The State of Women-Owned Businesses in the U.S. in 2013

With the support of American Express OPEN, Womenable has reported on trends in the growth and development of women-owned enterprises, drawing upon detailed information from the U.S. Census Bureau, since 2011.

In our inaugural report, The American Express OPEN State of Women-Owned Businesses Report: A Summary of Important Trends, 1997-2011, we provided up-to-date estimates on the number, employment and revenues of women-owned firms, and shared the insight that – despite above-average growth in the number of firms – women-owned businesses were not progressing up the business size continuum.
2013_State_of_WOBS_cover
Our 2012 report, The State of Women-Owned Businesses Report: A Summary of Important Trends, 1997-2012, again provided up-to-date estimates of the number and growth of women-owned firms, and took a more detailed look at the economic clout of women-owned firms regionally and within industry – finding that women-owned firms in two industries (construction and transportation) were standing toe-to-toe with their industry peers with respect to the share generating $500,000+ in revenues.

With our most recent installment in the series, The 2013 State of Women-Owned Businesses Report: A Summary of Important Trends, 1997-2013, we again provide women business owners and their associations, supporters of women’s business development and other stakeholders with the most comprehensive review and analysis of the current health and well-being of women-owned firms in the United States – as well as in all 50 states and the 25 most populous metropolitan areas. Further, the report expands its focus this year to look at the phenomenal growth of firms owned by women of color.

Among this year’s key findings are:

  • As of 2013, it is estimated that there are over 8.6 million women-owned businesses in the United States, generating over $1.3 trillion in revenues and employing nearly 7.8 million people. The growth in the number, revenues and employment of women-owned firms over the past 16 years exceeds the growth rates of all but the very largest, publicly-traded corporations in the country;
  • Indeed, when looking specifically at the 2007-2013 period – since just before the start of the recent recession – the net increase of 5.3 million jobs economy-wide has come almost entirely from very large public corporations … AND women-owned firms. During the past six years, employment in women-owned and equally-owned firms has fallen;
  • The states in which growth in the number, employment and revenues of women-owned firms has been the strongest since 1997 are the District of Columbia, North Dakota, Nevada, Wyoming and Georgia. San Antonio TX, Portland OR, Houston TX, Riverside CA, and Washington DC/MD/VA are the fastest-growing metro areas for women-owned businesses;
  • 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 2,677,700 as of 2013, and now comprises one in three (31%) women-owned firms;
  • 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 258% from 1997 to 2013), Asian American (+156%), Latina (+180%), Native American/ Alaska Native (108%), and Native Hawaiian/Pacific Islander (+216%) women-owned firms all top the growth in the number of non-minority women-owned firms (+32%) over the past 16 years.

You may download and read the complete 71-page report by visiting openforum.com/womensbusinessreport or clicking on the link above. You may also wish to download and read the news release for the report.

Advertisements

Many Successful Women-Owned Businesses are Growing “Under the Radar”

There’s a new report just out that kicks off 2013 with some great news: women-owned firms at the highest level of revenue achievement have been doing even better than we might have imagined. They’ve been growing in number right under our very noses. In fact, the number of women-owned firms with $10 million or more in revenue has increased by 57% over the past decade – a rate fully 47% faster than the growth of all $10M+ businesses, and nearly twice (+98%) the rate of growth of all women-owned firms.woman_icecliff copy

These startling new facts are from Growing Under the Radar: An Exploration of the Achievements of Million-Dollar Women-Owned Firms, a new report authored by Womenable and commissioned by American Express OPEN.

How could this have been happening, largely undetected, under our very noses? Well, the “million dollar bucket” is a diverse one – containing both relatively small $1 million privately-held firms and multi-billion dollar publicly traded corporations. And, since this population contains just 2% of women-owned firms and 5% of all firms, it’s the largest sales category published by the Census Bureau. Now, for the first time, Womenable was able to obtain previously unpublished data from our friends at the Economic Statistics Branch of the Census Bureau (mwah!) – and the information is gratifying:

