SALT LAKE CITY — The number of female-owned businesses along the Wasatch Front and Utah has climbed significantly, according to one of the nation's largest banking institutions.
Wells Fargo reported this week that although women own a minority of businesses overall, their share of the pie is growing.
The most recent Annual Survey of Entrepreneurs indicated the number of women-owned businesses rose 2.8 percent in 2016 — twice the rate of men-owned businesses. The increase follows a decadelong trend that has seen the percentage of women-owned businesses rise from 16 percent of companies in 2007 up to 20 percent in 2016. In the Beehive State, the increase is equally impressive, said Shannon Williams, manager for consumer banking for Wells Fargo's Wasatch East district of Utah.
In the Salt Lake area, (the increase) is around 40 percent within the last year based on discussions with Wells Fargo bankers in the district, she said. More women are visiting branches to find financing for their businesses at a greater rate than last year, she added.
"The women are getting more confident and are excited about being trailblazers in whatever industry they are (in)," she said. The economic shift toward service industries has likely helped to underpin the gains, she said.
Women own a higher share of businesses in some of the fastest-growing industries over the past decade, like education, health care, fitness, retail and food services, she said. Employment among women has been disproportionately skewed toward these industries, and industry expertise is positively associated with ownership and survival rates, she added.
"It's very service-oriented businesses that women are gravitating toward," said Wells Fargo spokesman Tony Timmons. "As our economy overall shifts to a more service-based economy, that would compliment what women-owned businesses do."
While female-owned companies tend to generate less revenue and employment initially, their ventures into numerous fast-growing industries are helping them become increasingly important sources of employment, Williams said. Jobs at women-owned firms have grown 11 percent since 2012 compared to 3 percent among men-owned enterprises, she noted.
With the rise in the service sector and women’s job experience more closely mirroring that of men’s after decades of rising labor force participation, experts expect women to make further inroads into ownership in the coming years, she said. There remains a long way to go, however, to close the gap with men, she said.
Bringing in novel or improved processes and products to the market, entrepreneurs help foster productivity growth, which is critical in producing strong income gains, a news release stated. Supporting the growth of new small businesses is a key ingredient in a dynamic economy, Williams said.