By Sarah Gonzalez Bocinski and Alona Del Rosario
Women-Owned Businesses in the United States
In United States in 2012, 35.8 percent of businesses were women-owned compared with 53.7 percent that were men-owned, the remaining 10.5 percent or jointly or publicly owned. While the proportion of businesses owned by women has steadily increased, the proportion of women-owned businesses has remained stagnant at four percent. Approximately 90 percent (89.5 percent) of women-owned businesses are sole proprietorships, with women of color having even higher rates of ownership of non-employer firms.
Economic Empowerment Spotlight
A 2016 American Express OPEN Small Business Monitor survey found women-owned firms that generate an income reported average annual earnings of $63,590. While only a fraction of women business owners report earnings, those earnings exceed the 2015 median annual income for full-time working women of $39,900. Further, women who are established business owners report higher levels of well-being than women who are not entrepreneurs.
Many women-owned businesses are concentrated in industries that tend to employ more women than men. For example, 61 percent of health care and education firms are women-owned, but women own only 35 percent of businesses in professional, scientific, and technical services; 32 percent in finance, insurance, and real estate; 25 percent in manufacturing; and 14 percent in transportation and warehousing, all traditionally male-dominated industries.
Women’s entrepreneurship also varies greatly from state to state. The District of Columbia, Maryland, New Mexico, Hawaii, and Georgia have the highest shares of women-owned businesses, while South Dakota, Idaho, Arkansas, Montana, and North Dakota have the lowest. For more information on women’s business ownership in your state go to IWPR’s Status of Women in the States website.
Obstacles for Women Entrepreneurs
Women entrepreneurs may encounter significant obstacles to developing successful businesses. Research indicates that women have less access than men to business counseling and training, fewer opportunities to build networks and work with mentors, and less access to capital. Historically marginalized and underserved populations face the additional challenges of racial discrimination and stereotyping in the labor market.
Women’s entrepreneurship has grown in recent years. From 1987 to 2013, women-led small businesses grew from 4.1 to 8.6 million in the United States according to a 2014 Majority Report of the U.S. Senate Committee on Small Business and Entrepreneurship. While women-owned businesses have been growing quickly, women of color, Black and Latina women in particular, represent the fastest growing segments of the small business community. Since 1997, the number and share of firms owned by women of color has nearly doubled, from 17 percent of women-owned firms in 1997 to 32 percent in 2014, with African American women-owned businesses having increased by an estimated 296 percent.
Supporting Entrepreneurial Survivors
Like many women entrepreneurs, survivors of sexual and domestic violence often face many misconceptions about their strength, ability, and resilience. When it comes to the day-to-day reality of living with and/or managing a relationship with an abusive partner, however, many advocates suggest that survivors employ the same skills exhibited by the most successful CEOs–calculated risk taking, thoughtful action, tough-mindedness, the ability to read people, problem solving, and determination.
Survivors may face additional obstacles to starting a business as a result of years of economic abuse. Abusive tactics that damage credit, deplete resources, and prevent completing education and training put survivors at a disadvantage by limiting their personal and social capital. These challenges can be exacerbated by additional obstacles, such as the immediate and long-term effects of trauma, legal issues, and ongoing threats of violence.
Growing interest in entrepreneurship as a pathway to economic security and independence has led some domestic violence programs to develop trauma-informed business development programs that provide an array of supports such as small grants or loans, training and education, business planning, networking and mentorship, while providing supportive counseling and advocacy. Alternatively, some programs may build partnerships with business development agencies can help provide survivors with guidance and support. Whatever the approach, being mindful of survivors’ safety needs, addressing impacts of abuse and trauma, and taking steps to mitigate the risks, must be priorities.
This project was supported by Grant No. 2014-TA-AX-K433 awarded by the Office on Violence Against Women, U.S. Department of Justice. The opinions, findings, conclusions, and recommendations expressed in this publication are those of the author(s) and do not necessarily reflect the views of the Department of Justice, Office on Violence Against Women.