Every day women are starting new businesses in every corner of this country. Like any other business owner, female business-owners grapple with many decisions to ensure success. They ask themselves the same questions as their male counterparts: Do I have the right product? Am I balancing the right revenue sharing? Did I learn enough in school? Despite the difficult economic climate during the recent recession, women-owned businesses performed just as well as men-owned businesses during the period 2007 – 2010, and in many cases outperformed their peers.
This week the National Women’s Business Council (NWBC), released newly analyzed data demonstrating that although women-owned businesses are doing well, they tend to struggle with some of the key obstacles in growing their businesses. Some of those struggles are within the basics of business development – business performance, revenue distribution and industry participation.
One of the glaring challenges in the data shows that while it is clear that women are the fastest growing segment of entrepreneurs, challenges persist in growing in size (revenues) and gaining market share to compete equally with their male counterparts. In fact, this data shows that women-owned businesses tend to be overly-present in low-income industries and disproportionately absent in high-income industries.
It’s also interesting to note that education does not necessarily improve success in business for women. Overall, slightly fewer women business owners had a bachelor’s degree than men business owners. Having an advanced degree is noticeably not a requirement for success in business as many industries have less than half of their owners with a degree. Among those industries that do have owners with the highest levels of education, the industries dominated by women-owned businesses rank in the top three, with over 80% of owners having at least a bachelor’s degree. Despite these higher levels of education, women-owned firms do not have the same outcomes in higher revenues as men-owned firms across almost every industry.
Addressing the possible reasons behind this revenue gap is an area in which NWBC is currently analyzing and will be releasing findings as part of this infographic series throughout the summer.
Another important revelation in data is the age gap among women business owners. Women-owned businesses tend to have younger owners than businesses owned by men, or equally owned by women. Self-employed businesses also tend to have younger owners than employer firms, where less than 10% of owners are under the age of 35. And with little mentorship of women at executive levels, this gap is an important one to be evaluated.
Although the glass ceiling continues to be prevalent in our economy for many women, there is good news. Today’s analysis shows that women-owned businesses lost a smaller share of jobs than their male counterparts during the recession. This shows that as women-owned businesses expand, they are doing so in a way that maintains the broader economic impact of job creation. This, as well as stories of women entrepreneurs and business owners such as National Women’s Business Council members Lisa Price, Sarah Fisher, Kimberly Blackwell and others who continue to flourish, demonstrate that women-owned businesses make a real difference in our economy.