It’s no secret that the United Kingdom has long been regarded as fertile ground for those looking to start a new business.
According to recent reports, London is widely considered one of the most desirable places in Europe to startup. Thanks to its appealing location, community spirit and concentration of capital, the iconic city continues to attract thousands of new businesses every year.
And what’s more, last year alone there were 1,059 businesses per 10,000 residents in the UK.
Ultimately, it seems that the country’s climate is rife with opportunities for plucky entrepreneurs hoping to make their business venture a reality.
And so this begs the question: how far does this business success extend to the UK’s women?
With this question in mind, UENI launched a UK-wide study in January 2020 to look into the gender split of small businesses and their leaders.
The goal was to get to know the users that utilize our platform on a daily basis, and map out the connection between gender and the business world across the UK.
The following research is based on a sample size of over 22,000 SMES.
Small Businesses: Who leads them?
From the 22,257 businesses surveyed, approximately 7205 were launched by female entrepreneurs.
This sets the number of UK businesses currently owned by women at 32.37%, highlighting a remarkable shift from four years ago, when just 17% of founders were female.
Our findings are reminiscent of the Rose Review’s finding in 2019 that ‘one in three UK entrepreneurs is female’.
Overall, this initial finding illustrates that the gender gap in the British business world is steadily closing, although this change continues to be slow.
Connecting gender & company size
Next, we looked at company size to determine how gender plays out in terms of the scale of UK businesses.
From a sample of 5106 business owners, we found that women are more likely to run a business as a one-person company than have four or more employees. Most tellingly, women-led companies make up only 23.44% of businesses with a larger employee count.
This finding can be linked to the differing levels of funding directed at male and female-led businesses in general. Indeed, the Rose Review (2019) found that female-led businesses receive less funding than those headed by men ‘at every stage of their journey’, making funding a potential factor that inhibits scale up.
Gender by business category
We were particularly intrigued to look into the gender split by industry when it comes to smaller businesses.
What areas of business are women most present in, and where are the clear gaps?
As can be seen below, women continue to make up the overwhelming majority of Hair & Beauty related companies, with women-led businesses making up 76.08% of the sector.
Other areas where women take the lead include the Gifts & Occasions (67.62%), Consumables (63.75%) and Wellness (62.83%) sectors.
Industries with a stronger balance of women and men in leadership positions include Clothing & Accessories and Grocery & Food.
Lastly, women are noticeably underrepresented in the running of companies based in Electronic & Appliance (2.82%), Construction Services (4.9%) and Outdoor & Garden (5.42%). These figures can be placed in context with recent estimates identifying women as 13% of the UK construction industry’s overall workforce.
These numbers might point to a combination of difficulty raising funds, the biases female entrepreneurs face and lower survival rates for women’s businesses affecting the types of companies women are opening.
Gender by location
The next stage of our study focuses on the significance of location when it comes to women owning businesses.
Our analysis demonstrates concretely that the percentage of women and men owned businesses can vary starkly depending on both city and county.
As such, the following section is split into UK cities and counties.
Small Business, Gender & City
According to our research of over 22,000 businesses, Derby is leading the charge as the city with the smallest gender gap for small business entrepreneurs.
On average, Derby’s business owners are 40.57% female, making it the city with the highest proportion of women-owned SMEs across the UK.
Crucially, Derby also exceeded the national average that places women as making up only around 30% of all entrepreneurs.
It’s closely followed by Doncaster, where 40.54% of businesses surveyed are owned and run by women, as well as Hull (39.32%) and Sheffield (37.21%).
Most notably, many of the cities making this list are located in the north of England. These figures call to mind Clydesdale Bank Yorkshire Bank’s assertion that Sheffield is one of the two best UK cities for female entrepreneurs.
Interestingly, despite evidence showing that roughly a third of all UK businesses are located in London or South East, our analysis placed London as only the 9th best city in the country in terms of its proportion of women-owned businesses.
Looking further afield, Glasgow also tops the list for best cities for business-women in Scotland, with a 32.82% average. Other standouts include the Welsh city of Swansea, and Belfast in Northern Ireland.
Small Business, Gender & County
Based on this analysis, we can also report that the West Midlands county of Staffordshire has the overall highest proportion of women-owned small businesses across the UK (41.72%). It’s notable that this figure well surpasses the national average for female entrepreneurs.
Next up is Shropshire county (40.52%), also located in the West Midlands, followed by Southern England counties like Wiltshire (39.01%) and Cornwall (37.91%) and more. The Scottish county of Fife also made the top-twenty list with an average of 36.84% of its small businesses being owned by women.
Other best-performing counties for business-women include Leicestershire and South Yorkshire, signalling a continuation of 2018’s trend with the Midlands and the north boasting some of “the most attractive cities for female entrepreneurs” in the country.
Despite London’s continued status as an attractive location to launch new businesses, the county of Greater London holds a lower-ranking position for female entrepreneurs nation-wide, with only 33.31% of its businesses being owned by women.
Small Business, Gender & Country
Finally, an analysis of 22274 small businesses revealed that Scotland is the UK nation with the highest level of women-owned businesses, very closely followed by England and Wales.
These figures seem to reflect Scotland’s continuing strides for gender diversity in the workplace, yet it must be noted that the overall winning margin was extremely slim.
Overall, Northern Ireland ranks as the country with the lowest overall level of female entrepreneurship. According to our figures, just 27.49% of small businesses in the country are run by women, lower than the current national average.
A year on from reports that just three of Northern Ireland’s top firms are led by women, it is clear that no great strides for female entrepreneurs have been made.