Britain is famously known as a nation of shopkeepers. And while the shops have changed (less greengrocers more green tech start-ups) a nation of shopkeepers is what we still are. Britain’s economy is driven by nearly six million small businesses – some 20% of them founded by women.
Self-employment in the UK is now at its highest level for 40 years, and responsible for much of that growth are the 1.5 million women going it alone. There are still twice as many male entrepreneurs as there are female – but more support to boost female entrepreneurship could result in a shot in the arm worth tens of billions of pounds to the national economy.
All very encouraging news for UK plc and the local economies in which these new arrivals are cropping up. Or it would be, if it weren’t for Brexit and the existential threat it represents to small businesses – and those set up by women in particular.
The way in which men and women operate as entrepreneurs is markedly different. Women entrepreneurs tend to be driven to open businesses by way of necessity, compared to men who are more likely to become entrepreneurs to make money. This single behavioural change has a big impact on how women-owned businesses operate.
Women traditionally raise less funding (only what they need) and are more cautious about growth. Too often they are underfunded. They also often work from home and around childcare and put families first, business second. They also tend to create more collaborative communities by hiring for talent rather than nationality.
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The net effect of this is that women-owned businesses tend to be more susceptible to market forces. They feel the effects of a downturn more and have little to no financial buffers to survive and pivot to new frontiers in those downturns. Their families suffer immediately because they are funded through those businesses.
Brexit and the threat it represents to small businesses – and those set up by women in particular – is a very real issue for us and has been for the last two years. We have moved way past “Project Fear” to “Project Survival”.
Just as these fledgling female-owned firms are finding their wings, they face the grave risk of the UK crashing out of the EU with the disastrous impact that could have on their business. The end of frictionless trade, the imposition of WTO tariffs and VAT for exports, border delays, disrupted supply chains, lack of available EU staff, increased red tape: these aren’t just arcane newspaper fodder. They’re concrete realities that threaten the very survival of firms already run on narrow margins, with limited cash flow and other resources. Brexit planning is a luxury most small business do not have – and the questionable prize of sovereignty will not keep the lights on.
If we ignore the peril that these businesses are in, we risk losing that huge, still untapped source of female potential. The government should be giving funding and support to entrepreneurs, not crushing them in pursuit of a political ideology. For example, over 70% of all the UK’s small businesses say they are desperate for more support in digital skills and creating an online presence.
It’s not just the national or local economy that suffer when women-owned small businesses fail. We, and the families we work to feed, would all be the worse for it. High time we held a People’s Vote to give those great new British businesses the security, support and future they deserve.
Edited by Luke Lythgoe
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