  • Between 2002 and 2012, the number of majority women-owned firms with $10 million or more in revenues increased from 8,110 to 12,700 – a 56.6% increase. During that same time period, the number of women-owned firms with $1 million or more in revenues grew from 116,985 to 152,900 – a 30.7% increase. Thus, the growth in the number of $10M+ women-owned firms exceeds the growth of all $1M+ women-owned firms by 84%.
  • Comparing growth rates among the firms of highest achievement finds women-owned firms again surpassing average growth by a large margin. The growth in the number of $10M+ women-owned firms (56.6%) surpasses the growth in the number of all $10M+ businesses (38.4%) by fully 47%.
  • The share of firms reaching this rarified atmosphere remains small. Within the population of million-dollar firms, 75% have $1-$4.9 million, 12% have $5-$9.9 million, and 13% have $10 million or more in revenues. Among million-dollar women-owned firms, 82% have $1-4.9M, 10% have $5-9.9M, and 8% have $10M+ in revenues.
  • Some industries are more scalable than others. Looking within the population of million-dollar women-owned firms finds that women-owned firms in wholesale trade have achieved the highest level of firm revenues. Fully 20% of the million-dollar women-owned firms in this industry have topped the $10 million mark, well above the 8% seen among all million-dollar women-owned firms. Women-owned firms in three other industries have also exceeded the 8% national average: finance and insurance, in which 12% of million-dollar women-owned firms have achieved $10M+ in revenues; transportation/warehousing, in which 11% have passed the $10M mark; and arts/entertainment/recreation, in which 10% have done the same.

And, perhaps most importantly, why has this been happening? In our view, growth at the upper reaches of business achievement is not only a logical next step in the continued overall growth at rates exceeding the national average, there is now much more support for these mountain-climbing women – such as The Committee of 200 and the Women Presidents’ Organization. Higher achieving women are now getting more visibility and recognition. While it’s still not always good (strong, successful women still referred to in less-than-flattering, rhymes-with-witch terms), greater visibility provides more role models for young women, more of whom may be dreaming bigger because of the achievements of these high-flying women.

The news coverage of this exciting new report was kicked off late last week by an article in Meghan Casserly’s Girl Friday column for ForbesWoman, “Women In (Big) Business: How XX-Driven $10 Million Plus Firms Could Take The Lead.” More are sure to follow, as we’ve been chatting with a number of reporters.

In the meantime, fellow womenablers, read the report, applaud our achievements, and start spreading the news!

Womenable Testifies at U.S. Senate Hearing

Womenable President and CEO Julie R. Weeks testified at a recent hearing of the Senate Committee on Small Business and Entrepreneurship, entitled “Creating Jobs and Growing the Economy: Legislative Proposals to Strengthen the Entrepreneurial Ecosystem.” Weeks was one of eight witnesses invited to address the committee. Other witnesses included officials from the U.S. Small Business Administration, a representative from the National Federation of Independent Business chapter in Maine, an official from the Granite State Economic Development Corporation, and business owners. Weeks spoke as an expert in women’s enterprise development, and as chair of the Association of Women’s Business Centers.JulieWeekstestimony_sm

The hearing, held on November 29th, focused on actions that the Committee could take now and early in the next Congress to spur small business growth and job creation. Weeks’ testimony, which can be downloaded and read in its entirety HERE (PDF file with active source links) or HERE (HTML on the SBC website), offered three specific policy recommendations:

  • Federal Procurement and WOSBs: Eliminate the monetary cap which is currently limiting the procurement opportunities that can be directed toward women-owned small businesses, and enable agency procurement officials to restrict competition for WOSBs;
  • Women’s Business Centers: Ensure that the SBA, when measuring and analyzing the performance of the WBC program, includes all of the support provided by WBCs, not just one-on-one counseling; and
  • The Census Bureau’s SBO Program: Ensure the continued funding of the quinquennial Survey of Business Owners program, and direct the Census Bureau to investigate growth continuum issues such as the emergence of “women-led” firms, and the feasibility of determining the gender ownership status of non-profit businesses.

