State Policy Recommendations for Investing in Women Entrepreneurs

The impact of women-owned businesses on the economy is impressive. Women entrepreneurs are increasing their business impact by leaps and bounds. Yet, the power and potential of this sector of our economy is still a secret to most policymakers—despite the fact that women are contributing to the economic prosperity in every state and are effective in creating new jobs. The Center for Policy Alternative’s groundbreaking report on State Venture Policy: Investing in Women Entrepreneurs, shows how state policymakers can do even more to leverage this powerful engine of growth in local economies.

State Venture Policy, sponsored by Bell South Corp., provides the first state-by-state analysis of how states are allocating their resources to develop this sector. Key findings from a national survey of business assistance centers and economic development agencies are featured and innovative strategies are suggested to improve the types of services offered to women-owned businesses.

"Unleashing the economic power and potential of women is good for families, communities and the economy. When women-owned businesses do better, the economy does better," stated CPA President Linda Tarr Whelan during the press conference to release the report findings in Atlanta, Georgia.

Over the last dozen years, annual sales of women-owned businesses have grown by an unbelievable 436%, according to the National Foundation For Women Business Owners. These businesses employ over one-quarter of U.S. workers and generate over $3.6 trillion in sales. This trend is likely to continue.

The bad news is that despite this tremendous growth potential, states have not put together clear and comprehensive strategies to tap the entrepreneurial spirit of women. Women own 38% of all businesses, but only 18 states have an economic development plan that includes furthering the strides of these businesses. Even fewer states–only 13–collect and analyze the growth and development of women-owned companies. And while many states offer training and education programs for women business owners, women have trouble accessing these programs due to problems of cost, time and transportation. Although the majority of states are engaged in the global economy, they have not integrated women-owned businesses into that strategy.

In a time when states are promoting business development and sustained economic growth, they must implement strategies that move these businesses ahead. According to The Global Entrepreneurship Monitor, a national report released by the Kauffman Foundation, the continued success of an entrepreneurial economy lies in promoting women’s entrepreneurship.

The policy recommendations for states were released at a joint press conference in Atlanta, Georgia in late February, featuring Georgia Governor Roy Barnes, Lt. Governor Mark Taylor, Senator Connie Stokes (herself an entrepreneur) and Linda Muir, Executive Director of Corporate Relations for BellSouth Corporation. Each spoke about the strong role that women-owned businesses play in both national and state economies.

"As a state leader, I have realized that women’s entrepreneurship is essential to a flourishing economy. I want to learn about the best practices available that help this very important sector grow so that I can go to my committees and endorse policies that will move us forward," stated Stokes.

Unless women are full partners in the economic life of states and nation, economic prosperity will not continue and economic power will not be sustained.

Policy Options

State Venture Policy offers a number of policy options for states to give women-owned businesses help in accessing financing, training and education; to improve their data collection and analysis; and to create an entrepreneurial environment:

• Clear away the obstacles: Ensure that women are fully represented in economic development planning and decision-making, are accessing existing programs (or create new ones) and that they are integrated into global strategies and new technologies.
• Know how well this sector is doing in the state economy by measuring the impact of entrepreneurship in general, and women-owned businesses in particular.
• For economic growth and particularly job creation, develop policies that promote business growth from the micro to the mezzo level.
• Build public/private partnerships to support the start-up and growth of women-owned businesses including leveling the procurement playing field.
• Develop innovative community investment strategies for progressive workforce benefits (particularly retirement and family and work) for employees of small and mid-sized companies.
• Follow this link to view the online copy of State Venture Policy or contact Ericka Hines.