social environment for entrepreneurs. For instance, if women are socialized to believe that business success is achievable, then they are likely to start a business and grow. In addition, the exposure enables the women to utilize available resources and enrich their business.
Moreover, educational opportunities provide women with the skills and knowledge necessary to start and run their businesses. This plays a role in women’s entrepreneurship as they pool resources to run a lucrative business.
An example of such an educational program is the Academy for Women Entrepreneurs (AWE). AWE has trained and provided network and resources to more than 16,000 women in 80 countries from all over the world, 18 of them from sub-Saharan Africa.
The internet and social media are other factors that support women’s innovations and inventions. The internet acts as an equilibrium field for women to start their businesses. In the past decade, women had less access to resources and networking opportunities than men.
However, with the internet and social media platforms, women can connect with entrepreneurs in society and find mentors and funding more easily. In addition, the technology creates a global audience for women to start and run online businesses.
Conclusion
So, what does the future look like for women entrepreneurs?
First, the number of women in business will keep increasing. This will break the monotony of men leading in the industry, thus paving the way for future women entrepreneurs. The gender gap will keep decreasing as more women get the same opportunities as men to pursue their dreams and aspirations.
Moreover, the increase of women-owned businesses brings healthy competition in entrepreneurship which results in innovation and better products and services.
Therefore, expect to see more women-owned businesses in the United States and the rest of the world as governments and other organizations support products and services specifically designed by women.