Economic Impact of Women-Owned Firms Growing Across the U.S.

As noted in the recent 2016 State of Women-Owned Businesses Report – and in our previous blogpost – women-owned firms are continuing to grow in number and economic clout at rates well above the national average. But where, geographically speaking, are women-owned firms growing? The short answer is: everywhere!

When looking at the growth in the number of women-owned firms as well as growth in revenue and employment (which we call, collectively, growth in economic clout), the 10 fastest-growing states for women-owned firms between 2007 and 2016 are:

  • North Dakota, South Dakota, Texas (all three tied for first)
  • Iowa
  • Indiana, Wyoming (tied for 5th)
  • Georgia, Tennessee (tied for 7th)
  • Utah
  • Maine

These are states in the Northeast, Midwest, South and West.

A look at the top-ranked metropolitan areas for growth in the economic clout of women-owned between 2007 and 2016 paints a slightly different picture. All of the top ten metro areas (listed below) are found east of the Mississippi River – or in Texas! However, most of the 50 most populous metropolitan areas in the country are either east of or on the banks of the Mississippi River.

  • Charlotte NC/SC
  • San Antonio TX
  • Dallas TX
  • Memphis TN/MS/AR
  • Austin TX
  • Indianapolis IN
  • Miami FL
  • Detroit MI
  • Richmond VA
  • Houston TX

Comparing heat maps of the top states and top metro areas for growth in economic clout since 2007 finds that some of the fastest-growing states are those without large cities (such as North and South Dakota, Iowa and Wyoming) and some of the fastest-growing cities (Charlotte, Miami, Detroit) are growing faster than the rest of their states.

This geographic analysis also tells us that things are definitely hopping in Texas – the top-ranked state home to four of the top 10 metro areas. Perhaps everything really is bigger in Texas!

State of Women-Owned Businesses Report Published

Hey, fellow womenablers, your long wait is over! The 2014 State of Women-Owned Businesses report has now been published. You can view the American Express OPEN web summary HERE, or click HERE to simply download the full report.women_racing

We now have the most up-to-date accounting of the number and growth trends among women-owned businesses in the United States. As of 2014, we (Womenable authored the report, American Express OPEN underwrote and published it) estimate that there are 9,087,200 majority-owned and privately-held women-owned firms, employing 7,854,200 employees in addition to the owner, and generating over $1.4 trillion ($1,410,940,800,000) in revenues. What are some of the other key trends uncovered in this year’s report? Among them:

  • Between 1997 and 2014, when the number of businesses in the United States increased by 47%, the number of women-owned firms increased by 68% – a rate 1-1/2 times the national average. Indeed, the growth in the number (up 68%), employment (up 11%) and revenues (up 72%) of women-owned firms over the past 17 years exceeds the growth rates of all but the largest, publicly-traded firms – topping growth rates among all other privately-held businesses over this period.
  • Nationally, the number of women-owned firms has increased by 68% since 1997. The states with the fastest growth in the number of women-owned firms over the past 17 years are: Georgia (up 118%), Texas (98%), North Carolina (91%), Nevada (91%) and Mississippi (81%). In terms of growth in combined economic clout, however – meaning averaging together the rankings in growth in the number, revenues and employment of women-owned firms – the states in which all of these measures combined place women-owned firms in a much better than average position over the 1997 to 2014 period are: North Dakota, the District of Columbia, Nevada, Arizona and Georgia.
  • In 1997, there were just under 1 million (929,445) firms owned by women of color, accounting for one in six (17%) women-owned firms. That number has skyrocketed to an estimated 2,934,500 as of 2014, now comprising one in three (32%) women-owned firms. Firms owned by African American women number an estimated 1,237,900 as of 2014. These 1.2 million firms employ 287,100 workers in addition to the owner and generate an estimated $49.5 billion in revenue. Firms owned by Latinas number an estimated 1,033,100 as of 2014. These firms employ 433,600 workers in addition to the owner and generate an estimated $71.1 billion in revenue. Firms owned by Asian American women number an estimated 675,900 as of 2014. These firms employ 699,200 workers in addition to the owner and generate an estimated $115 billion in revenue.
  • While firms owned by women of color are smaller than non-minority women-owned businesses both in terms of average employment and revenues, their growth in number and economic clout is generally far outpacing that of all women-owned firms. Indeed, the growth in the number of African American (up 296% from 1997 to 2014), Asian American (+179%), Latina (+206%), Native American/ Alaska Native (124%), and Native Hawaiian/Pacific Islander (+247%) women-owned firms all top the growth in the number of non-minority women-owned firms (+37%) over the past 17 years.

