Roundtable participants also underscored the need for systemic change rather than focusing on overtraining or in some way fixing women entrepreneurs. These findings align with much of the research and recent available data on this topic. For instance, while women entrepreneurs generally present a lower risk⁶ and deliver higher returns⁷, they often face more discouragement from applying for loans⁸. In fact, recent data indicate that women typically receive lower loan amounts than men for a variety of reasons but are “charged slightly higher interest rates.”⁹ Noting this important feedback, any future or prospective SBA lending program should not include any future training prerequisites to financing or loan eligibility.

During NWBC’s May 2022 public meeting, several national women’s business organizations shared information about their programmatic and policy priorities. For example, Karen Bennetts, Chair-Elect for the National Association of Women Business Owners (NAWBO) shared that “addressing the needs of ‘microbusinesses’” is critical and discussed the need to define and codify the term “microbusiness” for use by all federal agencies. She explained that differentiating “microbusiness” from “small business” is critical to helping more women entrepreneurs access capital and procurement opportunities. During subsequent NWBC “Access to Capital and Opportunity” subcommittee meetings, Council Members agreed this was an important distinction to raise before the full Council.

Subcommittee discussions also centered on other key factors that have impacted women business owners’ ability to successfully access pandemic relief funding, as well as financing for growth in the years leading up to and following the onset of COVID-19. Both Council Members Selena Rodgers Dickerson and Pamela Prince-Eason discussed the negative ramifications of unfair practices on women’s entrepreneurship in the processing of payments as well as predatory lending practices. Council Member Jaime Gloshay also doubled down on the problem of predatory lending and noted the importance of challenging some underwriting requirements, as well as considering “relationship lending” program models. She also noted that it is important to address both gender and racial discrimination and shared that in Native communities, predatory lending is a big problem and most Native Women business owners tend to self-fund.¹²

Notably, a recent study co-authored by a Cleveland Fed researcher found that “compared to small businesses owned by men, those owned by women faced more operational and financial challenges and were less likely to receive financing.”¹³ And, “those owned by Black women, faced more financial and operational challenges during the pandemic and were less likely to receive financing.”¹⁴ Women’s lack of access to pandemic relief certainly came to the national forefront during the first tranche of the Paycheck Protection Program (PPP).¹⁵ By some accounts, “the discrepancy of average loan amounts between male and female owners [was] even higher than the data suggests for the first time period PPP loans were given.” Moreover, longstanding inequities such as the high cost of capital for many women and minorities has significantly impaired their ability to grow and scale, and thus served as yet another barrier to buildinggenerational wealth via a successful business and strategic exit.¹⁷

However, Council Members also remained focused on how to better support women entrepreneurs who successfully accessed relief or other forms of financing prior to, or during the pandemic, and may still be struggling. Remarkably, according to 2021 Goldman Sachs data, about 40 percent of small business owners expressed worry that “the debt they … accumulated during the Covid-19 pandemic … [would] hinder their ability to recover. Even more Black owners (55 percent) [expressed] this concern.¹⁸ This data also indicates that just last year, “[n]early 60 percent of Black women small business owners and almost half of women owners overall continue[d] to struggle financially due to the pandemic.”¹⁹

Initial steps to help alleviate these financial worries could include defining “microbusinesses” to distinguish these enterprises from small businesses, gleaning learnings from the PPP debt relief model to better inform and potentially expand debt relief options across other SBA lending programs, and continuing to prioritize the needs of women business owners, including those operating in industries with unique workforce retention and scale-up challenges, such as in the care economy.

Congress should develop and provide a uniform definition for a microbusiness. Additionally, Congress and SBA should consider further expansion of debt relief options for certain 7(a), 504, and microloan borrowers, and continue prioritizing the needs of economically disadvantaged micro-and small business borrowers in industries with significant participation by women, particularly those severely impacted by pandemic-related global supply chain issues or other major global economic disruptions.

Since the 1950s, “Congress has used its broad authority to impose requirements on the federal procurement process to help small businesses receive a fair proportion of federal contracts and subcontracts, primarily through the establishment of federal procurement goals and various contracting preferences.”²⁸These preferences include restricted competitions known as set asides and sole source awards.²⁹

The SBA’s WOSB Federal Contracting Program is just one of those programs. The federal government’s goal is to award at least five percent of all federal contracting dollars to women-owned small businesses each year.³⁰ This is to be accomplished via set asides and sole source awards, but this goal has only been met twice since it was first authorized in 1994 and implemented in 2011. However, as explained in a July 2022 Congressional Research Service report titled SBA Women-Owned Small Business Federal Contracting Program, “[m]ost of the federal contracts awarded to WOSBs are awarded in full and open competition with other firms or with another small business preference, such as an 8(a) or HUBZone program preference. Relatively few federal contracts are awarded through the WOSB program.” ³¹

Council Members serving on this “Access to Capital and Opportunity” policy subcommittee agree and have repeatedly expressed concern that in addition to federal agencies not having sufficient experience utilizing the WOSB program, the program: 

Recognizing that the federal government is the largest buyer of goods and services in the country³⁵, and the potential for growth it offers for women-owned small business owners, Council Members have identified four key policy proposals to help achieve parity of the WOSB/EDWOSB federal contracting program and ensure more women business owners get their fair share of federal contract awards.