The hearing was also significant in that it was the last Senate Small Business Committee hearing to be co-lead by retiring Senator Olympia Snowe – who has been a champion not only of small business development in general but of women’s enterprise development in particular during her storied 35-year Congressional career. Weeks concluded her testimony with a tribute to Snowe, saying,Weeks_Snowe_sm

“Finally, if I might be so presumptuous to speak on behalf of the entire women’s enterprise development community, I would like to recognize that, ever since she came to the U.S. Congress in 1978, Senator Olympia Snowe has been a vocal supporter and forceful advocate for women’s entrepreneurship issues without equal in the U.S. Congress. Her support and thought leadership on behalf of the women’s business center program, on federal procurement issues, on SBA entrepreneurial development coordination and impact evaluation, on the National Women’s Business Council; her inclusiveness in calling advocates to the table to discuss challenges and solutions; and the collegial way she has led the Senate Committee on Small Business and Entrepreneurship as both Chair and Ranking Member is unparalleled and is a shining example of the best in national politics and policymaking. Her voice and leadership will be sorely missed by all of us.”

All in attendance gave Senator Snowe a standing ovation near the start of the hearing.

A press release issued by the Committee can be read HERE, and video from the 2+ hour hearing can be viewed on the Senate SBC video archive or on C-SPAN.org. (Weeks was the last of the panelists to testify.)

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!

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.

The Most Womenabling News of 2010

In our year-end e-newsletter, rather than summarizing the latest womenabling news and providing womenablers everywhere with insights to educate, enlighten and empower your efforts, we’re ending the year by compiling what we feel are the most interesting and relevant activities that have taken place in the field of women’s enterprise development in 2010. Repeated here, and in no particular order, are what we see as the ten most noteworthy trends and events of the year:

  1. The establishment of UN Women: It’s been talked about and touted for a number of years, and this year it finally happened: the merging of heretofore disparate UN activities for and about women into one “super agency” for women: the “UN Entity for Gender Equality and the Empowerment of Women,”  otherwise known as UN Women. This entity will oversee efforts formerly under the purview of the UN’s Division for the Advancement of Women (DAW), International Research and Training Institute for the Advancement of Women (INSTRAW), Office of the Special Adviser on Gender Issues and the Advancement of Women (OSAGI), and the UN Development Fund for Women (UNIFEM). Heading the new combined entity is former Chilean president Michelle Bachelet. What do you need to know about the new agency and how you can engage with it? Read this.
  2. Expansion of women’s empowerment measurements: Where does women’s economic empowerment stand? Some of the most well-known measurements of women’s empowerment include the World Economic Forum’s Global Gender Gap reports, the UN’s GDI and GEM measurements, and the OECD’s Gender, Institutions and Development Data Base. However, all of these include several other measures (including health, education and political participation) as well as economic empowerment and, with respect to the latter, focus on women as workers rather than business owners. There are the Global Entrepreneurship Monitor’s reports on women and entrepreneurship but, sadly, one has not been published since 2007. This year, though, saw the addition of two new kids on the block, and both of these indicators focus entirely on economic empowerment, and specifically on entrepreneurship. They are the Economist Intelligence Unit’s Women’s Economic Opportunity Index, and a new GenderCLIR methodology for BEE assessment from USAID/Booz Allen Hamilton.
  3. A picture’s worth a thousand words: The International Museum of Women launched a powerful online exhibition this year, Economica: Women and the Global Economy. One project within the exhibition is Picturing Power & Potential, a juried photo exhibit which proves the adage and is well worth a look. Bookmark and return to the site as they add to it in the coming year.
  4. Recognition of “The Female Factor” in some media circles, but …: The International Herald Tribune has written a number of compelling articles about women’s empowerment issues this year as a part of their series, “The Female Factor.” And Canada’s Globe and Mail launched a national conversation about Women in Power during Women’s History Month in Canada (October). Despite this nice coverage, however, a recent study, Who Makes the News? The Global Media Monitoring Report 2010, finds that women’s voices and stories – especially about economic issues – are still largely untold in the news media.
  5. Second interval review for MDGs: In 2000, at the United Nations Millennium Summit, 189 world leaders planted an ambitious flag in the ground, agreeing on eight Millennium Development Goals aimed at eliminating world poverty by 2015. (Our favorite: #3, gender equity.) A “second interval” review of the progress being made on meeting those goals was held this year, including the publication of an MDG report and the convening of an MDG summit. The bottom line? Progress is indeed being made, but in many cases is uneven, affecting some populations and not others. Here’s a report card showing some of the details. While this review shows that much remains to be done to meet the 2015 deadline, “It is not in the stars to hold our destiny, but in ourselves.” (William Shakespeare)
  6. Progress stalled for WED in UK: Last year, in our year-end top trends E-newsletter, we noted the implosion of Prowess – the UK’s key advocacy organization for women’s economic empowerment. Well, things have gone from bad to worse in the UK for women’s enterprise development with the election of a   Conservative/Liberal Democrat coalition government. As  feared/expected, one of the new government’s first acts was declaring  that Business Link and Regional Development Agencies would be phased  out, in favor of Local Enterprise Partnerships. It remains to be seen how this will impact focused/tailored business support services such as the women’s business centre pilot programme, but our guess is that it won’t be positive.
  7. A new ED and Chair for NWBC: Another issue we followed with interest last year (though it did not make our top ten list) was stalled activity at the National Women’s Business Council in the wake of the 2008 US presidential election. Well, things are starting to move once again, with the hiring of a new executive director, Dana Lewis, and the appointment of a new chair, Donna James. Filling Council seats and revving up Council activities should commence in 2011. Women’s business advocates in the US are relieved.
  8. Quinquennial census of women-owned firms in the US: Say what you will about the growing hegemony of political and economic power worldwide, the United States still rocks when it comes to measuring the number and economic power of women-owned businesses. The  2007 quinquennial economic census of women-owned firms was published this year. Womenable summarizes the key trends for you in this blogpost.
  9. Progress in procurement: Doing business with the US government is getting easier for women-owned businesses. Finally, after a ten-year wait, a women-owned business procurement program is finally going to be launched by the SBA early next year. Not content to wait for this to happen, late in 2008 Women Impacting Public Policy, with the support of American Express OPEN, launched a “Give Me 5%” initiative (which refers to the gov’t-wide spending goal for women-owned firms) to educate women business owners on how to do business with the federal government. Where do things stand with respect to meeting that 5% goal? Federal spending with women-owned firms stands at 3.7% as of FY2009, up from 2.4% a decade earlier but still well short of the goal.
  10. Making market connections: There are two new initiatives poised to help women business owners globally make significant market connections with another important customer: large corporations. First is WEConnect International, an organization that was founded in 2009 but started to get its sea legs this year with the launch of WEConnect Europe and an event in London this October. WEConnect’s goal is to make it easier for large corporations to find women-owned business suppliers and for women-owned firms to learn how to do business with large corporations. And speaking of large corporations, one of them – Coca-Cola (ranked 404 on Fortune’s Global 500 largest companies) – announced a “reach for the stars” goal at this year’s Clinton Global Initiative conference. Coke’s “5 by 20” project aims to draw 5 million women into its Micro Distribution Center program in Africa and elsewhere by the year 2020.