New this year is a look at business start-up activity, which shows that there are an increasing number of women business owners at the starting gate. On average over the past 17 years, there has been a net increase* of 591 women-owned businesses each and every day. The number of net new women-owned firms has fallen in the wake of the recession – there was a net increase of 714 women-owned firms per day from 2002 to 2007, and a lesser 506 per day between 2007 and 2014 – but start-up activity is increasing. Just in the past year, there have been an estimated 1,288 net new women-owned firms launched each and every day.

What’s the bottom line? Women business owners are not only here to stay, they are moving into entrepreneurship in equal numbers. The challenge that remains is moving women-owned firms up the growth continuum, and gaining a greater understanding of impediments to growth and how best to follow a woman’s path from a start-up with promise to a successful business that moves beyond the “majority-owned, privately-held” category to being woman-led and perhaps publicly-traded.

* “Net increase” takes into account all of the new women-owned firms minus the number of women-owned firms that either ceased operations or ceased to be majority women-owned.

A New Measurement of Support for Women’s Entrepreneurship

The Womenabler has long lamented the lack of a business-enabling environment (BEE) assessment that takes the special challenges facing would-be and established women business owners into account. Traditional BEE assessments (such as The World Bank’s Doing Business indicators or the Heritage Foundation’s Index of Economic Freedom) are “gender-blind,” thus ignoring both the legal and cultural impediments that exist for women in many countries when they attempt to start or grow businesses. And, at the same time, gender equality indices (such as the World Economic Forum’s Global Gender Gap reports, the Economist Intelligence female figure on map of EuropeUnit’s Women’s Economic Opportunity Index, or the UN’s Gender Empowerment Measure) do not include entrepreneurial measures as among the factors assessed. And, interestingly, the top-ranked countries in each of these two distinct types of environmental assessments share exactly 0 countries in common. (See the paper, “Assessing Business-Enabling Environments: How Gender Changes the Equation,” presented by Womenable CEO Julie Weeks in 2011 at both an academic conference and a meeting of national policy institutions.)

Now, into the breach, comes an exciting new project: Gender-GEDI. Spearheaded by a team at George Mason University that also developed the Global Entrepreneurship and Development Index (hence GEDI), this new index insist of 30 evaluation factors, aggregated into 15 pillars and three main environmental elements: entrepreneurial environment, entrepreneurial eco-system and entrepreneurial aspirations. The pilot effort assessing the individual, institutional and legal environment for high-potential women’s entrepreneurship includes 17 countries – picked to represent a variety of regions and development contexts. Who came out on top? Here’s the list:

  1. United States
  2. Australia
  3. Germany
  4. France
  5. Mexico
  6. United Kingdom
  7. South Africa
  8. China
  9. Malaysia
  10. Russia
  11. Turkey
  12. Japan
  13. Morocco
  14. Brazil
  15. Egypt
  16. India
  17. Uganda

This new analysis was underwritten by Dell, and released today at their 4th annual Women’s Entrepreneur Network gathering in Istanbul, Turkey. Womenable was pleased to have played a role as an advisor on this effort, and we look forward to expanding the analysis to additional countries in the future (pending funding, of course!)

Click on these links to learn more about Gender-GEDI, a news release summary of the findings of this important new analysis, and to download and read the 22-page white paper.