Although women entrepreneurs, particularly women of color, have expressed some concern and even frustration over receiving redundant training in lieu of access to capital opportunities³⁶, Council Members agree that providing financial education tailored to suit women small business owners’ needs at every stage of the business cycle remains critical to ensuring business sustainability and success. Council Member subcommittee discussions on this topic centered around expanding existing resources or creating new customized programs which emphasize knowledge and skill-building for managing cashflow, engaging in financial document organization and emergency preparedness, building a “good” credit score, creating a capital stack, reinvesting in the business, and planning for business succession or a successful exit.

Council Member Roberta McCullough, for example, has noted the importance of helping women entrepreneurs better understand the impact that the U.S. credit scoring system can have on their business, while simultaneously urging for a careful assessment of proposals that look to reform or altogether overhaul the U.S. credit reporting system— a system which some argue is flawed, lacks transparency, and is likely the source of various and very troubling racial disparities.³⁷ Additionally, Council Member Jaime Gloshay has expressed agreement on this point, and has also noted that because many women of color, such as Native women, may be self-funded and without access to relationship banking or investor networks, enhanced education together with well-sourced wraparound community-based supports could prove impactful.

On background, SBA’s Ascent program currently includes a “fifth journey”— access to capital — to better prepare women business owners as they consider financing their dream. The journey covers five separate “excursions,” including: debt funding, equity resources, capital sources, banking relationships, funding pitches, and angel investing.³⁹ Additionally, as highlighted in past NWBC annual reports, SBA remains an active participant of the twelve-member Financial Literacy and Education Commission (FLEC).⁴⁰ SBA has also partnered in recent years with the Federal Deposit Insurance Corporation (FDIC) to develop and later update the Money Smart for Small Business⁴¹ program and curriculum available in English and Spanish. Council Members are encouraged by SBA’s ongoing efforts, which may be taken one step further by leveraging dedicated financial education grants for certain small business resources partners engaged in this work.

Small business owners, including women business owners, continue to deal with ongoing supply chain disruptions and labor shortages, stemming in part from a post-COVID economic recovery, global inflation, and geopolitical conflicts abroad.⁴² While women business owners remain resilient and optimistic, the Council contends that additional relief is needed moving forward.

On background, the Employee Retention Credit (ERC) provided for in the Coronavirus Aid, Relief, and Economic Security (CARES) Act is a payroll tax refund available to certain employer-based firms that experienced a significant decline in gross receipts in 2020 or during the first three quarters of 2021 or experienced a “full or partial suspension of operations due to a government order if … the business’ suppliers [were] unable to make deliveries of critical goods or materials due to a governmental order that cause[d] the supplier to suspend its operations.”⁴³ However, supply chain disruptions persist. Small business owners, particularly WOSBs, require and could benefit from an expansion of this type of tax relief for additional losses sustained beyond 2021.

Beyond tax relief measures, however, it is also worth mentioning that in 2021, the Biden-Harris Administration established a “Supply Chain Disruptions Task Force” to address short-term supply chain discontinuities.The White House also released an assessment of four products identified as critical at the time including: “semiconductor manufacturing and advanced packaging; large capacity batteries; … critical minerals and materials; and pharmaceuticals and active pharmaceutical ingredients (APIs)”⁴⁴ to support investments in the President’s American Jobs Plan.

Additionally, the “Inflation Reduction Act [IRA], which includes expanded or extended tax credits and additional funding for the IRS, was signed into law on August 16, 2022.”⁴⁵ According to the White House, “the Inflation Reduction Act will reduce costs for small businesses by maintaining lower health care costs, supporting energy-saving investments, and bolstering supply chain resiliency.”⁴⁶ For instance, the legislation signed into law in August 2022 helps cut energy costs for small businesses. Small businesses that switch over to low-cost solar power may be eligible for a tax credit; small business building owners may also “receive a tax credit up to $5 per square foot to support energy efficiency improvements,” and those that “use large vehicles like trucks and vans will benefit from tax credits covering 30 percent of purchase costs for clean commercial vehicles.”⁴⁷

