Women’s entrepreneurship activity is growing

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06.01.2023
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Despite the growing number of growth-oriented female entrepreneurs worldwide, women entrepreneurs still face barriers to building and growing a sustainable startup business, according to the 2021/22 Women’s Entrepreneurship Report: From Crisis to Opportunity by the Global Entrepreneurship Monitor. Switzerland received mid-range scores across most evaluated parameters.

The COVID-19 pandemic in 2020 and 2021 presented perhaps one of the greatest collective crises worldwide, affecting both large and small businesses. The Global Entrepreneurship Monitor (GEM) has studied its impact on the total entrepreneurial activity (TEA) for women. The organisation has published the GEM Women’s entrepreneurship report, which presents findings from GEM 2021/22 data on women’s entrepreneurship in 50 countries. This year the report highlights the gender composition of high-potential startups, pandemic impacts and factors in the enabling environment that influence gender differences in TEA.

According to the report, women globally are less active than men in startup activity; on average, 10.4% of women surveyed versus 13.6% of men surveyed. Moreover, women represent about one in three high-growth entrepreneurs and one in three innovators focused on national and international markets. In upper–middle–income countries, women represent about one-third of all entrepreneurs starting high-growth businesses and are at parity with men regarding international market focus.

Clear growth from 2019 to 2021
The impact of COVID-19 led to declines in intention to start a business for both men and women but surprisingly, this was not the case in upper–middle–income countries. Both startup intentions and rates for women rose by 4% and 11%, respectively, from 2019 to 2021.

Regarding access to key resources for successful entrepreneurship, women in upper–middle–income countries received equal support as their male counterparts, as opposed to the significant disparity in lower-income countries where women are the least likely to report knowing another entrepreneur.

Europe, a breeding ground for women with high-growth businesses
With 23 European countries participating in the Survey, Europe presented the lowest TEA but generally higher rates of gender parity compared to other parts of the world. Women in Europe represent one-third of the early-stage entrepreneurs with 20+ employees and expect to hire 20+ employees within five years. The Female–male ratio of TEA is almost at parity across all participating European countries, with the Netherlands having the highest female rates (13 percent women compared to 15.4 percent males) and the lowest in Poland and Norway.

While women in Europe are some of the most impactful and privileged women entrepreneurs in the world, they still face significant barriers to success in their enabling environments. Besides funding with the rise of women investors being a promising trend for women entrepreneurs, other critical factors in the enabling environment are confidence to start a business, networks, and cultural support. Unfortunately, data from the GEM National Expert Survey (NES) show negative European scores for cultural support and favourable regulations for women entrepreneurs at the regional level.

Switzerland a mediocre performer
In Switzerland, the rate of women with entrepreneurial activity (TEA) is 7.2%, compared to 12.4 for men. Although the pandemic provided equal opportunities for both genders, intentions to start a business among Swiss entrepreneurs however vary only slightly among the genders (12.1 percent women compared to 14.9 percent men). Compared to other high-income countries, Switzerland's performance regarding female entrepreneurial activity is thus mediocre (See graph).

Women TEA varies across sectors in Switzerland. Women in ICT account for eight percent compared to 11 percent of the men and 16.3 percent in the new digital overall. The report found that women dominated Manufacturing and Transport (12 vs 10 percent) and wholesale and retail (16 compared to 13 percent for men) sectors. The highest rates were recorded in financial, professional and administrative consumer services (20 percent compared to 41 percent for men) and the least in Agriculture, Forestry and Mining.

Unfortunately, access to support for female entrepreneurship remains significantly lower at a local, national and national level, with men getting double the support than their female counterparts in Switzerland. Rates capturing business investments in the past 12 months varied for women from a low of 1.3% in Italy to a high of 8.7% in Sweden and Switzerland.

Irrespective of the gender gaps and barriers for women to start a business, the report has overall delivered promising results on women’s TEA. For more details download the report.

(Ritah Ayebare Nyakato)

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