New WEF Global Gender Gap Report Shows Both Progress & Persistent Gaps

For the seventh year running, the World Economic Forum has published its Global Gender Gap Report, taking a look at 135 world economies and measuring the extent of gender equality (or inequality) in four main areas:

  1. health and survival
  2. educational attainment
  3. economic participation
  4. political empowerment

As we and others have oft lamented, it’s a shame that economic participation doesn’t include any entrepreneurship measures – but there are a lack of consistent, comparable data measuring the number of women-owned firms in countries around the world. Economic participation remains an area with persistent gender gaps. And political empowerment remains the area with the consistently widest gender gap.

Be that as it may, the 2012 report again shows the continuing dominance of the Nordic countries in gender equality across these measures. Iceland, Finland, Norway, Sweden, and Denmark have all ranked in the top ten in all seven years of the report – with Iceland topping the list since 2009.

Three other countries have made it to the top ten in all seven years of the report as well: Ireland, New Zealand, and the Philippines. Rounding out the top ten are Nicaragua and Switzerland, both well improved from their 2006 rankings of 62 and 26, respectively.

Given that there is now a 7-year trend to examine, it’s interesting to note where there have been significant improvements. In addition to the remarkable progress in Nicaragua, several African countries have made great leaps forward:

  • Madagascar, which has advanced from 84 to 58 on the list due to improvements in the political empowerment of women,
  • Malawi, which has lept from 81 to 36 due to improvements in economic participation, and
  • Uganda, which has advanced from a ranking of 50 to 28 over the past seven years on the heels of advancements in health and survival.

At the other end of the spectrum, there has been some backsliding in some countries, most notably in eastern Europe, where:

  • Croatia has fallen from a ranking of 16 to 49, due mainly to a decline in political empowerment,
  • Macedonia has slipped from 28 to 61, with declines in economic participation and political empowerment, and
  • Moldova has declined from a ranking of 17 to 45 as a result of slippages in political empowerment, economic participation and educational attainment.

And, as we’ve seen in every year of the report’s publication, there are some countries in which persistent gender gaps exist in more than one area. Yemen, Pakistan, Chad, Syria and Saudi Arabia have remained at the bottom of the list since 2006, when 115 countries were evaluated and ranked. As has been mentioned by more than one political and social commentator, the Arab Spring has most certainly not resulted in any pervasive progress for women in the MENA region.

App Happiness for Womenablers

Are you a womenabling data junkie like we are? Well, get ready to enter womenabling data nirvana – there are now some wonderful women’s entrepreneurship reports available for smartphone and iPad, as well as (bestill my beating heart) data-finding apps for the smartphone. Here’s a roundup:

  • The US Census Bureau has just launched America’s Economy, a smartphone app that will allow quick (well, not so quick – it loads slowly) access to the latest business stats. No women-specific stats yet, but the recently improved American FactFinder provides very ready access to the 2007 economic census data,
  • The World Bank recently launched a new Data Finder smartphone app, containing a wealth of development statistics by country and by topic – including gender,
  • The World Bank’s seminal 2012 World Development Report, Gender Equality and Development, is available as an e-publication for iPad, and
  • a lush, photo-rich e-publication app, Women of the World – from Olivier Martel, Fotopedia and the World Bank – is also available and well worth downloading from the iTunes store.

Click on and get app happy!

New Statistics on Economic Clout of Women-Owned Firms in US

Attention all womenablers – updated intelligence on the state of women-owned businesses in the US is now available. The 2012 State of Women-Owned Businesses Report, commissioned by American Express OPEN and prepared by Womenable, reveals that:

  • As of 2012, it is estimated that there are over 8.3 million women-owned businesses in the United States, generating nearly $1.3 trillion in revenues and employing 7.7 million people;
  • Comparing trends in the number and revenue accomplishments of women-owned and all firms by industries finds that women-owned firms are exceeding overall sector growth in seven of the 13 most populous industries, and there are several industries in which women business owners are standing toe to toe with their competitors in terms of revenue accomplishments;
  • How women-owned firms are faring depends on whether the point of comparison is all firms or all privately-held firms. Women-owned firms are holding their own, meeting or exceeding average revenue and employment growth, when compared to all privately-held firms – falling short only when their growth is compared to the very largest publicly-traded firms; and finally
  • While we learned last year that the growth of women-owned firms falters as they reach the 100-employee threshold and the million-dollar mark, a new analysis shows that the relative strength of million-dollar women-owned firms is greater now than it was a decade ago. Further, we may be losing a full accounting of the economic clout of women-led firms as they “outgrow” the 51%+ definition of being women-owned.

