Recently I spoke at Facebook’s virtual meetup event #SheMeansBusiness to celebrate Women’s History Month and acknowledge the vital role women play in America’s history, society, and economy. And while the month of March has now come to an end, our commitment to helping women prosper should not.
Before the pandemic, we would boast that women business owners represent the fastest growing economic sector in the country, employing 9.4 million and generating $1.6 trillion in revenue. Though the pandemic has been difficult for everyone, women-owned businesses were disproportionately impacted in comparison to their male counterparts.
According to Facebook’s State of Small Business Report, female-led small businesses reported greater reductions in sales than their male counterparts. While both female and male-led businesses reported that their sales had fallen, a greater proportion of female-led businesses (47%) reported that sales fell by 50% or more compared to male-led SMBs (41%).
Women business owners with school-age children are facing unprecedented times in work and at home. According to a Gusto-NAWBO Report, 61% of women owners with children at home report that school closures have impacted their business, and 30% of such owners reported scaling back due to childcare needs.
So how can we help women-owned businesses and ensure valuable progress in female entrepreneurship isn’t wiped out by the repercussions of the pandemic?
Here are 10 things that women entrepreneurs and lawmakers who want to support women entrepreneurship can and should be doing to help women-owned small businesses—not just in March—but every day of the year.
1. Provide better access to capital
We need to examine our system’s structures to ensure all women business owners are included in traditional avenues to access working capital and funding. Whether this means venture capital, banking, or government-run programs such as the Paycheck Protection Program (PPP), more needs to be done to level the capital playing field. Further, more education is needed about alternative sources of funding available to businesses, including fintech challengers, as well as grant programs that focus specifically on underserved groups.
For example, last year Facebook provided support to small businesses impacted by Covid-19 with its Facebook Small Business Grants Program. Olivia Colt, owner of Oakland, Calif.-based Salt & Honey Catering, was a recipient of the grant and was able to use the funds to pivot her catering business online. Olivia noted the biggest pre-pandemic challenges she faced was being a woman of color with a disability in an incredibly fast-paced and competitive industry. But when Salt & Honey received cancellations for all of its scheduled events in 2020, she knew she had more obstacles to overcome.
She used funds from the grant to support the transition of an in-person catering and event company to become a local online subscription grocery box delivery. Through the subscription box, she’s also supporting other local small businesses by including their products in each box. Now, she’s expanding her business to include an online order platform, and she’s even hired some new staff.
2. Embrace the digital economy
We know that since the pandemic started, the importance of having a digital presence has increased significantly, as e-commerce trends have accelerated rapidly for consumers and businesses alike. In fact, according to a recent study by Facebook conducted by Deloitte, 84% of business owners started using or increased their use of digital tools since the outbreak of coronavirus.
Successfully navigating the digital economy will be essential for long-term small business success, and we need lawmakers and the Small Business Administration (SBA) to empower business owners with the resources they need to build their businesses online.
In short, businesses need access to digital tools to have a fighting chance in the 21st-century economy. That’s why as Congress looks at an infrastructure bill in the coming months, we must find solutions to provide business owners and consumers with affordable, reliable broadband as well as other resources to power digital experiences that will increasingly become the norm.
3. Understand the modern woman worker
To support women-owned small businesses, it’s imperative that we understand the modern woman worker. This means considering how to preserve flexibility and challenging preconceived norms about how businesses should operate, making room for today’s female entrepreneur who wears many hats and balances many responsibilities—both personally and professionally.
4. Lead with empathy
According to the National Women’s Law Center, the women’s labor force participation hit a record 33-year low in January. In addition, recent studies have found that women are leaving work or reducing their hours at a much higher rate than men due to childcare needs. As Facebook’s recent research found, family responsibilities were a prevalent reason for female employees leaving the workforce: 20% stated that caring for children or children’s education at home was the main reason they could not work, compared to just 3% for male employees.
For female-owned businesses to succeed, companies and business owners must be empathetic with their employees, especially during this unusual time. Understanding the demands of ad hoc personal crises as well as caregiving is paramount to fueling the success of women-owned businesses.
5. Support women-owned businesses by allowing for grace
The best thing any female entrepreneur can do is to give herself some grace. Though we may try, we can’t always do it all. Prioritizing mental health and establishing boundaries is key to avoiding burnout and achieving long-term prosperity. We need to normalize advocating for ourselves and recognize that we all need time to relax and recharge with loved ones.
6. Know the resources that are available, including the tax code
According to our recent report with Gusto, 27% of women business owners reported that they had claimed tax credits under the Families First Coronavirus Response Act (FFCRA). And while 54% who did not use these credits said it was because “no employee needed Covid sick leave,” one-fifth of owners did not because they were unfamiliar with or unaware of this program.
This is just one example of how important it is for business owners to be aware of the resources at their disposal, including those through the SBA and the tax code. We need to continue to educate businesses on using all the tax credits available, allowing them to take full advantage of the programs designed to assist them.
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