Guest post provided by Candida Brush, Franklin W. Olin Professor of Entrepreneurship at Babson College
For the first time since 2008, we have evidence that entrepreneurship is on the rise in the U.S. Results of the Global Entrepreneurship Monitor study carried out during the summer of 2011, shows that 12.3% of working adults (18-64) in the U.S. were starting or running new businesses.(1) This is a significant rise from 2010 when only 7.7% overall were engaged in starting or running a business. More notably, the rate of women’s entrepreneurship is creeping upwards, in that for every 10 men starting a business, there are 8 women. Today women own approximately 30% —a total of 7.8 million—of companies in the US and generate $1.2 trillion a year in sales. These are impressive statistics, yet the gap that still exists between men and women is disheartening.
There are myriad and complex reasons for the gap. One may be the difference between women and men regarding perception of their own capabilities. Interestingly, 47% of women believe they have the capabilities to start a business while that number rises to 64% for men. This is nearly 17 percentage point difference. (GEM USA 2011) The most vulnerable group is young women who are less likely to see opportunity and have a higher fear of failure.
It’s not surprising when you consider how societal attitudes about entrepreneurs play a role in discouraging younger women. The myth that entrepreneurs are heroic, risk taking, innovative individuals who are born with these traits is still pervasive. If I ask any class full of students to name an entrepreneur, they will almost always shout out the names of Bill Gates, Jeff Bezos, or Mark Zuckerberg. The characteristics of entrepreneurs are nearly always associated with male entrepreneurs. And so the combined effect of young women being socialized to do something other than entrepreneurship, along with the role modeling of entrepreneurs as male heroes, might just discourage younger women, thus causing a higher fear of failure, lower perceptions of capabilities and a lower likelihood of seeing opportunities.
If we are going to close the gender gap, we need to make sure that our younger women are prepared the same as our younger men to expect to be economically independent, and see entrepreneurship as a viable career. In addition, the stories of successful women entrepreneurs need to be disseminated more widely, teaching materials need to equally showcase women as protagonists and we need to celebrate role models of women entrepreneurs of all kinds.