Trends Among Women-Owned Enterprises in the US: Insights from New Census Data

Back in July, the US Census Bureau published preliminary estimates of the number and overall growth of women-owned enterprises as of 2007 at a national level. At that time, we learned that:

  • There are 7.8 million majority women-owned firms in the US, accounting for 29% of all businesses in the country,
  • These enterprises employ 7.6 million workers, contributing 6% of the jobs in the country, and
  • These firms generate $1.2 trillion in revenues, accounting for 4% of all business receipts nationally.

Just yesterday, however, the Census Bureau released the final numbers, along with more detailed figures at the state and local level, as well as by industry and size level of the firm. What does this new information show? While there is still a lot of data for Womenable and other womenablers to sift through (and sift we shall), we thought that all of you would be interested in our key first impressions and take-aways from this recent announcement. We have three initial impressions to share with you.

FIRST, women-owned firms are still growing – but that growth lies in partnership. As of 2007, as noted above, the number of majority women-owned firms stands at 7.8 million, accounting for 29% of all businesses. That number represents a 20% increase since the 2002 census, about equal to the 18% seen among all firms. However, lest you think that is a retreat from the “women-owned firms are growing at twice the national average” mantra of the past decade, the Census has improved the way it is tallying equally-owned firms. Those firms grew in number from 2.7 million to 4.6 million, a 71% increase. So, if one were to look at “women- and equally-owned” firm growth over the past five years (which I personally do not like to do, as it becomes synonymous with “women-owned firms” and thus confuses the statistical picture and international comparisons), growth among that population stands at 35%, which is nearly twice the 18% national rate. There is also hidden women-led firm growth in the “unclassifiable by gender” category – which grew in number by 63% over the past five years. While these firms represent only 3% of US firms, they account for 64% of revenues and 52% of all employment. It is in this area that we need more research and dissection – to parse out and tally the impact of plurality women-owned firms (which we like to think of as women-led – and which would include women-founded firms with equity partners or venture capital investments) and women-led social enterprises (which are of increasing interest but have not yet been looked at separately in Census data).

