The number of women entrepreneurs has risen significantly following the pandemic, with females creating nearly half of new U.S. businesses for the third consecutive year.
Key Details
- In 2022, women created about half of new U.S. businesses for the third year in a row.
- Before the pandemic, only 29% of new U.S. businesses were created by women, according to a survey by small business payroll firm Gusto Inc.
- The survey shows that 41% of all business owners reported starting their business out of financial necessity amid high inflation, up from nearly 25% in 2021.
- Women were primarily driven to start a business from a desire for flexibility and financial stability.
Why it’s news
The amount of new businesses in the U.S. is growing rapidly, and women looking for job flexibility and financial stability are the driving force in the entrepreneurial market.
In the years following the COVID-19 pandemic, more women are becoming entrepreneurs. In 2019, 29% of women were starting new businesses, and in 2022 that number reached 50%.
The number of new businesses often rises during economic trouble, and the recent economic issues have been no different. A large majority of business owners reported creating their company out of financial necessity amid high inflation when that number was much lower a year before.
In 2019, 3.5 million business applications were filed. Last year, nearly 5.1 million were filed—almost 14,000 per day— and even more were filed in 2021, according to the Census Bureau.
All demographic groups in the Gusto survey cited flexibility as the top reason to start a business—like working from home.
Workers aged 35 to 54 were most likely to say they started their own businesses because they were burnt out from their jobs and wanted more control over their schedules. This feeling was prevalent for women, as most reported starting a business for flexibility and financial reasons.
The study found that many workers, especially women, are “placing a premium on the flexibility and autonomy afforded by self-employment, and they are quitting paid employment in favor of entrepreneurship.”