Moreover, this legislation is positioning more small businesses to grow and create new jobs by “doubling the research and development (R&D) tax credit for small businesses” from $250,000 to $500,000. And, among other provisions, IRA “includes targeted tax incentives aimed at manufacturing U.S.-sourced materials like batteries, solar, and wind parts, and technologies like carbon capture systems and electrolyzers to make hydrogen.”48 Moreover, it is described as a critical step toward making the U.S. tax code fairer by ensuring that the larger corporations “pay taxes they already owe … and cracking down on … corporations with more than $1 billion in annual profits,” as well as “imposing a 1 percent surcharge on corporate stock buybacks.”49

While all these and similar efforts and accomplishments are laudable, this Council also urges the White House and Congress to identify new opportunities to expand tax relief for small business owners as well as consider easing eligibility requirements,⁵⁰ particularly for care economy businesses and those in industries with a significant women and minority business owner presence, and that experience a significant interruption in their operations and loss of revenue due to ongoing supply chain disruptions and/or labor shortages. Given the possible challenges that may still lie ahead, expanding tax relief such as the ERC and simplifying qualifying criteria as well as records submission requirements would potentially provide much needed relief for these struggling businesses.

Women’s lack of inclusion in today’s innovation ecosystem and STEM entrepreneurship remains concerning to Council Members. While the gender gap within STEM disciplines continues to slowly narrow, gender parity in innovation will not happen within our lifetimes by most estimates.⁵¹, ⁵² Nonetheless, women represent an important source of untapped potential for spurring American innovation and entrepreneurship. Women are becoming more involved in academic settings than ever. About half of U.S. doctorates are earned by women. Additionally, academic institutions are now the largest employer of women with doctorates in science, engineering, and health (SEH).⁵³, ⁵⁴ However, while the presence of women in academia grows and universities expend billions of dollars in research, secure thousands of patents, and incubate and accelerate hundreds of startups each year,⁵⁵ only a small percentage of women end up participating as a sole female founder or co-founder.⁵⁶

The current landscape reflects a lack of intentional inclusion of women in innovation and business opportunities and a lack of supports for professionals with caretaking responsibilities, further weakened by COVID-19. Specifically, with respect to women’s journeys in STEM careers, the gap in leadership and innovation curiously begins to widen as women progress in their profession. This is often referred to as a “leaky pipeline” for those in highly specialized fields, including business and management consulting.⁵⁷ A 2022 Stanford Social Review article suggests that women divert from STEM not because of their individual life choices, but rather, “because opportunities begin to diminish [due to] systemic barriers and layers of biases.” ⁵⁸ Worst of all, the lack of inclusion of women in innovation negatively impacts the effectiveness, or even the availability, of a much-needed product. The article goes on to say, “the impact of these barriers and biases extends beyond workplaces; they shape STEM products and innovations themselves. Multiple studies have shown that gender and racial bias in product design can have significant, even deadly, effects.”⁵⁹

Council Member Roberta McCullough was highly receptive to the presentation, particularly the point on considering utilizing weighted criteria to ensure the creation and implementation of a DEI plan as a requirement for research institutions on all federal grant applications. In her words, “that which gets measured gets done.” Additionally, there was consensus among Council Members that failing to ensure greater inclusion of minorities and women should have consequences, impacting institutions’ federal research funding bottom line. Council Member McCullough also emphasized the value of mentorship and suggested that certain local resources, such as WBCs, are well-positioned to support or partner with universities in their outreach efforts to innovators. Related to this topic, Council Member Selena Rodgers Dickerson shared key insights on how to better support recent graduates and new professionals so that they are armed with a strong understanding of basic principles and the fundamental technical skills needed to fully participate in innovation as well as collaborate on existing projects. She also underscored the importance of coupling practical technical application with business education.

In short, Council Members aligned on the importance of expanding efforts that encourage and invest in the development and active participation of more women in academia to not only embark on STEM careers, but also to consider entrepreneurial paths to bring needed products to market, create jobs, and build wealth. Targeted outreach to women in academic settings, relevant mentorship opportunities, and adoption and robust implementation of DEI plans will be key to achieving impactful results. Given that academia receives significant amounts of federal funding, the government is uniquely positioned to incentivize universities to catalyze progress by ensuring women’s engagement and inclusion in academic innovation.

In the interim, policymakers and certain federal government agencies continue to reassess their programs and resources on an ongoing basis, aiming to reach more minorities and women innovators across different fields and levels of education. Whether through the opening of a new WBC at a university, tailoring federal resources and initiatives, or advancing legislation that directly supports women in STEM, Council Members nevertheless agree that a multifaceted, interagency approach will likely bring about the most impactful results. Notably, at the time of the writing of this report, the U.S. Patent and Trademark Office (USPTO) Director Kathy Vidal announced the launch of its Women’s Entrepreneurship (WE) initiative:

“a community-focused, collaborative, and creative initiative to inspire women and tap their potential to meaningfully increase equity, job creation, and economic prosperity” during National Entrepreneurship Month in November 2022.60 The goal is to leverage the expertise of stakeholders, including women entrepreneurs, funders, and strategists to help champion women innovators and business owners. As part of this initiative, USPTO has also already announced its 2023 Women’s Entrepreneurship Symposium, a three-part event series covering innovation and business topics and featuring public and private sector experts.⁶¹

