While numbers of women entering labor force are steadily increasing, their participation in entrepreneurship is less favorable. In fact, according to the Kauffman Foundation, an entrepreneurship think tank, women are only half as likely as men to start a business resulting in unrealized potential for their contributions to job creation, innovation, and ultimately economic growth.
Kauffman Foundation released a new study claiming that women would make great entrepreneurs but they often fail to start their own business mostly due to following reasons:
- Shortage of available mentors;
- Perception of entrepreneurship as a masculine activity;
- Additional hurdles maintaining a work-life balance due to parenthood.
However, we can address these barriers as Kauffman highlights 5 ways for policymakers on how to encourage women to start their own business.
- Provide more exact, gender based, data on entrepreneurship programs and initiatives to understand how they can better help women entrepreneurs. Collecting data based on gender will help them to make more accurate decisions in assisting women entrepreneurs.
- Increase the number of women leading entrepreneurship programs. Women can better lead and support other women entrepreneurs by using their networks for accessing mentors, financial capital, and creating women inclusive events that attract women entrepreneurs.
- Increase Small Business Innovation Research (SBIR) awards to women-owned businesses. Although federal agenciesparticipating in the SBIR Seed Fund are encouraging women to engage in federal research/Research and Development, only 15 percent of SBIR awards went to women-owned businesses in 2012. One of the ways to increase this number is to partner with women’s professional organizations and make better effort of reaching out to women entrepreneurs to participate in these programs.
- Share stories of successful women entrepreneurs. Celebrating accomplishments of women entrepreneurs will change the false perception that only men are successful entrepreneurs and encourage more women to follow successful women in business.
- Decrease the risk of becoming an entrepreneur. Pressure and risks that women as entrepreneurs are facing, especially with young families, can discourage them of starting in the first place. By exploring various policies such as subsidized childcare or preschool, can help alleviate the pressure and create a more favorable environment for women to start their own businesses.
Read the full study here.