The 73-page report also contains state-level data as well as information on the 25 most populous metropolitan areas in the country. Learn more about this new must-have report, and download a copy for your womenabling reference shelf, at the link above. More blogposts will soon be available on OPENforum.com. You may also wish to read the study news release on BusinessWire, and read the lead article covering the study which appeared in the Wall Street Journal.

Growth of Women-Owned Firms Continues, But Keeps Pace Only Until 100 Employee and $1M Revenue Marks

A new analysis of recently-released Census data on women-owned enterprises in the United States finds that the growth in the number of women-owned firms continues at rates exceeding the national average, and that growth in revenue and employment keeps up the pace with all firms, but only until women-owned firms reach the 100-employee level or the $1 million revenue marks.
State of WOBs 2011 report cover
Women-owned firms are now estimated to number just over 8.1 million, generating nearly $1.3 trillion in revenues and employing 7.7 million workers. The new report, The American Express OPEN State of Women-Owned Businesses Report: A Summary of Important Trends, 1997-2011, also provides estimates of the number and economic contributions of women-owned firms by industry, by state, and by revenue and employment class of firm.

Womenable conducted the analysis, basing the 2011 estimates on an analysis of the 1997, 2002, and 2007 Census data, the latter having just been released in December 2010. Learn more about and download the 53-page report free at OPENforum.com.women and read the full study news release here.

Rich Industry and State Data

The report offers rich insights at the industry and state level. For example, the analysis shows that:Share of WOBs within Industries

  • Women-owned firms continue to diversify into all industries, rendering the term “non-traditional industries” virtually meaningless today. While there remain some predominately female industries (52% of all health care and social assistance firms are women-owned, for example) and while just 8% of construction firms are women-owned, most other industries come close to the overall 29% share of women-owned firms in the economy;
  •   Between 2002 and 2011, the fastest growth in the number of women-owned firms has been in education services (up 54%), administrative and waste services (+47%) and construction (+41%);
  •  The states with the fastest growth in the number of women-owned firms between 1997 and 2011 are Georgia, Nevada, Mississippi, Florida, and North Carolina; while the states with the lowest rate of increase in the number of women-owned firms are Alaska, West Virginia, Iowa, Indiana, and Vermont. 

New Insights on When Growth Falters 

We’ve all heard the finding that “the number of women-owned firms is growing at twice the national average.” This new analysis shows that the rate of increase in the number of women-owned firms still tops the national average, but the ratio is now 1.5:1 – a 50% increase in the number of women-owned firms between 1997 and 2011 compared to 34% among all U.S. firms.
Revenue Growth of WOBs by Firm Size
We also know that growth in revenue and employment in women-owned firms has always lagged the national average overall, but a more in-depth analysis of growth by business size shows that – in actuality – women-owned firms keep up the pace with the revenue and employment growth of all U.S. firms, but only until a certain point. With respect to revenue growth, women-owned firms match the revenue growth of all firms on a percentage basis all along the business size spectrum – until the million-dollar revenue mark.  With respect to employment, again women-owned firms match percent growth along most of the business size spectrum – but falter after the 100-employee threshold is crossed.

This new analysis should dispel the notion that women-owned firms start small and stay that way. In point of fact, they are progressing along the growth spectrum at a pace matching all firms – and even exceeding that of men-owned firms – and start to lag only as they approach the upper echelons of business achievement.

More work needs to be done to better understand what barriers are standing in their way, and how they may be overcome. This new report provides a much deeper understanding of growth and invaluable signposts to help guide the way.