Study shows women are more likely to give up on their businesses than men

A recent report by the Global Entrepreneurship Monitor report by the Stellenbosch Business School has revealed that women are more at risk to relinquish their businesses, compared to their male counterparts.

They’ve attributed the trend to the  COVID-19 pandemic, personal or family life, and the business’ lack of profitability, amongst others.

Lead author of the report, Natanya Meyer says more women leave the entrepreneurial space due to failure to recover from the pandemic.

She says 21.5 % of women in the business sector attribute their reasons for giving up their business to personal and family life, compared to 12.1 % of men in the sector.

This has raised concern over household responsibilities mostly falling on women, especially those from traditional family settings.

Mayer says out of the four main groupings within the economic sectors; namely the extractive, transforming, business services, and consumer-orientated services sectors, most women gravitate towards occupying the consumer-orientated services space.

“Consumer-orientated services, which include, amongst others, hotels, restaurants, and retailing services, is the sector where most women have their businesses, with 76.7 % of women starting to establish their business and 81. 9%  of business start-ups by women.” Says Mayer

Low market increase, affordability, and specialisation of businesses are some of the reasons why women gravitate towards the Consumer Orientated Services sector.

Mayer says to lessen the gap between Male and Female entrepreneurs, a greater understanding of women’s entrepreneurship and the phenomenon around it, needs to be developed.

“Sometimes it’s easy to say that women are like men, or women differ this much to men, or in these ways, but to understand how they differ in the entrepreneurial space can help refine policies and programs to assist them to be more successful,” says Mayer

She adds that the promotion of women’s entrepreneurial networks is much needed as it will encourage them to do things without being discriminated against, especially for women who need to develop the skill set and self-efficacy.

The study shows that girl children need to be introduced to entrepreneurship from a basic education level.

“This needs to start at the school level where entrepreneurship days need to be held more often, and girls need to be involved more often so they can understand the benefits of doing business,” says Mayer.

Written by Odirile Rabolao