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The past 16 years have been filled with burst bubbles, bailouts and a recession that all but crippled the growth of American business. As U.S. commerce steadily begins to recover, growth among all industries and regions has also become apparent. As a recent American Express OPEN study revealed, women-owned businesses have been the drivers of that growth.
The study looked at the growth of women-owned businesses between 1997 and 2013 and compared it with the growth of U.S. business in general, and it made some surprising discoveries.
16 Years of Women-Fueled Growth
According to the U.S. Census Bureau’s 1997 Economic Census, of the 20.8 million businesses in operation at the time of the census, 5.4 million (or about 26% of all U.S. businesses) were women-owned. In 2013, however, that isn’t quite the case.
American Express OPEN’s study found that women-owned businesses now total an estimated 8.6 million, accounting for 29% of all U.S. enterprises. Aside from the largest publicly traded corporations, women-owned enterprises saw the greatest rate of growth from 1997 to 2013:
- As a whole, the number of American businesses increased by 41% between 1997 and 2013; in contrast, the number of women-owned enterprises increased by 59%, about1.5 times the national average.
- When omitting the largest publicly traded corporations, women-owned businesses outpaced all others in terms of both employment (up 10%) and revenue growth (up63%).
The OPEN study found that women-owned businesses now generate over $1.3 trillion in revenue and employ nearly 7.8 million people.
Perhaps the most surprising stat of the study is the rate of growth in employment within women-owned businesses in relation to others. Since 2007, U.S. businesses have added about 5.3 million jobs overall. This stat, however, is a bit misleading, as large, publicly held corporations accounted for 5.9 million jobs. This means that smaller and privately heldcompanies are responsible for a decline of 569,000 jobs combined. Women-owned businesses, however, were the only privately held enterprises that saw growth in employment:
- Among male-owned and equally owned businesses, employment has declined over the past six years; in contrast, women-owned businesses have added an estimated175,000 jobs in that same time period.
Minority Women Making Strides in Business Ownership
The OPEN study further broke down the category of women-owned businesses into racial demographics, and the findings show a big rise in business ownership among minority women:
- In 1997, there were 929,445 businesses owned by minority women; that number has more than doubled to an estimated 2.6 million businesses in 2013.
- Whereas businesses owned by minorities accounted for 17% of all women-owned businesses in 1997, they now account for 31% of women-owned businesses.
These stats show that businesses owned by minority women have more than doubled in the past 16 years. With these numbers, it’s not surprising that the study found staggering growth among businesses owned by women of all minority classes:
- The number of businesses owned by African American women has increased by 258%since 1997.
- Those owned by Latinas have increased by 180%.
- Businesses owned by Asian American women have increased by 156%.
- Ownership among Native American and Alaska Native women has increased by 108%.
To put these numbers into perspective, the number of businesses owned by non-minority women has increased by only 32%.
While growth is expected during a time of economic recovery, what shouldn’t be expected is a particular demographic thoroughly outperforming its peers. Perhaps it’s entrepreneurship finally approaching some form of equality among men and women. Maybe women were more adept at handling the pitfalls of recent economic downturns. Or perhaps men were disproportionately hit hard by the recession. Whatever may be the case, U.S. women of all classes took advantage of those tough times to carve out a larger niche for themselves in the American economy.
Could the recession have ushered in an age of a more empowered American businesswoman? Only time will tell.