Background to the National Unit for Women's Enterprise

Women's Enterprise in Scotland

Introduction

This website has been developed by Scottish Enterprise as part of a programme of initiatives to encourage more women in Scotland to start up in business. It complements a range of other activities and initiatives that are being undertaken such as a Networking, the Microcredit programme, Business Investment for Growth and the Women into Business Conference (details of these and other initiatives are included throughout the site).

The aims of the site are to give women the information and advice they need to develop their business ideas, to connect them to those organisations that can provide training and support and to provide the opportunity to network with like-minded people in other parts of the country - or indeed the world!

Context

Over the past twenty years the number of women entering self-employment and business ownership in the UK has increased substantially, from 319,000 in 1979 to 840,000 in 1997. However, the rate of female self-employment has increased to a much lesser extent, from 3.12 percent of total female economic activity in 1979 to 6.76 percent in 1997. Women still constitute only a minority (26 percent) of the self-employed and there is some evidence to suggest that around 75 percent of female self-employment is undertaken in a part-time capacity.

In Scotland, the proportion of female self-employment is even lower than for the rest of the UK, and research suggests that the number of Scottish women converting an interest in self-employment into the reality of business ownership is less than 30 percent compared with 56 percent in South East England.

In 1994, Scottish Enterprise published 'Women starting business - Making it happen' report, which followed on from the 'Business Birth-rate' Strategy of 1993 and examined Scotland's position in relation to the numbers of new businesses created by women. The strategy proposed that increasing the number of businesses started by women, young people (under-35s) and 'blue-collar' social groups was key to pursuing higher levels of new business creation and of bringing Scotland closer to the position of other UK regions.

This report provided the framework for actions and initiatives for those public and private sector partners involved in economic development to give greater encouragement and support to women to set up more new businesses.

Progress has been made

Mori research in 1997 which examines interest and predilection for starting a business highlighted that over 350,000 women have an interest in starting a business and that 90,000 women in Scotland have a serious interest (and already have a business idea) - these figures have been increasing since the benchmarking began in 1992.

Furthermore over 40 percent of attendees at the recent series of Personal Enterprise Shows in 1999 were female- this is an increase from the first series in 1996/7 where female attendance was around 30 percent.

There is now more public sector support for women's enterprise- across the Scottish Enterprise network a wide range of general and women-specific activities are offered and women of course, have access to all the mainstream new start and business development activity.

International trends show significant increases in the number of women entrepreneurs across the globe. In North America particularly, a growing number of businesses are now established and owned by women. There are now more than 8 million women-owned enterprises (up from around 400,000 in 1970) and they employ more than 20 percent of the US workforce. Trends in Europe are more difficult to quantify but across the EU women's businesses account for around 33 percent of total businesses the range of women-specific business initiatives is increasing, particularly in Scandinavia and Western Europe.

Women are not yet converting in significant numbers

The importance of women as a largely untapped pool of entrepreneurial talent has been widely recognised by economic development agencies. Yet despite a broad awareness of the economic importance of women's business ownership and a number of initiatives designed to stimulate female self-employment, women can sometimes require more sustained support to convert their interest in business into firm action.

Moreover, the levels of women interested in growing their businesses are disappointingly low. Scottish Enterprise research into 500 female-run businesses in 1997 highlighted that 97 percent of the businesswomen were interested in growing their businesses but around 80 percent had no firm plans to make that happen. Women currently only account for around 10 percent of the total number of high growth businesses, and this figure has been static for 3 years.

Research, by Business Enterprise Scotland and Scottish Enterprise in 1997, highlighted that 68 percent of women in business felt that they were not taken seriously by the business advisory networks and 40 percent of women did not approach the banks for finance, as they perceived that they would be rejected. 68 percent of women also indicated that they lacked confidence.

It is also known that women only access 30 percent of the capital resources that men access and that this under capitalisation of their business ventures can have a detrimental effect on business performance and on growth potential.

The figures are particularly disappointing given the range of current factors and trends that were expected to stimulate and broaden female entrepreneurial activity. For example: the growth in the number of working women; unprecedented levels of female rates of remuneration; an overall expansion in the services sector; the fragmentation and growth of local markets; the increase in 'feminised' markets; and the development and diffusion of home-based communications technologies, all appear to have had little impact on the rate of female self-employment.

Research on female enterprise has been limited. But those studies that have been undertaken have demonstrated gender differences in aspects of female entrepreneurial activity from pre-venture experience; motivations for ownership; the level of constraints in accessing finance and other resources required for start-up and business growth; and in the development and management of the business.

Many of these issues have been recognised by economic development agencies, but the low numbers of women growing their businesses and seeking high-growth businesses suggest that some of these issues remain unresolved. It is for these reasons that national research is being undertaken to help influence and guide future strategy and a range of initiatives and consultations are being undertaken to explore the issues and establish activities to increase and broaden women's participation in enterprise across Scotland.