Self Employed Women Ignored: New report shows policy makers continue to neglect needs.
Since 2016, the federal government has invested over $8 billion to level the opportunity playing field for women entrepreneurs. Analysts said equity in entrepreneurship would unlock over $150 billion in economic, job creating, innovation driven growth.
However, a new report titled The Invisible Entrepreneur, authored by an alliance of labour, feminist and women’s entrepreneurship organizations, shows Canadian women entrepreneurs need far more than start up skills, power networks and unbiased access to capital to fully liberate their economic potential; they also need social and economic policy support.
Today there are 198,000+ women-led majority owned businesses (18.4 per cent of the total, up from 15.6 per cent in 2015) operating small to medium sized enterprises (SME). However, over 81 per cent of all women entrepreneurs are self-employed, companies of one, representing the base of the women’s entrepreneurship pyramid.
The 2024 State of Women’s Entrepreneurship: Preliminary Findings Report released on March 18 also found:
- Over 37 per cent of self-employed women earn less than $50,000 per year ($25.99 hour), or about the same as a manager makes on salary at Tim Horton’s.
- Immigrant women, women with disabilities and 2SLGBTQIA+ women entrepreneurs are more likely to become self employed than other demographics.
- Women entrepreneurs are more than twice as likely to start out as self-employed in the early stage of their enterprise (35 per cent women versus 14.5 per cent men), mostly out of necessity, the definition of which includes escaping patriarchal, sexist workplace cultures, glass ceilings, glass cliffs and burnout from caregiving while also producing for traditional workspaces.
- Self-employment is one pathway to growing into an SME (Defined as a for profit incorporated entity with at 1–99 waged employees).
It is often said that Canadian SME’s are the backbone of the economy, however self-employed women are clearly at least an arm and a leg.
So why do policy makers ignore them?
Nancy Wilson, CEO of Canadian Women’s Chamber of Commerce (CanWCC) realized after attending government policy consultations over the years that the interests of self-employed women are overlooked.
“Public policy discussions consistently focus on entrepreneurs who have waged employees. There is no recognition that a self employed individual is an employer of one. Their economic contribution is undervalued,” Wilson said.
“We also found that other business organizations, like the traditional Chambers of Commerce or groups like the Canadian Federation for Independent Businesses may talk about gender equity, but do not use their leverage to advocate for the needs of women in business in general let alone the needs of self-employed women,” she added.
The February 2024 Pre-Budget Consultation Report which lists policy changes recommended by a variety of business associations and lobby groups this year does not contain a single reference to the needs of women entrepreneurs. But there are over 100 instances of the phrase “tax breaks” and topics related to removing regulatory red tape or reducing trade barriers.
While mainstream business organizations fail to advocate for gender and social equity where it counts, there are plenty of other organizations who do. This led Wilson to initiate the Economic Equity Alliance (the Allilance) comprised of over 10 organizations including the Canadian Labour Congress, Canadian Arts Coalition, Canadian Freelance Union (Unifor), Black Business and Professional Association, Innovators and Entrepreneurs Foundation, LiisBeth Media, Rise, Up with Women and the YWCA. Advisory support came from The Canadian Centre for Policy Alternatives and the Canadian Women’s Foundation.
The Alliance represents the first time that business, labour and feminist organizations have come together to address issues that matter to women entrepreneurs. Alliance Project Advisor and expert coalition builder Judy Rebick adds:
“Up until now, unions, entrepreneurs and organizations interested in the advancement of economic equity and business have historically seen each other as opponents. But that’s changed. There is recognition that we have a growing class of labour that doesn’t fit into the conventional box.”
Recommendations in the report include calling for the need to create a “Cross the Chasm” grant which could help create an estimated 250,000 new jobs by enabling growth-ready self-employed founders to make their first hire by covering and paying their full time salary directly for six months. This would help offset loss of income that occurs when a sole entrepreneur has to choose between spending time on sales or spending that time training a new employee.
A model for this concept already exists. The Create Action Fund offered by the Canadian Council Economic Development Network (CCEDNet) in concert with Social Research and Demonstration Corporation (SRDC) and the National Association of Friendship Centres (NAFC), plus Employment and Social Development Canada (ESDC) is a successful example. The Create Action fund provides a grant that covers six months salary plus additional wrap around supports for newly employed and first time employers looking to make the hiring leap.
Rebick adds: “I think the most interesting thing about our report is the fact that men and women self employed people start off in similar ways and experience similar business challenges, but soon as one takes the leap into incorporating a SME to access outside capital, the gender gap in SME ownership starts to widen significantly. The problem is not that women entrepreneurs are less ambitious, it’s the impact of systemic discrimination that is still embedded in institutions, when it’s the banks, giving money, or corporate clients who pay women owned enterprises less for the same services. We have to fix this.”
The full report can be found here. The work was funded by funded by a grant from the Department of Women & Gender Equality under the Feminist Response and Recovery Fund.
Originally published in rabble.ca
