Report finds women-owned firms making headway
Locally, GROW has helped approximately 600 women entrepreneurs in the last year.
Behind the economy of every great state, there’s an even greater growth of women-owned businesses.
Women-owned firms are stronger than ever, especially in Michigan, according to the sixth annual State of Women-Owned Businesses Report, a comprehensive report that was commissioned by American Express OPEN. The report analyzes data from the U.S. Census Bureau’s Survey of Business Owners and factors in relative changes in gross domestic product.
According to the report, women are the majority owners in 38 percent of U.S. businesses, up from 29 percent in 2007. The number of women-owned firms in 2002 was 6,489,483. In 2007, that number rose to 7,793,139, and in 2012, it rose again to 9,878,397. This year it’s 11,313,900.
Sales figures also are rising, from $940,774,986 in 2002 to $1,622,763,800 this year.
“Between 2007 and 2016, the number of women-owned firms increased by 45 percent, compared to just a 9 percent increase among all businesses. Therefore, over the past nine years, the number of women-owned firms has grown at a rate fully five times faster than the national average,” the report read.
“Comparative employment growth is even stronger. Employment in women-owned businesses has increased by 18 percent since the recession, while among all businesses, employment has declined 1 percent since 2007. Business revenues among women-owned firms have increased by 35 percent since 2007, compared to 27 percent among all U.S. firms — thus at a rate that is 30 percent higher than the national average.”
Michigan ranked fourth among states for the increase in numbers of women-owned firms, and 10th for revenue growth between 2007 and 2016.
The report reveals women business owners in Michigan are making a significant difference in the state’s economic recovery, said Bonnie Nawara, CEO of Grand Rapids Opportunities for Women. She said it’s impressive that the estimated sales for women-owned businesses in Michigan in 2016 are $46,130,800, which is a 49 percent increase since 2007.
It’s also a clear sign the business climate here is becoming more supportive of women entrepreneurs, she said, adding that, last year, GROW worked with approximately 600 entrepreneurs through its training, counseling and micro-lending programs.
“To us, it is important that we deepen our outreach and create new programs — delivering skills to raise revenue levels, create new opportunities for connectedness and help build a stronger community to foster business growth. GROW wants to work to open doors so that all women entrepreneurs are empowered to achieve success,” Nawara said.
“Women entrepreneurs, especially here in West Michigan, should be proud of the work they have done and the ways in which they have contributed to the economic health and vibrancy of our community. West Michigan is full of smart, talented, driven women who have built — and will continue to build — great businesses here, and GROW is here to help them at every step, from concept to company.”
What surprised Nawara was that nearly eight of every 10 new women-owned firms launched since 2007 has been started by a woman of color. Minority women-owned businesses have a unique struggle, she said.
“Although the number of firms owned by women of color in the United States has more than doubled since 2007, the average revenue per firm for minority-owned businesses is $68,982, compared with $201,948 for non-minority-owned businesses. This is a significant gap that needs to be addressed,” she said.
“Identifying avenues of growth for firms owned by women of color is vital, as is providing them with the resources and opportunities they need to advance their businesses. To help address this issue, GROW is planning several new programs this year, including a new cohort-based training focused on helping women entrepreneurs who are in the growth stage to build capacity and take their businesses to the next level.”
The State of Women-Owned Businesses Report has been conducted annually since 2011. It is necessary because there is growing interest in learning more about growth in women’s entrepreneurship, and because government figures from the Census Bureau are only published every five years, meaning this series of reports fills in an important gap, said Julie Weeks, American Express OPEN research advisor.
“Our analysis shows that women are continuing to enter the ranks of business ownership at rates exceeding the national average — and have been doing so for the past 20 years. Yet, in the years since the recession, women are continuing that start-up trend while others have not — meaning that between 2007 and 2016, the growth in the number of women-owned firms is five times the national average,” she said.
“One thing that women are certainly doing to bring equality into the workplace is constructing their own workplaces through starting their own businesses. That's definitely one way to break through the proverbial glass ceiling. For those not yet in business ownership, there's advancement in numbers. As more women populate certain fields of endeavor — whether in the workplace or the boardroom — then things start to change.”
Changing the status quo can still be a challenge, though, and as women move into less traditional fields, there seems to be resistance, Weeks said. Accessing networks, especially informal networks, can still be a challenge, but such networks are important for any entrepreneur seeking guidance, introductions, equity financing and more.
“One of most remarked-upon economic trends in the wake of the 2007-09 recession has been the lack of employment growth. According to the U.S. Bureau of Labor Statistics, there were 150 million employed persons as of February 2016, up just 3.9 percent from February 2007,” the report read.
“Bucking that tepid growth trend is employment in women-owned firms, which is up 18 percent since 2007 compared to a 1 percent decline among all U.S. firms. Where is this employment growth coming from? The strongest employment growth among women-owned firms is seen among firms employing between 50 and 99 workers. These firms have spearheaded a 27 percent increase in employment since 2007, while both smaller and larger women-owned firms have seen positive employment gains, as well.”