WASHINGTON – Women-owned businesses generate more than $3 trillion in sales in the United States and are growing at two times the rate of any other U.S. business group, panelists said at a hearing of the U.S. Senate Committee on Small Business and Entrepreneurship.
Yet only 5 percent of women reach top management and, in some cases, only 3 percent of government contracting goes to women-owned businesses, panelists said.
The statistics and examples presented at this week’s field hearing at George Mason University highlighted the disparities women face compared to their male counterparts, and their difficulty in general in receiving federal contracts. In 1994, Congress passed an act that, among other things, set a federal contracting goal of 5 percent for women-owned small businesses. A decade later, in fiscal year 2005, only 3.3 percent of federal contracts were awarded to women-owned businesses.
“In 1988 the federal government began taking steps toward full recognition and effective elimination of economic discrimination against women-owned business,” panelist Erin Fuller, executive director of the National Association of Women Business Owners, said. “Unfortunately, awareness did not bring resolution or fairness to the procurement process.”
In Maine, women-owned businesses feel the pinch.
Jan Kaufman is one of those women. Along with Jill Fiore, she co-owns J Group Advertising, a company in Bangor that helps businesses develop marketing plans and branding identities. They launched their business in 2001 and have since struggled with obtaining federal contracts.
“That fact is,” Kaufman said of winning federal contracts, “it’s so hard that we don’t do it. It takes so much time to fill out the required paperwork, and often they want you to fill out more than is actually worth the work.”
“Women-owned businesses account for 47 percent of all Maine businesses, and are an increasingly important part of the Maine economy,” said Marita L. Fairfield, director and Internet business counselor of The Women’s Business Center, quoting research from the Center for Women’s Business Research. These businesses employ more than 75,000 people and generate $9 billion in sales.
Kaufman and Fiore started J Group Advertising out of their homes. They built the business until they had enough money to rent a small space. Just recently they moved into a larger loft office. “We grew as we could afford it and hired people as we could afford it,” Kaufman said.
They have never taken a loan and never received a federal contract.
They work with a third party that helps them obtain information about certain grants and other funding that would apply to them. But because of the tedious paperwork that comes with applying, they have not pursued any in more than two years.
“The best way to support women-owned businesses in Maine is to provide funding to organizations like The Women’s Business Center, who can then support small-business ownership in the state of Maine,” Fairfield said. “Funds are needed for non-profit business-developing organizations that target small businesses and women-owned businesses,” she said.
The Women’s Business Center at Coastal Enterprises Inc. is one such organization that helps women-owned businesses by providing workshops and seminars. It is a nonprofit that gets some of its funding from the U.S. Small Business Administration.
Panelists from the Small Business Administration and the General Services Administration both testified that improvements in federal contracting had been made and that loans to women-owned small businesses had significantly increased. They also said they were investigating ways to better streamline the process of applying for federal contracts.
Still, for women like Kaufman and Fiore, running a business remains a challenge.
Sen. Olympia J. Snowe, R-Maine, who chairs the Small Business Committee but did not attend the hearing, expressed her concerns for women-owned businesses. “My goal is to ensure that every woman who owns a small business in America, or any woman who dreams of owning one, has access to the resources and support they need to make that dream a reality,” she said in a subsequent statement.
“Women entrepreneurs are driving innovation in our country, women-owned businesses grow at twice the rate of all businesses, and with the right tools, their effort helps them keep America competitive,” Snowe said.