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Contact: Rhylee Jones, Public Affairs Specialist

National Women’s Business Council (NWBC)

Phone: 202-735-4342

Email: rhylee.jones@sba.gov

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National Women’s Business Council (NWBC) Unveils Latest Research Report on Women’s STEM Entrepreneurship

Washington, D.C., (November 25, 2024) – The National Women’s Business Council (NWBC) proudly releases its latest research report, Engineering Change: A Blueprint for Strengthening Women’s STEM Entrepreneurship, which provides a comprehensive examination of women’s entrepreneurial engagement in high-growth, high-yield STEM industries. Conducted by KEEE, LLC, the research aims to identify critical factors influencing women-led STEM businesses and offers insight into both systemic challenges and unique opportunities for growth.

“Women’s entrepreneurship in STEM is essential not only for economic growth but for building a more inclusive and innovative future,” said Sima Ladjevardian, Chair of the NWBC. “This report highlights where we need to focus our efforts to support women entrepreneurs in STEM fields, helping them overcome barriers and fully realize their potential.”

Engineering Change builds upon the findings of an earlier NWBC report, An Illuminating Moment: Lighting a Pathway for Women STEM Entrepreneurs, with new, data-driven perspectives on women-owned businesses from 2012 to 2020. KEEE, LLC analyzed U.S. Census Bureau data to assess the landscape of women’s STEM entrepreneurship, revealing several pivotal trends:

Concentration in Key Sectors: Women-owned STEM firms are highly concentrated in professional and healthcare sectors, demonstrating a positive correlation with the number of female patentees, levels of venture capital funding directed toward women-founded businesses, and an expanding labor force. Notably:

• A 1% increase in women patentees correlates with a 0.56% rise in female STEM entrepreneurs.
• A 1% rise in venture capital funding for women-founded firms produces a 0.29% increase in these entrepreneurs.
• A 1% labor force expansion is linked to a 37% increase in women STEM entrepreneurs.

Interest Rate Sensitivity: Higher interest rates tend to modestly reduce female STEM entrepreneurship; a 1% rate increase leads to a 0.08% decrease, a reflection of the lower capital requirements typical of non-employer firms, which are less affected by borrowing costs.

Income and Career Choice Dynamics: Interestingly, as per-capita income rises, women’s STEM entrepreneurship declines— a 1% increase in income leads to a nearly 3% drop in women STEM entrepreneurs. The report suggests that higher incomes may shift women’s focus toward family or conventional employment over entrepreneurship, with good job prospects potentially reducing the incentive to launch businesses.

STEM Education and Business Ownership Disconnect: Paradoxically, an increase in female STEM graduates correlates with a decline in female STEM entrepreneurship across diverse sectors. A 1% rise in STEM graduates leads to a 9.9% decrease in business ownership among women, indicating that many highly educated women may prefer careers in academia or established industries over entrepreneurship.

COVID-19 Impact: The pandemic catalyzed growth in female STEM entrepreneurship, driven by new healthcare sector opportunities, increased support through community funding, direct cash payments to families, and economic necessity.

Ethnic and Racial Disparities: The report highlights substantial disparities among women of different racial and ethnic backgrounds. For instance, a 1% increase in STEM graduates results in significant declines in firm ownership for Black (31% decline), AIAN (240% decline), Asian (45% decline), and Latina women (32.6% decline). However, Black, Hispanic, and Asian women-owned STEM firms show more positive responses to increased patentee numbers and venture capital funding than their white and non-Hispanic counterparts.

While this analysis reveals complex dynamics between women’s STEM education and entrepreneurship, it underscores an urgent need to address structural barriers in high-growth fields. As Ladjevardian states, “Engineering Change brings to light the factors impacting women’s participation and success in STEM entrepreneurship. This research arms policymakers and stakeholders with critical data to design programs that foster inclusivity and opportunity for women across all racial and ethnic backgrounds in STEM.”

This research emphasizes the value of supporting women’s STEM entrepreneurship and calls for enhanced mentorship, role models, and equitable access to venture capital. It advocates for reforms that align educational outcomes with entrepreneurial opportunity, ensuring women have the resources and support to succeed in high-growth sectors.

To download the full report from our website, please click here. For more information about this report, please contact Erin Hustings at erin.hustings@sba.gov.

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About the National Women’s Business Council

The National Women’s Business Council (NWBC) is a non-partisan federal advisory committee created to serve as an independent source of advice and counsel to the President, Congress, and the U.S. Small Business Administration on economic issues of importance to women business owners. To learn more, please visit: www.nwbc.gov.