Also, earlier in the year, SBA Administrator Isabella Casillas Guzman announced over $5.4 million in funding to 44 awardees through the Federal and State Technology (FAST) Partnership Program. SBA’s FAST program “provides small businesses and startups, particularly those in underserved communities, with specialized training, mentoring, and technical assistance for research and development. Grant selectees qualify for award amounts of up to $125,000 each.” The Council is encouraged by Administrator Guzman’s steadfast commitment to prioritizing minorities and women in SBA’s programs like FAST.

Noting the Administration’s focus on rebuilding our nation’s infrastructure, NWBC considered factors to help increase women’s inclusion, employment, and contract procurement opportunities in high growth industries such as architecture, engineering, and construction (AEC) and other STEM high-yield fields. Council Member Selena Rodgers Dickerson, who owns and leads an engineering design and project management firm, shared during policy subcommittee discussions that language to promote women’s inclusion in STEM careers and contracting opportunities often excludes the AEC field. The latest statistics indicate that women in the U.S. continue to be underrepresented in the AEC industry. For instance, about “27 percent of professionals who specialize in the Architecture and Engineering are women. Women in Construction represent only about 11 percent”⁶² according to the U.S. Bureau of Labor Statistics.⁶³

Once again, Council Members participating in the Women in STEM policy subcommittee believe that targeted outreach to women as well as industry-relevant business management mentoring opportunities are lacking for those involved in high-yield and high-growth specialized fields. And, while women in these fields with lower representation experience less significant gender pay disparities,^{64, 65, 66} the industry’s male-dominated culture and networking opportunities often keep highly qualified women business owners out of state and federal procurement opportunities, particularly those operating in the AEC industry. Notably, with the implementation of the BIL as well as the IRA, the AEC industry and other STEM-adjacent fields are now becoming high-growth industries. Concurrently, government agencies like SBA, Commerce, and DOT are coordinating efforts to encourage greater participation in opportunities presented by the BIL. As U.S. Transportation Secretary Pete Buttigieg said, “these new initiatives with our partners at SBA and MBDA will help more small business owners secure federal contracts to modernize our country’s infrastructure for decades to come.”⁶⁷ Keeping in mind these growing opportunities as well as the Biden-Harris Administration’s focus on ensuring greater inclusion of minorities and women in federal contracting opportunities, NWBC will remain laser-focused on awards to women-owned businesses in these fields.

Leveraging the Biden-Harris administration’s prioritization of women and minorities in the implementation of the BIL, support for legislation focused on increasing the number of diverse women innovators in accelerators, and increasing federal procurement opportunities will enable trailblazers to cut a path of success for future entrepreneurs. Additionally, new research into women’s participation in high-yield and high-growth fields will be important. It will help to further inform evidence-based outreach, mentoring, and training practices. Updated research will shed light on factors that explain significant discrepancies between women’s low participation in these more resilient industries, in comparison to their participation in other industries that tend to be more economically and socially vulnerable.

For instance, according to a 2022 survey, most women small business owners worked in: 

Updated research will shed light on factors that explain significant discrepancies between women’s low participation in these more resilient industries, in comparison to their participation in other industries that tend to be more economically and socially vulnerable.

By contrast, the healthcare and technology industries are expected to grow quickly due to longer life expectancies and technological advancements. However, manufacturing and retail are expected to decline due to automation and e-commerce, respectively.⁷¹ When it comes to yield, the industries with the greatest predicted revenues mirror these results.⁷² Thus, looking beyond the pandemic, it will be important to address how to best attract, actively recruit, prepare, and invest in the inclusion of more women in resilient, higher growth, and higher yield industries.

Women In STEM subcommittee members also discussed effective strategies to rebuild the women’s STEM entrepreneurship pipeline. Fair access to primary, postsecondary, and undergraduate education, as well as post-graduate training, accessible industry-specific mentorship opportunities, and more dynamic resource partner collaborations in STEM remained at the forefront of this year’s subcommittee discussions. For instance, Council Member Selena Rodgers Dickerson said that STEM education should be clearly defined and ensure that it is “all-STEM inclusive,” underscoring that women should have the opportunity to explore the full landscape of STEM opportunities beyond tech. They should be aware of opportunities in the AEC and environmental sciences and sustainability fields.⁷³ Notably, recent data indicates slow progress for women achieving gender equality in environmental decision-making globally.⁷⁴ Council Member Roberta McCullough echoed these sentiments, emphasizing the value of mentorship and practical skill development as a former educator.

