Women-owned businesses adding more to economy, but key sectors lag
Women are increasingly becoming the job creators and growth drivers in the UK, according to new research from the Federation of Small Businesses (FSB).
And North West business leaders have called for more initiatives to encourage female entrepreneurs throughout the region.
The new report, ‘Supporting Women’s Enterprise in the UK: The Economic Case’, shows that women-owned businesses are now calculated to contribute £105bn to the UK economy, an increase of 40% since comprehensive data was last collected and analysed.
This equates to women-owned businesses contributing £36,000 Gross Value Add (GVA) for each person they employ – 6.3% of total UK GVA.
However, despite the rise in female founders overall, the proportionate contribution from women-owned businesses in manufacturing has declined.
Worryingly, the report findings show that over the period studied (2012-2015) there has been a reduction in the contribution of the manufacturing sector to women-owned businesses’ GVA, from 14.9% to 11%, and proportion of employment, from 8.7% to 7.1%.
This is concerning, because manufacturing is a relatively high profit sector.
A larger proportion of women-owned businesses are in the care sector, which has low profit.
The contribution women make to the UK economy is even more significant when the estimated GVA of women-led businesses is included.
The research shows that women-led and women-owned businesses are estimated to contribute £221bn, representing 13.3% of total GVA.
FSB development manager for Merseyside and Cheshire, Phil McCabe, met with Maggie O’Carroll, chief executive of Liverpool-based social enterprise The Women’s Organisation, to discuss the report.
Phil said: “Developing and supporting women’s enterprise is proven to be critically important for economic prosperity.
“The Government, combined authorities and Local Enterprise Partnerships must now address this untapped potential with a range of suitable measures, such as dedicated investment in business support and finance programmes.”
Maggie O’Carroll said she wasn’t surprised by the outcome of the report.
“We have, for years, advocated that if you invest in women entrepreneurs you would be investing in the wider economy.
“The FSB have demonstrated through their research that this is not just something that needs to be done to pay lip service or tick an equality box, but it is vital to avoid losing billions of potential investment.
“It is clear there are still industries where women feel unwelcome and we need to do more to promote role models and develop programmes that offer leadership and development opportunities to bridge that gap.”
She added: “However, the overall picture is that women entrepreneurs are the dark horse now coming to the fore.
“We’d urge economic influencers to capitalise on this success and offer further backing to programmes delivering when it comes to women’s economic development if they want to see true return on their investment.”