It may go without saying that small businesses are the driving force behind America’s economy; of course, that doesn’t stop politicians from saying exactly that on a daily basis. All in all, there are almost 28 million small businesses across the nation, with including about 22 million self-employed business owners with no additional payroll or employees.
This also includes a growing number of women entrepreneurs and business owners. In fact, women-owned firms are experiencing more growth than ever before, and these companies are finally getting the recognition they deserve.
Within the past nine years, women-owned businesses have grown 45% nationwide, with employment rising a full 18% since the Great Recession of 2008. The revenue of these businesses has increased one-third since 2007, totaling $1.6 trillion in revenue last year. But despite all these successes, women entrepreneurs have to face numerous biases as well.
However, the tide might finally be turning.
According to the 2016 State of the Women-Owned Businesses Report, the long-standing gender wage gap is slowly shrinking. Not only has the federal government backed plenty of programs focused on building women’s entrepreneurship skills, but last year the government also awarded 5% of all federal contracts to women-owned businesses for the first time ever.
While the wage gap hasn’t closed completely, this progress shows that the federal government is recognizing women entrepreneurs as crucial drivers of economic growth.
At the same time, a Biz2Credit study of more than 25,000 companies found that the annual average revenue of women-owned companies grew an astounding 47% between 2015 and 2016, with their annual earnings jumping 61% in that time.
As the gender pay gap continues to shrink, there are more opportunities for women entrepreneurs to secure loans. CNBC reports that loan applications from women-owned companies are growing particularly fast in California, Georgia, New York, North Carolina, and Texas.
But according to Anita Campbell, the founder of SmallBizTrends, the lending industry can still take steps to help women entrepreneurs grow their businesses.
“The SBA and lending industry can do more to educate women on the underlying steps to make their businesses more credit-worthy and attractive to lenders,” Campbell told CNBC. “As women business owners, we may think there’s not much we can control in the lending process, but that’s not true. There are a lot of small building blocks to getting a loan. We can work on those building blocks once we know what they are — and get the financing that positions us to achieve our business dreams.”