As previously noted, historically, women’s progress in STEM careers often stagnates for a myriad of issues. However, the “leaky pipeline”⁷⁵ in STEM is most proximately tied to systemic issues such as institutionalized gender-based bias, starting as early as the K-12 level before moving to the university setting and beyond—in labs, technology transfer offices, and in the workforceThese trends seem to worsen over time. As one recent study found, “when asked to draw a scientist, 70 percent of 6-year-old girls draw a woman, while only 25 percent of 16-year-old girls do.” ^{76, 77} This bias creates a compounding effect by the time women reach college. Moreover, consider the following:

When women get to the professional arena, the ability to get a foot in the door or re-enter after leaving the STEM workforce also proves difficult, as attested to by Council Member Rodgers Dickerson during one subcommittee meeting. She shared her own experience and that of her peers as they struggled to seek out and find meaningful professional mentorship opportunities. Given these experiences, she suggested during discussions that entrepreneurial ecosystem builders, together with small businesses, could play a more active role in supporting new entrepreneurs with true potential for growth. Council Member McCullough concurred, and both also discussed the need to bolster online resources with targeted, robust content tailored for distinct industries. Increased resources to ensure more targeted, industry-specific interactive content and mentorship opportunities could also help support the important work of small business resource partners, including WBCs and new Community Navigator grantees. More robust interactive educational, training, and mentorship opportunities could help resource partners like WBCs connect a more diverse set of clients with subject matter experts and robust technical assistance programs.

In short, creating a more equitable, inclusive, and leak-proof pipeline for women in STEM may require interventions at multiple levels and from multiple sources. Bolstering STEM education opportunities at the elementary, middle, and high school level could get more women into STEM by the time they reach college. From there, academia, local resource partners, and small businesses can collaborate to help recruit and keep more women in STEM careers and business opportunities. However, plugging the holes in the leaky pipeline that prevents women from achieving their STEM goals will require higher levels of investment at each entry point. By doing so, we might get closer not only to achieving parity but also a more robust recovery and faster economic growth.

NWBC has remained focused on a persistent lack of reliable and affordable childcare as well as limited availability of paid family medical leave (PFML) options as significant barriers to rural women’s entrepreneurship. These factors pose a disproportionate burden to economically distressed communities and childcare deserts,⁸² impacting rural women’s inclusion in business, their return to work and participation in the labor force,⁸³ and the overall national economy. Given these concerns, Council Members serving on the “Rural Women’s Entrepreneurship” policy subcommittee evaluated relevant research, held a policy roundtable on available PFML options across the country, and discussed policy trends and viable approaches for supporting the U.S. care economy⁸⁴—an industry critical to ensuring the wellbeing of children, the elderly, working parents, and women entrepreneurs. NWBC also participated in SBA’s “2022 Women’s Business Summit”⁸⁵ this year. Executive Director Tené Dolphin moderated a panel titled: “From Essential Worker to Essential Entrepreneur: CARE Economy Entrepreneur Opportunities,” which delved into the lack of support for the childcare industry.⁸⁶

On background, U.S. small business owners are still contending with significant labor shortages,⁸⁷ recruitment and retainment challenges, and bear the important responsibility of managing their current employees’ family care needs.⁸⁸ COVID-19 exacerbated these challenges. Those who rely on care economy services to either work or run a business have been left with fewer options amid a post-pandemic economic recovery. This growth-stunting challenge has been most pronounced for businesses operating in rural and other economically distressed communities.⁸⁹

Women business owners continue to invest additional time, effort, and personal resources as they strive to balance work and business demands, while shouldering much of their family and household responsibilities with fewer networks of support. According to recent estimates, about “half of Americans across twenty-two states live in areas with an undersupply of child care options”—that is to say, in childcare deserts.⁹⁰

Moreover, according to a 2021 NAWBO survey, about “31 percent of women business owners have school-aged children,” and of those business owners, “over 61 percent reported that school closures affected their business during the pandemic,” forcing many to scale back their business due to a lack of childcare.⁹¹ Additionally, approximately “a quarter of women 45 to 64 years old, and one in seven of those 35 to 44, are caring for an older relative.”⁹²

Limited access to affordable and reliable child- and elder-care coupled with lack of access to employer-based PFML⁹³ seemed to have contributed contributed to decreases in women’s workforce participation. Consider the following sobering facts:

The available research mirrors much of NWBC’s PFML policy roundtable participants’ feedback and learnings. Some of the key observations from this policy discussion include the following:

Additionally, NWBC considered the lack of robust supports for the care economy. As highlighted by Diedra Henry-Spires, senior advisor to the SBA Administrator, during SBA’s “2022 Women’s Business Summit”, post-pandemic employment for the female-dominated childcare industry continues to lag behind recovery in other sectors, hampering women’s return to work.¹⁰¹ Another panelist, Allison Robinson, Founder and CEO of the Mom Project, underscored that from the childcare providers’ perspective, they simply cannot staff to meet the demand, whereas other sectors have been able to raise wages to attract and retain employees.¹⁰²

