Closing the gender gap could add £250bn to UK economy
A government review, led by NatWest’s deputy chief executive Alison Rose, found that only one in three entrepreneurs are women. This means there are 1.1m less female entrepreneurs in the UK compared to their male counterparts.
The review concluded that closing this gender gap could add £250bn to the UK economy. It also identified five key barriers which contribute to lower rates of entrepreneurship amongst women. They were as follows:
1. Low access and awareness of capital
2. Greater risk awareness
3. Perceived missing skills and experience
4. Disproportionate primary care responsibilities
5. Lack of relatable sponsorship, mentorship and role models
As a result, only 6% of women in the UK run their own business, which compares to 15% in Canada and 11% in the US.
Access to funding was highlighted as the biggest barrier and this is supported by research from the British Business Bank, which showed that less than 1% of UK venture funding goes to all-female teams.
How to close the gap
In light of the findings, which were published on International Women’s Day, the report put forward eight initiatives to grow the number of female entrepreneurs by 50%. These include launching new investment funds to increase funding for female entrepreneurs, encouraging institutions and private investors to provide better support, as well as improving family care support.
The report also recommends the launch of a Female Entrepreneurs Code, which will see financial institutions commit to publishing data on gender funding. NatWest, Lloyds Banking Group, UK Finance and UK Business Angels Association have already confirmed to adopting the code.
NatWest’s Rose commented: “The UK has one of the most vibrant entrepreneurial communities in the world, but only one in three of our entrepreneurs is female – we need to be more ambitious and find ways to unlock the huge untapped potential.”
In addition, prime minister Theresa May said: “I want to build a country where all women can go as far as their talents and hard work can take them. It’s fantastic that we already have over a million women-led businesses, and the gender pay gap is at a record low, but the findings in this review show there is much further to go.”