Women-Owned Businesses: Dimensions and Policy Issues

Abstract

Women-owned businesses may have grown six-fold, and the gross receipts of these businesses 50-fold over the past 2 decades. Most businesses owned by women, however are small, undercapitalized, situated in retailing and the services, and many enable only part-time work As a result, few women have achieved high earnings from ownership. Our analysis indicates the potential earnings for most women are significantly higher in management positions on payrolls than in self-employment. Women with continuing care responsibilities, however, often are constrained to worksites in or near the home, and to work schedules that complement these allied activities. Many such women seek to own their own businesses largely because they have no alternative. This may change as current employers-facing labor shortages and external pressures-move to accommodate the particular needs of women. We conclude that there is little economic rationale for intense, new public efforts to stimulate or support women-owned businesses, but that the federal government must continue to promote equal opportunity within businesses at large.