All these factors—the lack of access to both affordable and reliable childcare, PFML options, and the lack of supports for the overall care economy— remain significant barriers to advancing women’s entrepreneurship, particularly in rural, tribal, and other economically distressed and underserved communities. Moreover, though proposed legislation on PFML stalled last year, the Council urges a renewed focus on exploring a bipartisan, sustainable, and holistic national solution that addresses PFML and care economy concerns. NWBC also encourages the White House and Congress to reassess and identify best practices to improve support for caregivers and those relying on them. Further review and reconsideration of viable, sustainable solutions would arguably allow more women business owners to maximize their workforce and increase their economic participation, making them more competitive in the U.S. and abroad.

Council Members in the Rural Women’s Entrepreneurship subcommittee agree that while there is certainly general awareness about long-standing issues holding back rural women entrepreneurs’ growth, there is insufficient research on the current state of rural women’s entrepreneurship to adequately support evidence-based changes in policy. The dynamics of issues such as, limited access to broadband, financial services, alternative sources of capital and business financing, meaningful mentorship opportunities, and a skilled talent pool¹⁰³, have changed since the onset of the pandemic. However, the research on U.S. rural women’s entrepreneurship has not. As such, Council Members discussed the need for a new landscape study on rural and tribal women’s entrepreneurship to provide policymakers with fresh learnings on a variety of issues, including workforce development, inter-organizational collaboration, and local governance and capacity issues.

Currently, the available research and Council Member insights help shed light on some of the most pressing issues facing rural women small business owners today. During subcommittee discussions, Council Member Shakenna Williams raised that some of the most educated and skilled graduates continue to move away from rural communities after completing their undergraduate and postgraduate education. And those who attain degrees out of state usually never return, resulting in a real “brain drain”¹⁰⁴ in rural communities. They are often pushed to search for higher paying jobs to cover the rising cost of living and student loan obligations¹⁰⁵, which leaves a vacuum of skilled talent that is hard to fill. Similarly, recent research on workforce development issues in rural America reveals that:

Additionally, Council Member Jaime Gloshay underscored that it is critical to explore local governance and capacity issues, which can impact effective implementation of federal entrepreneurial development¹¹¹ and workforce development programs.¹¹² For instance, local leaders may not have the resources, human capital, or technical expertise to tap into federal grants or other opportunities. A landscape analysis would provide important learnings about how to better support and create an environment that attracts people back to work, or alternatively, encourages entrepreneurship and investments in local rural communities.

Both Council Member Gloshay and NWBC Executive Director Dolphin also noted the importance of leveraging the findings to gain insights as to how the SBA, other federal agencies, and small business resource partners such as Women’s Business Centers (WBCs) could expand their collaboration with universities, including minority serving institutions (MSIs) as well as explore innovative partnerships.

The Bipartisan Infrastructure Law (BIL) includes $65 billion in provisions to ensure broadband access for all Americans and prioritizes investments in marginalized and underserved communities, many of which are rural.¹¹⁶ Certain provisions in BIL direct billions of dollars in investments to support reliable and green energy infrastructure, restore degraded lands, ensure climate resilience, and modernize existing infrastructure.¹¹⁷ These investments are coupled with those made in the Inflation Reduction Act (IRA), which further supports a clean energy transition across the country.

Given these investments, NWBC is especially focused this year on ensuring that women entrepreneurs, including those operating in rural and economically distressed communities, are not left out of future procurement and wealth creation opportunities. Rural women entrepreneurs require fair and equitable access to the entrepreneurial resources, training, and diverse financing products to succeed. As the White House champions investments in infrastructure and workforce development initiatives, NWBC will continue to underscore the importance of collaborative partnerships between rural ecosystem builders, small business resource partners, and universities, including historically black colleges and universities (HBCUs) and minority serving institutions (MSIs). The aim is to ensure that organizations are better positioned to expand their networks of support and assist rural women business owners in increasing their participation in high revenue, tech, and green economy markets.¹¹⁸

New research on rural women’s entrepreneurship could help pinpoint burgeoning rural communities with access to broadband. It could also provide useful insights on the extent to which improved infrastructure and connectivity is helping support local ecosystems and small business resource partners as they innovate and improve delivery of resources, entrepreneurial development programs, mentorship opportunities, and technical assistance services. For instance, current data suggests that facilitating the use of online tools and technology have the highest potential impact on rural small businesses with revenue under $100,000.¹¹⁹ Moreover, increased adoption of online tools and digital services for businesses across rural America could result in over 360,000 jobs created in the next three years.¹²⁰

Increased adoption could also grow annual revenues of rural small businesses by more than 21 percent over the next three years; the equivalent of $84.5 billion per year with states in the South seeing the greatest benefit.¹²¹ Notably, at the time of the writing of this report, the Biden-Harris Administration announced it is now providing $759 million to bring high-speed internet access to U.S. rural communities¹²² in the form of loans and grants as part of the USDA’s “Reconnect and Loan Program” with BIL funding.¹²³ As Council Member Jaime Gloshay noted during subcommittee discussions, it is important to address longstanding barriers to entrepreneurship due to an unresolved digital divide, and achieving “digital equity” could truly serve as an “economic stabilizer” at the local and national level.

