At an event featuring Small Business Administration Administrator Maria Contreras-Sweet, the Center for American Progress recently released a new report exploring how women of color are a principal force within the U.S. entrepreneurship community and how their success is vital to the U.S. economy. The report lays out the current landscape of women of color entrepreneurs, explores the factors in the traditional workplace that push women of color to start their own businesses, and offers recommendations in order to ensure this vital segment of our population continues to pursue entrepreneurship and thrives. With U.S. Bureau of the Census projections predicting women of color will make up the majority of all women by 2045, the success of entrepreneurial women of color, breaking down of barriers to entrepreneurship, and supporting more equity in the workplace has become vital.
The number of women-owned firms in the United States grew by 59 percent from 1997 to 2013 — one and a half times the national average — and with women of color being the majority owners of close to one-third of all women-owned firms in the nation, they are the undeniable catalyst behind this growth:
- African American women-owned businesses grew by 258 percent.
- Latina women-owned businesses grew by 180 percent.
- Asian American women-owned businesses grew by 156 percent.
- Native American and Alaska Native women-owned businesses grew by 108 percent.
- Native Hawaiian and Pacific Islander women-owned businesses grew by 216 percent.
Women of color are overcoming significant obstacles in order to start their own businesses, some of which include difficulties in accessing capital or bank loans. Still, women of color are increasingly becoming entrepreneurs because they may not be satisfied with their positions in today’s traditional workplaces, where they are overrepresented in the low-wage job sectors with few benefits, have higher unemployment rates than both white women and white men, and continue to be underrepresented in professional and managerial positions. Feeling marginalized or excluded in their workplaces and finding advancement within their workplaces especially challenging, particularly due to their lack of access to networks and the resulting lack of social capital, women of color continue to turn to entrepreneurship.
“Empowering women of color to capitalize on their own talents is a must if we hope to strengthen our nation’s economy,” says Farah Ahmad, Policy Analyst for Progress 2050 at the Center for American Progress, and author of the report. “Their contributions to the economy by providing services, products, and jobs, all while contributing to their own families’ economic stability, is an opportunity. ”