Women entrepreneurs make a huge contribution to the UK economy both creating jobs and driving economic growth. It is right that we celebrate the contribution they make, but women still do not set up businesses at the same rate as men.
FSB is the leading business organisation for small businesses and the self-employed, and we have an important role to play in promoting the value of business ownership championing women’s entrepreneurship.
This report highlights the significant contribution women led businesses make to the UK economy, and I am delighted to see that the contribution to economic growth has increased significantly, alongside a significant increase in the number of people employed.
This report also shows that, despite the increase in the economic contribution of women’s entrepreneurship, women owned businesses are still under-represented in the fastest growing firms. We need to be inspiring women and young girls to think about alternative business sectors – and celebrating positive female role models within these sectors.
The UK should be aspiring to be the best place in the world for women’s entrepreneurship, but to be able to create the right evidence base and to understand how to make the right interventions to support women to grow and to set up businesses, the data collection needs to be improved.
As this report illustrates, there is still more to be done to support women to think about entrepreneurship, doing so will lead to more jobs being created, economic growth and a more diverse and representative small business community.
We need to be inspiring women and young girls to think about alternative business sectors – and celebrating positive female role models within these sectors.
Developing and supporting women’s enterprise is proven to be critically important for overall business and economic prosperity. This report documents the increasing importance of women owned businesses to the UK economy and particularly the economies of the devolved nations, both in terms of increased contribution to Gross Value Add (GVA) and especially to employment.
The report complements FSB’s previous report, ’Women in Enterprise: The Untapped Potential’ and provides a commentary and recommendations on the gendered business data available in the UK. Findings focus on the economic contribution from women owned businesses, with benchmarking against a variety of sources including data for women led businesses, overall GVA contribution, employment contribution and the position in other nations. Evidence of key data gaps is supplied, in addition to examples of good practice.
The following findings are based on analysis of UK data supplied by the Department for Business, Innovation and Skills (BIS) and the Office of National Statistics (ONS) between 2012 and 2015:
Women Owned Businesses
- Women owned businesses contribute £105bn GVA to the UK economy, an increase of 40% since 2012
- In the context of total GVA, women owned businesses are increasing in importance. They now represent 6.3% of GVA, up from 5.1% in 2012
- The average GVA per head contributed by women owned businesses has increased to £36k, although when benchmarked against overall UK GVA per head, the contribution from women owned businesses has decreased from 81% to 79% of the average GVA per head from all businesses
- The decrease in average GVA per head is driven by a reduction in England. In Wales the contribution is static, with a slight rise in Scotland and a larger rise in Northern Ireland
- In contrast, the contribution from women led businesses has increased to 78% of the average GVA per head from all businesses, with rises across all constituent UK nations
- Employment in women owned businesses has increased by 26% to 2.9m. The employment contribution from women owned businesses represents 11.3% of total private sector employment, up from 9.8% in 2012
- The increase in employment is much greater in Northern Ireland (54%) and Scotland (51%) than in England (22.6%) and Wales (13.27%).
Women Led Businesses
- Women led businesses also evidence an increase in employment and now represent 12.55% of total private sector employment, up from 10.34% in 2012
- Women are of growing importance to the UK economy. Women owned and women led businesses now contribute a total of £221bn GVA to the UK economy, representing 13.3% of GVA
- Of particular note is the significant provision of employment. Women owned and women led businesses now provide a total of 23.85% of private sector employment.
Overall, consistent and regular gender-disaggregated business ownership data is lacking, both at UK level and for the devolved nations. Existing data fails to deliver robust measurement capability, especially at devolved nation, sectoral and firm size level. The current lack of data presents a significant barrier to policy formation and best practice identification, effectively holding back the current economic contribution from women owned and women led businesses. A disturbing situation given the growing importance of women in terms of employment creation and business growth for the economies of the UK and devolved nations.
It is crucially important for policymakers to acknowledge the key role of improved future data provision, to help inform best practice, identify opportunity areas, and focus policy responses in order to address the full potential of women owned and women led businesses.
- Increasing the Small Business Survey sample for each UK nation to at least 400 for both women owned and women led businesses to bring it closer in line with the overall margin of errors experienced in the wider Small Business Survey
- Widening the scope of official survey to include questions of more relevance to female business owners and managers For example, in terms of needs based, gender-specific business support provision and factors affecting innovation, resilience, training, and employment
- To address the critical gap in gender-disaggregated data, the Government could explore the potential of adding a voluntary tick box to the VAT Return form - or the Annual Returns form submitted to Companies House
- All Government supported enterprise development programmes should also be equality impact assessed, to review the impact on women at the budgeting, design, implementation, monitoring and evaluation stages Evidencing the implementation of current Government policy commitments to women’s enterprise across all small business policy and programmes
- Benefits can be gained from adopting the best practice approaches to data and business support for women evidenced by the US and Canada, which have seen increased women’s business ownership and increased contribution to employment
The research aims to set a measurement baseline for the economic value (GVA) of women owned business and women led businesses to the UK economy - identifying current gaps in the provision of gender-disaggregated economic data - and establishing the measurement baseline within constraints imposed by these data gaps. The main objective of the research is to inform economic and business support policy at both UK government level and also within the devolved governments of the UK. In addition, the research findings will seek to both influence future official data gathering processes in relation to majority women owned and women led businesses and to identify areas for further research.
This report has been developed through a partnership project bringing together a range of expertise including the University of Portsmouth (UOP), the Federation of Small Businesses (FSB) and Women’s Enterprise Scotland (WES). The UOP has led on the quantitative GVA (Gross Value Added) data creation and analysis elements; the FSB provided access to their own relevant data, including analysis undertaken via the UK government’s Small Business Surveys of businesses with and without employees; and WES provided potentially relevant supporting data sources, including identification of policy implications, and also writing the final report.
A key output of the research is the overall estimated contribution to GVA in the UK by majority women owned businesses and also women led businesses. The research also highlights variations across the four devolved nations of the UK. It is anticipated that the findings will result in significant interest from a range of bodies, including government departments, policy makers, financial institutions, business support providers and economic development agencies.
 Majority women owned businesses are those SMEs in which more than 50 per cent of the ownership or control is held by one or more women
 Women led businesses are those SMEs where women make up more than 50 per cent of the partners or directors in day-to-day control of the business, or where the sole proprietor is a woman
 For the purposes of the study, unless otherwise specified the data discussed for women owned and women led businesses refers to businesses with up to 250 employees
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