Lost Count The U.S. Census Bureau gets stingier about classifying businesses as women-owned.
Opinions expressed by BIZ Experiences contributors are their own.
Does your business count? Perhaps not-at least, not under newdefinitions that the Census Bureau used when performing its mostrecent survey of women-owned businesses.
In its 1992 survey, the Census Bureau defined women-ownedbusinesses as those with female ownership of 50 percent or more,including public companies. But in its recently released "1997Survey of Women-Owned Business Enterprises," the Census Bureauchanged its definition to include only privately held companieswith 51 percent or more female ownership. The result? According tothe survey, the number of women-owned businesses dropped from 6.4million in 1992 to 5.4 million.
The change was made to be consistent with government procurementguidelines, under which businesses must have 51 percent femaleownership in order to be certified as women-owned. And, inreleasing the data, the Census Bureau was careful to note the newdefinitions and to point out that, after adjusting data from bothyears to allow for "approximate comparisons," the numberof women-owned businesses actually increased 16 percent between1992 and 1997.
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Still, the new count effectively ignores two large segments ofwomen-owned businesses: public companies (even those that aremajority women-owned) and companies owned equally byhusband-and-wife teams or other male-female partnerships. In fact,the Census Bureau noted that its survey counted 2 millionhusband-and-wife partnerships, which under the new definition couldnot be considered women-owned.
Julie Weeks, director of research at the National Foundation forWomen Business Owners (NFWBO), understands the reason for thechange, but the image the new numbers convey concerns her. (TheNFWBO, which uses government figures on the number of womenbusiness owners as a starting point for its own, most recently saidthere were 9.1 million women-owned businesses in 1999, and iswaiting to issue new numbers until it decides how to deal with thenew Census definitions.) "If you just look at the number offirms now counted and the employees and revenues counted,"Weeks says, "people would get a mistaken impression about theeconomic contribution of women-owned firms, thinking it to be a lotless than it truly is."
How will that mistaken impression affect women's access tocapital and assistance? Will bankers be less likely to lend to youif they think women-owned businesses are a declining breed? Will asmaller pool of women BIZ Experiencess be seen as deserving a smallerslice of the government pie?
The answers to these questions remain to be seen, but ActingChief Counsel for Advocacy Susan Walthall believes the newstatistics offer a valuable opportunity to open a dialogue aboutwomen-owned businesses. The SBA Office of Advocacy is one of manyorganizations working to ensure the new numbers are understood incontext. To that end, on May 1 the National Women's BusinessCouncil (NWBC) sponsored a task force meeting that includedrepresentatives from the Census Bureau, the Federal Reserve, theNFWBO and the SBA as well as members of various small-businessorganizations, academicians and BIZ Experiencess.
The goal, says NWBC deputy director Lynn Sheri King, was todevise widely accepted guidelines for what constitutes awoman-owned business in time for the 2002 economic census. Theissue is representation, stresses King: "Policy-makers look todata sources for information. If women who own 50 percent of abusiness aren't counted, they won't have the seat at thepolicy-making table that they rightly deserve."
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