For decades now, it’s been a game of catch-up for women in business—and they’ve gained a lot of ground. Since 2007, the number of women-owned firms has grown five times faster than the national average, according to the 2016 State of Women-Owned Business Report. In fact, women are now three times as likely to start their own businesses as men, and that number is on the rise.
Lendio recently released an infographic showing the growth of women entrepreneurs through the years. The data reveals the economic impact of women in small business over the last decade by revenue, employment and post-recession growth. According to the numbers, women are making big strides in small business:
Growth of Women in Small Business
- The number of women-owned businesses has increased 45 percent since 2007, compared to a 9-percent increase among all businesses.
- Women are now majority owners in at least 38 percent of U.S. small businesses.
- There are 11.3 million women-owned businesses in the U.S.
- Women in small business generate more than $1.6 trillion in revenue annually.
- Women-owned businesses employ nearly 9 million people in the U.S.
- Employment in women-owned businesses has increased 18 percent post-recession (employment has declined 1% among all small businesses).
- Revenue growth among women-owned firms has increased by 35 percent since 2007 (30 percent higher than the national average).
While these numbers show that females are reaching new heights in the small business world, other statistics reveal that the glass ceiling hasn’t shattered. Several studies show a gender gap between male- and female-owned businesses when it comes to small business financing, with women trailing men in revenues and earnings, credit scores and average loan size.
Disparities in Male- and Female-Owned Small Businesses
- On average, female business owners ask for less funding, about $35,000 less than their male counterparts.
- Women business owners make multiple attempts to secure bank loans or lines of credit, and 40 percent of women business owners applying for a loan never succeed in obtaining funding.
- Loans to women make up about 4 percent of all commercial loan dollars.
- Women-owned businesses have a 21-percent lower chance of getting a federal contract than their male counterparts.
- In 2015, the government met its goal of awarding at least 5 percent ($17.8 billion) of its contracts to women-owned businesses—an endeavor that’s been over 20 years in the making—though it’s a small portion of the $90.7 billion in government contracts that went to small businesses.
As the Lendio infographic demonstrates, women entrepreneurs are making an impact on the U.S. economy. In order to further that growth and narrow the existing gender gap, several organizations have rallied around women in small business, forming programs, initiatives and legislation in support of female small business owners.
Last month, Women Impacting Public Policy released its 2017 Economic Blueprint, calling on Congress to prioritize policies that help women entrepreneurs succeed. The Blueprint calls for significant changes and improvements in access to capital for women, including offering tax incentives to angel investors and recalculating the way credit scores and employment history are evaluated for women seeking funding.