Research Summary

Women-Owned Firms Increase in 50 Metro Areas

Center for Women’s Business Research  ·  March 26, 1997

Growth is faster than the economy

The report, “1996 Facts on Women-Owned Businesses: Trends in the Top 50 Metropolitan Areas,” shows that between 1987 and 1996, the top metropolitan areas for women-owned businesses ranked on a combination of number of firms, sales, and employment in 1996 are: 1) New York, NY; 2) Los Angeles-Long Beach, CA; 3) Chicago, IL; 4) Philadelphia, PA-NJ; 5) Washington, DC-MD-VA-WV; 6) Houston, TX; 7) Seattle-Bellevue-Everett, WA; 8) Nassau-Suffolk, NY; 9) Detroit, MI; 10) Orange County, CA; and 10) Dallas, TX (tied).

The cities with the fastest growth in women-owned businesses as measured by the growth in the number, employment and sales among women-owned firms were: 1) Portland, OR-Vancouver, WA; 2) Seattle-Bellevue-Everett, WA; 3) Phoenix-Mesa, AZ; 4) Houston, TX; 5) Nashville, TN; 6) Miami, FL; 7) Sacramento, CA; 8) Dallas, TX; 9) Orlando, FL; and 10) San Diego, CA.

“This substantial growth in both sales and employment of women-owned businesses shows how significant they are to the economic health of their local communities,” noted Susan Peterson, NFWBO Chair and President of a Washington, DC-based communication training firm.

“This study is one more wake up call for all of us who are doing business with small business,” said Lucile Reid, executive vice president, Wells Fargo Bank. “It is clear that women business owners are a powerful and viable economic force that is rapidly transforming the face of small business in America. At Wells Fargo, we’ve responded to this amazing growth by creating a $10 billion, 10-year women’s loan program to fund continued expansion.”

“Nationally, there are nearly 8 million women-owned businesses as of 1996, employing more than 18.5 million people and generating close to $2.3 trillion in sales,” Peterson said. Overall, the growth rates of women-owned firms are the highest in the “non-traditional” goods-producing sector, which includes construction, manufacturing, and agribusiness.

“For the first time, we have complete, current information documenting the growth of women-owned businesses at the metropolitan area level,” said Reid, executive vice president, Wells Fargo Bank. “This study reconfirms that women business owners are a serious economic force.”

“As we increase in numbers and economic power, women-owned enterprises are beginning to resemble the profile of all U.S. businesses in size, age, creditworthiness, and industry distribution,” observed Peterson, NFWBO Chair. “But our research documents that these women business owners differ from their male counterparts in many ways, including how they manage, make decisions, select vendors, and use credit,” Peterson explained. “As women-owned firms continue to become more prominent in our economy, it is increasingly valuable for all businesses to understand, and benefit from these differences.”

“It is important to document the growth of women-owned businesses,” said Suzanne Taylor, national president, National Association of Women Business Owners (NAWBO) and president of Irvine, California-based STA Southern California, Inc., a critical care services firm. “These numbers enlighten policy makers and educate the public about women business owners. But most of all, they empower all women.”

One individual metropolitan area fact sheet complete with descriptive text, charts and a table that shows growth and industry breakdown of women-owned firms is available at no charge. The comprehensive 110-page “1996 Facts on Women-Owned Businesses: Trends in the Top 50 Metropolitan Areas” including the fact sheets for each of the 50 metro areas plus four detailed tables providing an overview of the rankings of the areas on key factors is available for $130.00. (Discounts are available for NAWBO members and NFWBO corporate partners.)

The National Foundation for Women Business Owners (NFWBO) is a nonprofit research and leadership development foundation affiliated with the National Association of Women Business Owners (NAWBO). NFWBO’s mission is to strengthen women business owners and their enterprises by conducting research, sharing information, and increasing knowledge.

The sponsor of “1996 Facts on Women-Owned Businesses: Trends in the Top 50 Metropolitan Areas” is Wells Fargo Bank, which is the number-one lender to small businesses in the U.S. Its Business Direct Division loaned more than $1.4 billion across the country through direct mail programs for businesses in the last year.

Methodology Note: The 1996 estimates are derived by analyzing 1987 and 1992 data published by the U.S. Bureau of the Census and projecting these trends forward to 1996. In cases where the metropolitan area boundaries changed between 1987 and 1992, adjustments were made to 1987 numbers to ensure that growth figures would reflect actual growth and not the addition of new geographic areas.

The following general assumptions were made: 1) the growth rates between 1987 and 1992 would continue at the same rate through 1996; 2) the increase in the number of firms, employment and sales found by the addition of C corporations in 1992 at the state level would be the same at the metropolitan area level; 3) in cases where data at the industry level were not available due to disclosure issues with the Bureau of the Census, state level industry distributions were used to provide an estimate.

The National Foundation for Women Business Owners (NFWBO) publishes a wide range of research studies, reporting on statistical trends among women-owned firms and documenting ways in which women business owners define success, finance their businesses, seek purchasing information and financial advice, meet the challenges of business ownership, provide benefits for their employees, use technology in the workplace, engage in volunteer activities, and take their firms global.

Trends in the Top 50 Metropolitan Areas

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