Another consideration is the potential for rural and tribal growth in industries, such as green energy. Note that while the service industry is currently the most prevalent industry in rural (and non-rural) regions, especially among rural women-owned businesses,¹²⁴ as of 2019 the total number of clean energy jobs in America’s rural counties outnumbered fossil fuel jobs by 1.5 times.¹²⁵ Additionally, clean energy jobs also outnumber fossil fuel jobs in 81 percent of rural counties (1,592 out of 1,976 rural counties).¹²⁶ The energy efficiency and renewable energy generation sectors alone employed 260,853 workers, compared to 235,618 workers employed in the fossil fuel industry across all rural counties.¹²⁷

Also notable, workforce development initiatives such as the U.S. Department of Labor’s (DOL) current “Workforce Opportunity for Rural Communities” (WORC)¹²⁸ initiative, designed to facilitate the alignment of workforce development efforts with existing economic development strategies in rural communities hard hit by economic transition and that are slow to recover, will be key to connecting both sole proprietors and employer-based women owned firms to emerging procurement opportunities in these industries. Specifically, the WORC Initiative provides grant funds to enable communities to develop local and regional workforce development solutions. It also supports workforce development activities that prepare dislocated workers, new entrants to the workforce, and incumbent workers for good jobs in high-demand occupations.¹²⁹

Despite these important efforts, more can be done to draw talent back into rural communities. Notably, SCORE’s Fall 2022 “Megaphone of Main Street: The Small Business Rural/Urban Divide” report, which surveyed more than 3,000 entrepreneurs, discovered that, “population shifts away from rural areas are challenging small business owners in desperate need of reliable talent and technology.”¹³⁰ And, as previously noted, Council Member Shakenna Williams observed that finding skilled talent will continue to pose a challenge given that individuals from rural communities who obtain their graduate and undergraduate degrees outside of their state and local communities typically do not return. Council Member Gloshay shared similar observations during policy subcommittee deliberations, highlighting that the same phenomenon takes place in tribal communities as individuals begin to see more economic opportunity in urban spaces.

As such, innovative solutions such as providing supplemental funding to small business resources partners, particularly Women Business Centers (WBCs) partnering with, for example WORC grantees, could potentially aid rural employer-based businesses in recruiting skilled staff or opening avenues for more partnerships between rural “solopreneurs.” Such an approach would align with existing economic development strategies and community partnerships to promote new, sustainable job opportunities and long-term economic vitality in rural America that is more inclusive of rural women entrepreneurs, ensuring they are engaged, supported, and strongly positioned to take advantage of tomorrow’s tech and green market opportunities.

The Biden-Harris Administration has begun to move forward on its plan to improve infrastructure as well as coordination and delivery of accessible resources and locally customized entrepreneurial supports for more Americans living in rural areas and tribal communities, in part by leveraging BIL— the Bipartisan Infrastructure Law.

In this regard, the White House underscores that its purpose is to “provide high-speed internet, safe roads and bridges, modern wastewater systems, clean drinking water, reliable and affordable electricity, and good-paying jobs in every small town and rural community.”¹³¹ As part of this effort, it is also “working with communities to help them access federal resources and improving transparency and trust in the federal government.”¹³² NWBC lauds these efforts and encourages expansion of coordinated efforts at the local level to better serve rural communities, while also prioritizing outreach to rural and tribal women entrepreneurs so that they can take full advantage of these emerging opportunities.

One example of ongoing investments in improving the delivery of resources and services to rural communities is the U.S. Department of Agriculture’s (USDA) Rural Partners Network (RPN). “RPN, a whole-of-government initiative … focuses on transforming the way federal agencies partner with rural places to create economic opportunity.” RPN helps ensure rural voices are heard at the national level by placing new federal field staff in more than twenty-five rural communities in multiple U.S. states, Tribal Nations, and territories. This promising initiative can “help local leaders navigate and access … federal resources … to build a strong and vibrant economy.” The SBA is one of more than twenty federal, active partners involved in this network.¹³³

More specifically, RPN staff are tasked with identifying challenges preventing rural communities from accessing federal support, which in turn will also aid the work of the Rural Prosperity Interagency Policy Council (RPIC). The RPIC government task force was established to ensure rural places are prioritized. As such, it is responsible for sharing lessons learned from selected communities with federal agencies to ensure rural communities have a voice in the policymaking process. Additionally, “policy development occur[s] through regular convenings of the … [RPIC], co-led by USDA and the Domestic Policy Council. There are sixteen federal agencies and regional commissions participating in the Council.” ¹³⁴

