Female-owned businesses in Utah growing not in size but in number
It has been 25 years — since 1997 — that a comprehensive study of female business owners in the state was done by the Women’s Business Center of Utah.
This year, the Women’s Business Center conducted an in-depth survey of female business owners to see what changes may have occurred over that quarter of a century.
It was in 1988 that the Women’s Business Ownership Act was passed and established law making it possible for women to apply for a business bank loan without having a male relative as a co-signer.
According to new study, there are 114% more female entrepreneurs nationwide than in 1997, but female-owned businesses employ fewer than 10 workers on average — although, overall, they are considered equally as successful as male-owned businessed when measured by business starts, revenue growth, job creation and number of years in business.
The study notes that Utah women continue to rank low — 39th of 50 states in 2021 — when it comes to the entrepreneurship rate disparity between men and women.
According to Susan Madsen, director of the Utah Women & Leadership Project at Utah State University, “this white paper explored in-depth the experiences of current women business owners to learn from them how Utah is faring.”
Included in the findings:
- Based on the number of women-owned businesses, national data ranks Utah 45th compared to other states, with 16% of the state’s businesses being women-owned. However, Utah ranks second when looking at the increase of women-owned businesses over the last two decades, showing a 77% increase.
- Of respondents, 65.6% personally owned 100% of their business. Across all respondents, the most common industries were advertising, business services and information technology (16.5%); agriculture, construction, engineering and manufacturing (15.3%); and food service, leisure and travel (14.9%).
- A large proportion of women (47.2%) spend over 40 hours a week on their business. Women who worked more hours tended to be older, had fewer children at home and had owned their business longer.
- Many women (44.3%) declared themselves as self-employed with no other employees. Those who do have employees typically reported having one to five workers.
- About a third of female business owners (34.3%) projected gross sales under $50,000 for 2022. A larger proportion of women (41.7%) projected their gross payroll as under $25,000 for 2022.
- Most women relied on personal savings, credit cards, and friends and family to start, maintain and expand their business.
- Women rate their top reasons for starting a business as “to create something,” be independent, make more money and have more flexibility.
- In an open-ended question, women described their biggest barriers as the need to balance life responsibilities, issues related to gender (e.g., not being taken seriously), and the lack of funding and training resources.
- Women described the top advantages to being a female business owner as having soft skills that build relationships and getting support from organizations focused on female-owned businesses.
- For those who cited the impact of child care on operating their business, their top concerns were balancing work and child care and the accessibility of child care for themselves or their employees.
Many resources are available for female business owners. These include the Women’s Business Center of Utah, the State Small Business Credit Initiative and Small Business Development Centers; organizations that serve women entrepreneurs (e.g., Womenpreneurs, She Place); and academic courses and programs offered by public and not-for-profit colleges (e.g., WELift at Utah Valley University).