Why Men Outnumber Women in Business Ownership

The statistical discrepancy between the number of men and women who own businesses has long been a subject of debate. One might assume that the gender disparity can be attributed to systemic inequalities, such as the 'evil patriarchy' or biased corporate promotion policies. However, a closer examination reveals that these issues are not as pervasive as popular belief might suggest. This article delves into the reasons behind the higher numbers of male business owners, supported by quick historical context and an exploration of gender differences in career choices.

A Quick History Lesson on Women's Work

For centuries, women's rights to work, vote, and own property were severely limited. The concept of professional women was essentially unheard of until the last century. In the Western world, women's workforce participation only became a significant phenomenon in the late 19th and early 20th centuries. This historical limitation has created a pronounced head start for men in terms of professional experience and networking.

Men vs. Women: Differing Interests and Choices

A common misconception is that men and women are vastly different in abilities, but this is not the case. The differences lie in interests and preferences. Men tend to prefer 'things,' such as technology, engineering, and non-human subjects, while women generally prefer 'people,' like working in human resources, teaching, and similar fields. These differences have a significant impact on career paths and subsequent business ownership.

The Current Landscape of Corporate Diversity

Organizations often value diversity in their team members, making it easier to hire a woman externally for a position where a man is already qualified. Corporates may justify this choice by emphasizing their dedication to gender diversity and equal opportunities. While it is undoubtedly true that women, in general, are capable of holding top positions, the reality is that many women have different priorities. Running a business from scratch and climbing the corporate ladder are both demanding tasks that may not appeal to everyone, especially women.

The focus on hiring external women at the expense of promoting internal men does not align with meritocracy. In many cases, the assumption is that external hires will provide the necessary diversity, ignoring the valuable experience and skills of incumbent employees. This practice sometimes leads to men being pushed out of jobs, as they seek alternative opportunities to start their own businesses.

Implications for Future Business Ownership

Given the current trends, it is likely that the proportion of men in business ownership will continue to rise. The emphasis on 'diversity' as the primary criterion for hiring can make it less likely for internal male candidates to receive promotions. In many cases, the hiring of external women can provide businesses with more diverse perspectives without empowering the existing internal talent. Consequently, the ecosystem that fosters entrepreneurship becomes more skewed toward men, particularly those who are already at an advantage due to past experiences in the corporate world.

These observations can help us understand the discrepancies in business ownership numbers and suggest the need for a more nuanced approach to diversity and inclusion initiatives within corporations. Organizations should strive to balance diversity with merit, ensuring that internal candidates have equal opportunities to succeed.

Conclusion

The gender imbalance in business ownership is a multifaceted issue, reflecting historical, cultural, and individual differences. While efforts to promote diversity are essential, they should be implemented in a way that does not inadvertently disregard the merit and experience of current employees. By focusing on a more integrated approach, organizations can create a more inclusive and equitable environment that benefits all employees, regardless of gender.