According to some analysts, this bottom-up, collaborative approach would likely render more impactful rural development¹³⁵ outcomes and better support a local community-based approach specifically by helping “rural communities navigate federal programs, build relationships and identify community-driven solutions, and develop successful applications for funding,”¹³⁶ as previously referenced. Notably, at the time of the writing of this report, RPN was expanded to four additional states and Puerto Rico.¹³⁷

NWBC is encouraged by the establishment and expansion of RPN to an additional seventeen communities in four more states and Puerto Rico. RPN’s focus on helping coordinate local partnerships will help support local job creation and ensure both minority and women-owned businesses are given a fair chance at procurement opportunities so that they can contribute to building up their own local infrastructure and communities. While these are meaningful steps toward engaging and better serving rural communities, NWBC encourages the White House’s continued prioritization and participation of rural women business owners in these initiatives. 

The Council’s subcommittee discussions this year aligned with the Biden-Harris Administration’s new direction on providing improved coordinated federal services to rural entrepreneurs and small business owners, which involves taking a bottom-up, local approach. Effectively connecting more rural and tribal women entrepreneurs to federal resources, however, also necessitates the expertise and direct involvement of culturally competent and trusted community-based organizations. Organizations with authentic connections to local ecosystem builders, service providers, and educational institutions involved in standing up and executing women’s entrepreneurial development programs should be of particular interest. Furthermore, casting a wider net to ensure culturally tailored “wrap around supports” reach more diverse women small business owners, including those situated in the most remote locations or those operating in traditionally male-dominated high-yield industries, will be vital.

During subcommittee discussions, Council Members observed that for some rural and tribal women small business owners, the lack of meaningful industry-specific mentorship opportunities along with culturally tailored “wrap around services” continue to stymie women small business owners’ growth, including “solopreneurs.”¹³⁸ Rural and tribal women entrepreneurs continue to contend with multiple barriers due to the lack of: customization for their industry, physical proximity, convenient office hours, transportation and digital infrastructure, as well as a lack of brick and mortar financial service providers¹³⁹. The toll of post-pandemic economic recovery only further exacerbates these inequities.

Likewise, some small business resource partners, including Women Business Centers (WBCs), may lack sufficient funding and human capital needed to significantly expand their reach and better serve greater numbers of rural women entrepreneurs, including those in the most remote and economically distressed communities. Some overextended WBCs, and certain other small business resource partners, may struggle to balance both grant program requirements and the growing needs of not just a few surrounding communities, but even a whole state. Such a situation puts rural and tribal women entrepreneurs at a clear disadvantage when it comes to accessing fair, non-predatory financing opportunities, federal resources, grant opportunities, both federal and private procurement opportunities and actual contract awards. For example, Council Member Selena Rodgers Dickerson has noted several examples of local entrepreneurial support services simply disappearing over the last couple of years, diminishing business hours, or staff not having the requisite expertise to assist with procurement opportunities in traditionally male-dominated fields (e.g., AEC industry).

Despite this, WBCs and other small business resource partners continue to forge ahead. In tandem with SBA regional and district offices, these organizations heroically innovate and work to discover improved entrepreneurial development supports for rural and minority women business owners. And, with the recent expansion of the RPN, these resource partners are more strongly positioned to

serve as both a referral point for entrepreneurs, and also as a feedback loop to both the RPN and RIPC on urgently needed policy change. Also notable are the various federally led but locally based resources and small business resource partners¹⁴⁰ supporting rural entrepreneurs, many of which are outlined in the “Resiliency Resources” section of this report. They include, but are not limited to:

However, Council Members also commented on not only the value of identifying innovative and replicable outreach models, but also anticipating the level of funding required to stand up, tailor, and eventually expand these programs’ physical reach and impact. For instance, Council Member Jaime Gloshay highlighted on several occasions that there is a lack of attention and resources to ensure impactful outreach to the underserved, or traditionally overlooked, rural communities. She noted, “we must truly work at making the historically ‘invisible,’ such as tribal communities, ‘visible,’ and provide these communities that often fall prey to fraudsters and predatory lending practices with trusted, culturally tailored wrap around services.”

Therefore, while the establishment of new programs and initiatives such as the RPN stand to better support the needs of rural and tribal entrepreneurs, there must be a continued focus on prioritizing and addressing the needs of rural and economically disadvantaged women entrepreneurs. Learning from successful community-based program models and collaborative partnerships, reevaluating the actual resources needed to reach more individuals with meaningful mentorships and targeted services, and instituting robust benchmarks and metrics will be key to bolstering minority and rural women entrepreneurs.