Oregon among top women-owned business states

By Oregon Employment Department

Oregon ranks 12th in the nation in percent of women-owned businesses according to data released by the U.S. Census Bureau (Table 1). In 2007, nearly 30 percent of Oregon’s businesses were owned by women. That matches Oregon’s share of businesses owned by women in 2002. Of Oregon’s roughly 103,600 women-owned businesses in 2007, 86 percent of them had no employees. That’s close to the U.S. average of 88 percent. The approximately 14,200 women-owned businesses in Oregon with employees provided 96,900 jobs and paid $2.6 billion in wages.

With 86 percent of women-owned businesses in Oregon having no employees, this is a group with many microenterprises. A microenterprise is generally a small business with five or fewer employees and small capitalization needs. Organizations like Lane MicroBusiness in Eugene help low-income microentrepreneurs get their businesses off the ground and support them as they grow. Shawn Winkler-Rios, executive director of Lane MicroBusiness, said that most of his clients are women. “Historically, about 60 to 65 percent of the businesses we serve are owned by women,” says Winkler-Rios. In line with statewide averages for women-owned businesses, he says they serve many women operating in the service sector. “We see artists and lots of service businesses of all kinds – travel agent, real estate, web design, etc.”

The reasons why women start businesses varies, but Winkler-Rios sees some common threads. “These are people who like what they do and use the skills that they have. If they have children, it provides a more flexible schedule and hours. Some women want to make a contribution to their households. Others get tired of low-wage work – it’s not satisfying and not paying the bills.” Winkler-Rios says he also sees changes in technology and industry restructuring driving more women to self-employment.

Winkler-Rios has worked with businesses in areas with high concentrations of women-owned firms, like Lane County and the cities of Oakridge, Cottage Grove, Springfield, and Eugene. He’s also worked in areas with low rates of women-owned firms like Coos and Curry counties and the cities of Roseburg, Bandon, and North Bend. Based on his observations, there are some factors that lead to high and low rates of women-owned business. “It’s the lifestyle,” says Winkler-Rios. “People want to live in these towns [with high rates of women-owned businesses]. And to stay in them they’re looking to self-employment.”

Some communities have business clusters that promote women-owned businesses. “Oakridge has a large group of artists. Cottage Grove has a large service sector,” says Winkler-Rios. What about communities with low rates of women ownership? “Those communities have more employment opportunities,” states Winkler-Rios. “The manufacturing bases were there where households could maintain a comfortable lifestyle. There seems to be a connection between job opportunities and wages and self-employment.”

As for trends in women-owned businesses, Winkler-Rios has noticed some things. “I do see some clusters emerging,” says Winkler-Rios. “Organic-based clothing and food products, and not just in Eugene. We see more and more people experimenting with organic health products. People are looking for new ways to be environmentally and health conscious,” observes Winkler-Rios. Geographically speaking, Winkler-Rios says he’s noticed another trend. “There’s a growing trend in rural communities towards self-employment – in Western and Eastern Oregon. I’m not sure why, but it’s growing.”

Women-Owned Businesses Concentrated in Service Sector

Most women-owned businesses in Oregon are in service sector industries or retail trade. Graph 1 shows industries with the most women-owned businesses in Oregon. With one exception, the distribution closely mirrored that of the nation. The professional, scientific, and technical services industry has the second-highest industries with concentration of women-owned businesses in Oregon, whereas nationally it represents the fourth largest industry. The largest industry sectors within professional, scientific, and technical services include legal services, management and technical consulting services, and accounting and bookkeeping services.

The industries in Oregon with the highest percentage (as opposed to number) of women-owned businesses differ slightly from those in Graph 1. At 52 percent, the industry with the highest concentration of women-owned businesses is health care and social assistance. It’s the only industry in Oregon with a majority of women owners. The industry with the second highest concentration of women-owned businesses is educational services at 45 percent. While this industry is smaller in terms of total businesses, it is an industry with a high concentration of women owners. The “other services” sector has the third-highest rate of female ownership (43%). Administrative support and waste management services (40%) and retail trade (35%) round out the top five.

Women-owned firms tend to be small. They represented 30 percent of all businesses in Oregon in 2007, but employed only 7 percent of workers, or 11 percent if counting the nonemployer business owners as workers. In the U.S., women-owned firms employed 6 percent of workers (or 10% if counting nonemployers).

Being small, women-owned firms trail other firms in sales in Oregon. Sales per woman-owned business in 2007 were $135,312 compared to $937,244 for all firms. The industry that provided the highest sales per woman-owned firm in Oregon, by far, was wholesale trade with $1,602,969 per firm. The next closest industry was manufacturing at $690,880 per firm. Of the industries with the most female-owned firms (listed in Graph 1), retail trade provided the highest sales per firm at $177,280.

Metro Area Women-Owned Businesses

Data for women-owned businesses in Oregon is also available at the county and metro levels. Of the state’s six metro areas, Portland and Eugene had the highest percentage of women-owned businesses (31% each). These two areas were also the only metros with more than the statewide average of 30 percent. The Bend metro area (Deschutes County) reported the lowest female-ownership rate (Figure 1).

So what’s going on in the Portland and Eugene areas to them a slight edge in their rate of women-owned businesses? Unfortunately, some of the industry-by-gender census data were suppressed because the firm count was less than three or the relative standard error of the sales data was 50 percent or more. This mostly occurred in smaller industries in Eugene, a somewhat small metro area. Still, a great deal of information is available for these metro areas, and the numbers reveal some interesting points.

The two industries with the largest number of women-owned firms were the same in both the Eugene and Portland metro areas: professional, scientific, and technical services, followed by health care and social assistance. The percentage of these industries that women-owned firms comprised in the metro areas generally mirrors the statewide average (Graph 2). What’s more remarkable, however, are the other industries in Eugene and Portland with high concentrations of female-owned businesses. The health care and social assistance industry boasts the highest share of women-owned businesses in both metros, as is the case statewide. But in Eugene the administrative support and waste management services industry has the second-highest rate of women-owned businesses (47%), which exceeds the statewide rate by 7 percentage points. In Portland, educational services matches the rate of female ownership for health care and social assistance (51% each), and the 46 percent rate in other services sits 3 percentage points above the statewide level.

Based on information from the Census Bureau, the number of women-owned businesses as a percent of all firms in Oregon is growing. Women-owned businesses in Oregon are slightly more prevalent in the Portland and Eugene metro areas. They also tend to have no employees and bring in lower sales than the average for all firms. Statewide, health care and social assistance is the only industry in which the majority of business owners are women, but female ownership is prevalent in many other industries, especially services.