Reported by Liku Zelleke
More women than ever, are running the largest number of small businesses in the United States. This week, it was revealed by the National Women’s Business Council that there were 10 million women-owned businesses in the country in 2012. That same year, the number of men owning businesses equaled about 15 million.
The council’s census defines a “woman-owned business” as one that has a woman owning 51 or more percentage of the business’ equity or stock. The numbers also indicated a sharp increase from 2007, by 27.5 percent.
Although men still own more businesses than women do, the women have been catching up at an impressive rate of four times that of their male counterparts.
Profit numbers show that, over all, women-owned businesses made a total of $1.6 trillion from 2007 to 2012. The vast majority of these businesses – at 89.4 percent – were actually sole proprietorships where one employee was the owner.
The report also highlights the fact that there was a major increase in the small business ownership among women of color and especially blacks and Hispanics.
The data, which was collected from the Census’ Survey of Small Businesses Owners, also indicated that one possible reason for this impressive increase in women venturing out on their own was due to the impact of the high rates of blacks and Hispanics finding themselves unemployed during the years between 2007 and 2012. These same women were also more likely to be the financial heads of their households at that time.
Carla Harris, the chair of the National Women’s Business Council (who was appointed by President Barack Obama), said, “We speculate that there may have been a bigger necessity among women of color to start their own businesses… Necessity is the mother of invention.”
Harris also adds that apart from the unemployment factor, the growth in the number of women business owners could be, in part, due to “increased necessity for women of color to supplement either their existing income (as they are often paid substantially less than the national average) or creating a primary source of income.”