SECOND, we now can see where women-owned firms are faring best in terms of industry and geography. From a geographic perspective, taking a look at what states are host to the greatest share of women-owned firms, we can see that the share of women-owned firms by state ranges from a low of 22.1% in South Dakota to a high of 34.5% in the District of Columbia. There are three states in which the share of women-owned firms is 31% or greater: Maryland (32.6%), New Mexico (31.7%), and Hawaii (31%). It seems that it pays to be close to the Nation’s Capital – confirmation, perhaps, of the importance of the implementation of the Women-Owned Small Business Procurement Program by the US Small Business Administration, which will be unveiled next February.

In terms of industry, the publication of the 2007 census now allows, for the first time, a multi-year analysis of growth by gender and industry using the new North American Industry Classification System (NAICS codes). Implemented for the first time in the 2002 Census (preventing us, unfortunately, from taking a longer view of growth by industry), we can now see what the “hot industries” for women-owned firms are, and they are:

  • Administrative services (think personnel/temp agencies, travel agencies, investigative services, janitorial or landscaping services, and trade show organizers): this sector represents 10% of women-owned firms and has grown (in number of firms) by 38% over the past five years,
  • Educational services (including business/secretarial and computer training providers, language schools, and exam preparation/tutoring), which is home to 4% of all women-owned firms, growing in number by 44% since 2002,
  • Arts/Entertainment/Recreation Services (including performing arts agents, companies and artists, golf courses, marinas and ski facilities, and amusement parks): 5% of women-owned firms, up 30% over the past five years, and
  • Construction firms, representing 3% of all women-owned businesses, an increase of 33% since 2002.

THIRD, and perhaps most importantly, women-owned firms have not gained ANY significant economic ground over the past five years. (It should be noted that these data do not include our most recent recessionary period.) In 2002, 2% of all women-owned firms employed 50 or more workers. That share is unchanged today. And, while the total number of million-dollar women-owned firms has grown by 21% over the past five years (from 117,069 to 141,893), compared to a 9% increase among men-owned firms – these firms still only comprise a 2% share of women-owned firms, unchanged from the share seen in the 2002 Census. Perhaps most importantly, when compared to men-owned firms, women-owned firms still lag behind: 4% of men-owned firms employ 50 or more workers, and 6% generate $1 million or more in revenue. While we take exception to the gloom-and-doom interpretation of the US Women’s Chamber of Commerce report, Women’s Businesses Struggle for Market Share (we have not lost “market share” but neither have we gained any), we strongly feel that what is needed – by public policy makers, women’s business organizations, educators and other stakeholders – is a concerted and better coordinated effort to get women business owners to set their growth goals higher. In the US (unlike in many other countries), getting women to start businesses is not the challenge; it is getting women business owners to “think bigger” and to grow their firms to the next level. These new data confirm what Womenable has known for quite some time – that the “sweet spot” for women’s enterprise development in the next decade or more will be the “missing middle.” That is why organizations like WEConnect International, Count Me In’s Make Mine a Million $ Business initiative, and WIPP’s Give Me 5% program are so critically important.

If you’re curious to learn more about the new Census data, you might want to visit these links:

  • The Census Bureau’s news release highlighting key statistics, in English and in Spanish,
  • The web page containing links to key tables and charts pertaining to women-owned businesses, and
  • The American Fact Finder summary page of key web-based data tables from the Survey of Business Owners (SBO).

Finally, mark your womenabling calendars for June 2011 – that’s when the Census Bureau will release their summary SBO data, which will contain information on the number and economic contributions of firms owned by women of color. We’ll be waiting for that important news, and will share the results when they are available.