The Sixth Annual State of Women-Owned
Businesses Report, Commissioned by American Express OPEN Finds More
than 1,000 Women-Owned Businesses are Formed Each Day
Number of Firms Owned by Women of Color More
Than Doubled Over Past Nine Years
Over the past nine years, the number of women-owned firms has
grown at a rate five times faster than the national average,
reaching a post-recession high, according to the 2016 State of
Women-Owned Businesses Report, commissioned by American Express
OPEN (NYSE:AXP). The sixth annual report, which is based on
historical and current U.S. Census Bureau data and Gross Domestic
Product data, found that between 2007 and 2016, the number of
women-owned firms rose by 42% with women starting 1,072 (net) new
businesses per day. Additionally, the report indicates that
women-owned firms now number 11.3 million, employ nearly 9 million
people and are generating more than $1.6 trillion in revenue.
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2016 State of Women-Owned Businesses
Report Commissioned by American Express OPEN (Photo: Business
Wire)
Women-owned firms are outpacing the national average in both job
creation and revenue generation post-recession. Employment growth
among women-owned firms is strong with an increase of 18% since
2007, while hiring declined 1% among all businesses during the same
time period. In addition, business revenues among women-owned firms
increased by 35% since 2007, compared to 27% among all U.S. firms.
With this growth, women are now the majority owners of 38% of the
country’s businesses, up from 29% in 2007.
“We are pleased to see the continued rise of the vital role that
women-owned businesses play in our country’s post-recession
recovery,” said Susan Sobbott, president of American Express Global
Commercial Payments. “We are inspired by these women who are
continuing to pursue their entrepreneurial passions, and are
strengthening our communities and economy even further.”
Significant growth in firms owned by women of color
Among women-owned firms, one of the fastest growing sectors are
businesses owned by women of color. Over the past nine years, the
number of firms owned by women of color more than doubled,
increasing by 126%. In addition, the nearly five million businesses
owned by women of color make up almost half of all women-owned
firms. These businesses employ two million workers and generate
$344 billion in annual revenue.
When comparing the growth in the number of firms owned by women
of color with women-owned firms overall, nearly eight in 10 (79%)
of the net new women-owned firms were started by a woman of color
since 2007 (an increase of 2.8 million).
As of 2016, there are an estimated:
- 1.9 million African American
women-owned firms;
- just under 1.9 million Latina-owned
businesses;
- an estimated 922,700 Asian American
women-owned companies;
- 153,400 Native American/Alaska Native
women-owned enterprises;
- and approximately 31,100 Native
Hawaiian/Pacific Islander women-owned firms.
Women-owned firms are geographically dispersed
The five states home to the greatest number of women-owned firms
as of 2016 are:
1. California
2. Texas
3. Florida
4. New York
5. Georgia
The top metropolitan areas by number of women-owned firms as of
2016 are:
1. New York City
2. Los Angeles
3. Miami
4. Chicago
5. Atlanta
Since the recession, the greatest growth in number of
women-owned firms was seen in the South. Eight out of the 10
fastest-growing states for number of women-owned firms between 2007
and 2016 are located in that region and are: Florida, Georgia,
Texas, Michigan, Mississippi, South Carolina, Tennessee, The
District of Columbia, South Dakota and Louisiana.
Industry trends
In the wake of the recession, women are turning to traditional
industries such as lifestyle and services companies. Between 2007
and 2016, the following four industries saw the greatest increase
in the number of women-owned firms:
- other services (e.g. home care to hair
and nail salons and pet care businesses), up 98%;
- administrative, support and waste
management services (including janitorial and landscaping
businesses as well as office administrative support and travel
agencies), up 64%;
- accommodation and food services, up
62%;
- and construction, up 56%.
New in this year’s report is a look at the industry composition
of women of color, which found that there are more African American
women-owned firms in both the other services sector and health care
and social assistance sector than any other ethnic group.
Additionally, female Asian American-owned businesses are more
concentrated in the accommodation and food service sector, while
most Latina-owned firms are found in administrative, support and
waste management services businesses.
View the full 2016 State of Women-Owned Business Report,
here.
Methodology
The 2016 State of Women-Owned Businesses Report, commissioned by
American Express OPEN, is based on data from the United States
Census Bureau, specifically their quinquennial business census, the
Survey of Business Owners (SBO), which is conducted every five
years in years ending in 2 and 7. Data from the past three Census
surveys – 2002, 2007 and 2012 – were collated, analyzed and
extrapolated forward to 2016, factoring in relative changes in
Gross Domestic Product (GDP) not only nationally but also at
industry, state and metropolitan statistical area levels. All GDP
data were obtained from the Bureau of Economic Analysis (bea.gov) –
another bureau, like the Census Bureau, within the U.S. Department
of Commerce.
Specifically, growth in GDP from 2002 to 2012 ($10.6 to $16
trillion) was compared to that from 2012 to the fourth quarter of
2015 ($16 to $17.2 trillion). Relative annual growth rates were
then used to estimate the growth in the number of firms over the
2012 to 2016 period – thus adjusting a straight-line extrapolation
to account for relative economic growth between the two time
periods. This was done not only at the national level, but also by
applying actual gross state, metro area and industry-level output
figures (which were available up to the fourth quarter of
2014).
About American Express OPEN
American Express OPEN is a leading payment card issuer for small
businesses in the United States and supports business owners and
entrepreneurs with products and services to help them run and grow
their businesses. This includes business charge and credit cards
that deliver purchasing power, flexibility, rewards, savings on
business services from an expanded lineup of partners and online
tools and services designed to help improve profitability. Learn
more at www.OPEN.com and connect with us at openforum.com and
twitter.com/openforum.
About Womenable
This report was prepared for American Express OPEN by Womenable,
a research, program and policy development consultancy whose
mission is to improve the environment for women-owned businesses
worldwide. Womenable pursues this mission by working with the
stewards of women's entrepreneurship around the world – policy
makers, multi-lateral organizations, corporate decision makers,
entrepreneurial support organizations and the women's business
community – to evaluate, implement and improve policies and
programs to support women's enterprise development. Learn more at
womenable.com.
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M BoothAlex Della Rocca212-539-3203Alexd@mbooth.comorAmerican Express OPENHeather
Norton212-640-0496Heather.A.Norton@aexp.com
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