Women are the future of business in the United States, a report commissioned by American Express contends. And minority women are driving this progress, with businesses owned by women of color growing at a higher rate than others.
Between 2014 and 2019, women-owned businesses grew 21%, researchers found, with women of color seeing their businesses grow 43%. And while businesses owned by Asian-American women earned more than others, making over $223 million in combined revenue in 2019 alone, African- American women-owned businesses grew 50%, a much faster rate than businesses owned by Latinas and Asian- Americans.
But the report looks at more than just the numbers, giving us a better idea of what incentives are boosting the entrepreneurial spirit among American women as a whole. Furthermore, the report also looks at how many people these women are benefiting, stating that women-owned businesses in the U.S. employ over nine million workers. This proves that, while there is a gap between the size and number of businesses owned by women and businesses owned by men, women of all backgrounds now have greater access to the tools necessary to make their dreams come true.
Opportunities, Needs, and the Entrepreneurial Spirit
Women’s share of U.S. businesses grew from 4.6% in 1972 to 42% in 2019. And currently, there are 15,258,900 firms owned or co-owned by women in the country, which account for 49% of all U.S. businesses.
While some believe that women’s increasing involvement in both the workforce and the entrepreneurial world is a bad sign, claiming that broken families and lack of opportunities are forcing women to become the breadwinner, the reality is that entrepreneurship is also becoming more appealing to mothers, even those who are happily married to men who also participate in the family’s finances.
Flexibility, these women say, is essential in their daily lives and running their own business gives them the freedom they need, even if they aren’t making as much money as male business owners. A fact that was confirmed by the American Express report.
Researchers found that flexibility is part of the winning combination behind businesswomen’s success in 2018 and 2019, with necessity and opportunity being the other two factors driving up the number of women-owned businesses .
In many cases, the report found, women weren’t able to find fulfilling employment, prompting them to start their own businesses. But those who were also driven by flexibility were mostly mothers who wanted to continue to care for their children. Because workforce policies often fail to accommodate their needs, they take the road less traveled.
Finally, there were cases of women starting their own firms who didn’t see flexibility nor necessity as a major role. In these cases, women simply found they could fulfill a market demand on their own, not having to rely on others to realize their vision.
While the report bemoans the fact that there’s still a major gap between women-led and men-led businesses when it comes to earning and employment, when you consider that many of these women have other priorities, such as the caring of children, it makes sense that they are less likely to focus on business ventures that will take much of their time, therefore slashing their earnings in favor of spending more time with their families.
This isn’t a problem but a choice. As a matter of fact, it simply shows that anyone can successfully start a business without having to dedicate 100% of their time to make it happen. If anything, this is a win for the market, as it doesn’t discriminate against anyone, giving women of all backgrounds an opportunity to grow, even if they also care for their family in the meantime.
Instead of pressuring lawmakers to intervene in the market by pushing new family leave laws, we should encourage lawmakers to cut the red tape and lessen the bureaucracy associated with opening businesses. It is only when we remove obstacles that we give all women, especially those in the low-income bracket, a real shot at succeeding.