Is Gender Inequality in Business Still Prominent? The Gender Index Report 2022
Gender inequality in business is about more than just the wage disparity between men and women; it’s also about female-led companies or their evident lack.
In the UK and worldwide, women continue to face barriers, such as problems accessing external funding, gender biases, skewed household dynamics, or a lack of support, when establishing businesses.
The Gender Index recently published a report that utilised AI-powered technologies to collate data from 4,412,017 active companies and 1,242 venture capital and private equity investors to reveal a deeper insight into the landscape of women in enterprise.
In this blog series, we bring you the key findings of the research and discuss the need to stimulate the growth of female-led enterprises.
The first article will concentrate on the data from England and Scotland, whereas the second part will cover Wales and Northern Ireland.
So, without further ado, let’s jump right in.
National Gender Index Results
We’ll begin with a glance at the national data before moving on to the nuances of each country.
According to the report, active female-led enterprises account for 16.8% of all UK businesses. Interestingly, in 2021 one-fifth of newly established companies were female-led, which shows that the gap could be slowly narrowing, but it’s still not enough.
The most apparent inequality across the UK exists in high-growth companies. These include FinTech, digital security, financial services, property and land development, and medical instrumentation.
Strikingly, there are clear tendencies when it comes to business funding. The majority of investment in the UK goes to male-led enterprises (66.1%), with just 11.9% going to female-led companies, and the rest flowing to mixed-leadership businesses. Furthermore, the angel is the most common type of investment in women’s startups, with female angels being more inclined to invest in fellow women entrepreneurs.
Finally, the leadership composition in the UK greatly varies depending on the sector. Male-led companies dominate most industries; however, female leadership is more pronounced in the health, wellbeing, social care, and education sectors. This might be explained in part by the large proportion of female professionals in these fields, or by the overall skewed perception that women are better suitable than males in these sectors.
Findings for England
Data obtained for England demonstrates that out of all the nations within the UK, it has the highest percentage of female-led businesses.
Stark Differences Within Regions
Nevertheless, there are some evident disparities between different parts of the country. Illustratively, statistics reveal that London (18.3%) and the South East (16.8%) have the most female-led enterprises, whereas Yorkshire and the Humber (15.6%) and the North East have the least (15.3%).
Evidently, in the northern regions of England, in several high-value-added industries, women-led enterprises remain underrepresented. This could be partially attributed to the widening north-south divide, with more government investment flowing into the London metropolitan area.
Below-Average Female Representation in Tech and Finance
Women in the technology and finance industries face numerous obstacles; the lack of diversity and bias makes success in these fields challenging.
According to data, only 9.1% of women lead financial services firms and 12.2% run tech and communications enterprises. Consequently, this limits a country’s ability to lead innovations and generate higher revenues through a diverse workforce.
What’s the Situation in Scotland?
Relative to the UK average (16.9%), Scotland has a slightly lower rate of female-led businesses (15.4%). Strikingly, Scottish data reveals that female-led high-growth enterprises are more widespread in Scotland (12 %) than in the rest of the UK (8.7%).
However, the Gender Index reveals that raising capital in Scotland is more challenging than in the rest of the UK. Out of 34,385 women-led companies, only 6,980 (3.1%) attracted external investment, potentially limiting their growth potential.
In Scotland, specific industries, such as arts, entertainment, recreation, education, and health and wellbeing, seem reasonably well represented compared to the rest of Britain. Nonetheless, finance is one of the industries where female-led high-growth enterprises are either absent or present in minimal numbers, which reveals a grim situation for Scotland.
We’re Prepared to Help You Challenge the Status Quo
The 200 Billion Club believes we’re still far from a fair representation of women in business. Our goal is to help female founders secure funding and achieve their full potential by breaking stereotypes and stigmas.
Do you want to learn more about our expert-led 12-week programme for women founders, which teaches how to pitch effectively, negotiate powerfully, and put your business in the best position for funding success?