By Caroline Castrillon
The number of women-owned businesses increased nearly 3,000% since 1972 according to the “2018 State of Women-Owned Businesses Report” commissioned by American Express. Not only that but between 2017 and 2018 women started an average of 1,821 new businesses per day in the U.S. With women now making up a whopping 40% of new entrepreneurs, it’s clear that more women are turning to entrepreneurship than ever before. But why are so many women starting businesses? Here are a few reasons women are favoring entrepreneurship over climbing the corporate ladder:
To have more flexibility
The reality is that women are still the primary caregivers whether we’re talking about children or aging parents. One research study indicated that the primary reason American women start businesses is to accommodate work to their family needs. Another survey revealed that roughly 74% of women said flexibility is more important than making the most money. Being your own boss generally allows for more freedom than working for someone else. This additional autonomy is especially helpful when family may be the number one priority. The ability to set your own schedule also makes it easier to make time for exercise and a healthy lifestyle—another reason why women are turning to entrepreneurship.
To charge what they are worth
Unfortunately, the gender pay gap has remained relatively stable over the last 15 years or so. The Census Bureau found that full-time, year-round working women earned 80% of what their male counterparts made in 2016. If change continues at the rate seen since 2001, women will not reach pay equity with men until 2119. Do we want to wait another hundred years? Certainly not, which is why women are favoring entrepreneurship. If you’re the boss, you are in the unique position to set your own rates and charge what you’re worth.
To have more control over their future
The belief that working for a company offers the most stability is a myth. Many women have experienced a layoff, restructuring, reorganization, buyout or a variation of those at some point in their corporate life. These scenarios often result in organizational changes which are out of one’s control and can have a negative career impact. Working for yourself means you are in the driver’s seat. This is a powerful statement because you not only have control over your business activities but also whom you work with including clients and business partners.
To advance more quickly
More women are starting businesses to escape the glass ceiling. A fascinating study published in the Harvard Business Review tested the theory that women aren’t promoted as quickly as men because they behave differently. The study, using sensors, found that men and women behave the same in the workplace, get the same amount done in a day, spent the same amount of time at face-to-face meetings with their superiors and scored equally in performance evaluations. These results suggest that the differences in their promotion rates weren’t due to their behavior but to how they were treated. Research by LeanIn.Org and McKinsey & Co. showed that although women and men say they want to be promoted in about equal numbers, women are 15% less likely than men to get promoted. The researchers say that, at this rate, it will take more than a century to achieve gender parity in the C-suite. Not surprisingly, women are turning to entrepreneurship to advance their careers more quickly.
To follow their passion
Many women are leaving corporate life because their jobs just aren’t inspiring them anymore (if they ever were). Starting a business allows you to find meaning and gives you the ability to leave behind a legacy that you can be proud of. To be truly successful, you need to find work that you’re passionate about. In a wonderful book called, Heart, Smarts, Guts and Luck the authors in their research found that without heart, few businesses become truly successful. In fact, they say that “pure brain-based IQ is probably the least essential quality for business success.”
If your corporate job seems stifling and unfulfilling, perhaps it’s finally time to consider being your own boss. After all, it feels better to fail at something you love than succeed at something that you don’t care about.