The role of women entrepreneurs in the United States economy continues to grow. A study of the landscape done in a recent U.S. Senate report indicates both strong growth, along with obstacles that female-owned businesses deal with disproportionately, compared to their male counterparts.
Nearly 40 percent of all businesses have majority female ownership, and they do $1.7 trillion in business. The number of women-owned businesses has nearly tripled over the last thirty years. The percentage of female-owned businesses tracks parallel with the percentage of women who are the primary breadwinner in their household. The growth is particularly explosive in the last ten years, where women have been five times more likely than men to start their own firms.
But this still a mixed bag. Part of the reason for the growth is that women—particularly mothers—are more likely to miss out on promotions. This is especially true at the executive level, where budding entrepreneurs are most likely to be found. And the gender pay gap persists—a women coming out of college can expect to earn about 90 percent of what a similarly credentialed man in her field will make. Frustration with all these factors leads women to seize control of their own economic destiny.
Once a woman steps into the entrepreneurial world, she still faces tougher sledding at securing funding for her startup. Women received only 2 percent of all venture capital funding in 2016. The result is that women are much more likely than men to rely on credit cards—and their high interest rates—to get through the startup phase of their business.
Increasing the number of women entrepreneurs is a comprehensive process, that begins with mentoring at a young age and increasing access to technology education. Both are key indicators of whether a person will start a business. A continued growth of female participation in economic life requires plans for both the short-term and long-term.