A customer looking from the outside can’t usually guess who the owner of a business is. Whether it’s a man, a woman, or a nonbinary person running the show, a business has to make money and make customers happy in order to flourish. Since women make up roughly half of the population in the U.S., it would make sense if they owned half of all businesses. Yet, this is obviously not the case. While there are many factors to consider when it comes to running a business, gender does have an impact on small business owners.
Access to Business Loans and Capital
What can make or break a business is whether or not the owner can access the appropriate and necessary loans and capital to reach a stage where the business is profitable. The statistics in this area reveal a startling reality.
Compared to businesses owned by men, the average loan size for a woman-owned business is 33% smaller, according to Lendio. This shows that women do not have access to the same level of business funding, which inevitably has an impact on whether or not women open businesses in the first place. If a person cannot get the amount of funding necessary to open a business, then that person will have to choose another career path.
Lack of Gender Representation and Mentors
In order for women to believe that they can open businesses, they have to see other women represented as business owners and mentors in various industries. Gender representation is a crucial element in the way that industries develop and change. It’s very difficult to be the first woman in any one industry. There’s a high chance that the person who tries to break new ground will face extreme isolation and unique difficulties that her other peers do not.
For an industry to welcome more women as business owners, gender representation needs to be a top priority. Ideally, new business owners will have a network of mentors to work with who already understand the hardships and obstacles ahead. Having a network is critical to success as a business owner, and women need to be able to connect with other women in order to achieve stability and profitability as business owners.
Gaps in Equal Pay and Benefits
As women enter the workforce, they run into the issue of the gender wage and benefits gap. In America, the gender wage gap has mostly remained consistent since the early 2000s. Women make less money than men when performing the same jobs. Over time, this impacts women’s savings and their abilities to move into an industry as business owners. It also results in weaker benefits packages, especially when related to having children.
Researchers still need to learn more about how the gender wage gap impacts women business owners. However, it’s a disheartening reality that women face from the time they enter the workforce. So it is likely that it affects the way that women imagine their futures as professionals. This is even more true for women of color, who experience a much more significant wage gap than white women.
Childcare as a Burden and Hurdle
Having children drastically affects women’s career aspirations and professional realities. Even though many aspects of gender equality exist in society, there is still a huge disparity when it comes to childcare. Women often do three times as much work when it comes to caring for their children in comparison to their husbands. This unfair burden results in many women preferring to prioritize their domestic tasks over high-stakes careers.
Even the event of having a child exists as a hurdle to many women succeeding in the workforce as both employees and business owners. Pregnancy and childbirth are taxing and time-consuming. Many women feel that they have to choose between pursuing their professional goals or having children.
To increase the amount of women-owned businesses, society needs to support mothers with policies aimed at providing universal childcare. Once society addresses this hurdle and the gender wage gap, women will be freer to open their own businesses.
Passionate Writer, Blogger and Amazon Affiliate Expert since 2014.