March is Women’s History Month, a celebration of the achievements of women who have made an enduring mark on our society and helped shape American history. This is a time to honor women who have made significant strides and brought about great change, including in the world of small business where never before in American history have women been so well-represented.
Small-business ownership was once dominated by men, but that is rapidly changing as more and more women are becoming small-business entrepreneurs. In fact, according to the Institute of Women’s Policy Research (IWPR), women are steadily increasing their presence in the realm of business, with approximately 29 percent of America’s business owners being women. The number of women-owned small businesses has grown 68 percent since 2007, compared with 47 percent for all businesses. Furthermore, the Guardian Small Business Research Institute projects that women-owned businesses will generate 5 million new jobs by the year 2018.
Minority women, in particular, have made monumental progress, which is illustrated by the fact that business ownership by minority women has risen 265 percent since 1997. Additionally, minority women comprise one in three female-owned businesses, up from only one in six less than two decades ago. This growth has been especially exponential among black and Hispanic women, who currently comprise 14 and 11 percent, respectively, of total women-owned businesses. Part of the reason for this growth is due to The Small Business Jobs Act of 2010 and the Women’s Equity in Contracting Act, of which the goal of both is to assist businesses owned by women to obtain more government contracts.
However, women who own small businesses still face inequalities. For example, they experience a significant wage gap and generate smaller amounts of startup capital than business owners that are men. Women-owned businesses make approximately 25 cents for every dollar earned by their male counterparts, which again can be attributed to insufficient startup funds, as well as less-than-favorable loan terms due to women-owned businesses often being smaller than male-owned businesses.
However, there still exist many positive factors spurring the growth of female-owned small businesses, including the fact that the cost of launching a business and promotional costs have dropped significantly, which is due in no small part to digital marketing and social media. Furthermore, many small businesses can be run from home, which allows business owners, whether they be a man or woman, to still take care of family obligations, such as the raising of children.
Women is small business today are more empowered and optimistic than ever. In fact, in an Allstate/USA Today Small Business Barometer, a study used to gauge the health and vitality of America’s small-business sector, women’s optimism scored an 85, or excellent, compared to a 74, or strong, for men. This excellent optimism translates to more than 10 million women-owned businesses in the United States, with approximately 1,200 new ones started daily. Women in small business are making history every day.