Support programs must address needs of women entrepreneurs — or they won’t help
Right now, businesses across the country are gearing up to reopen their doors after 15 long, turbulent months. While this moment brings a sense of excitement and optimism, it also presents a great deal of uncertainty for many Canadian entrepreneurs as they consider the post-pandemic viability of their businesses. For women entrepreneurs, decisions made now are especially fraught since they generally have less access to capital, and their businesses tend to be smaller and more likely to operate in industries hit hardest by the pandemic, like the retail and service sectors.
As the recovery unfolds, unevenly and in real time, women entrepreneurs are asking themselves whether they can afford to keep going, often at reduced capacity. Moreover, on what basis should they decide? Is there a plan in place to help businesses like theirs stay alive, and how quickly will relief come?
The good news is the Canadian government recognized the need to support women entrepreneurs through the post-pandemic period by allocating up to $146.9 million over four years to the Women Entrepreneurship Strategy in Budget 2021. But as we’ve learned from past experience, funding alone won’t help if the spending does not account for the specific needs, priorities and challenges of women entrepreneurs. According to a McKinsey report from 2017, advancing women’s equality in Canada has the potential to add $150 billion to the GDP by 2026. But if we get this high-stakes recovery period wrong, we are at risk of setting women back by half a decade.
We know there are clear economic and social benefits to investing in women entrepreneurs. As of 2019, women-owned businesses already contributed $150 billion to the Canadian economy and employed more than 1.5 million people. However, a recent report from the Women Entrepreneurship Knowledge Hub (WEKH) on the impact of COVID-19 on women-led businesses identified several significant shortcomings among Canada’s existing funding programs. For instance, women entrepreneurs are more likely to be self-employed than owners of small and medium-sized enterprises with employees. Still, many government programs — such as wage subsidy programs — are designed to support firms with employees. Other programs favour organizations that are in a position to take on more debt, which excludes many self-employed women and women-led businesses which, according to WEKH, gravitate toward smaller investments over longer periods of time. A recent report from the Black Business and Professional Association, which surveyed 700 Black female entrepreneurs across Canada, found that 78.5 per cent of them reported experiencing difficulty accessing financial support during the pandemic.
Canada is now in a position to learn from its past oversights and also to benefit from what countries further along in their reopening phases have learned about how better to support women entrepreneurs. In Germany, for example, women entrepreneurs were often found to be hesitant to apply for financial support due to unclear guidelines on how the money must be spent, whether the rules applied to them, and if, how and when the funding would need to be repaid. This reinforces the need for clear communication, accessibility and eligibility guidelines, and program timelines for all financial support initiatives.
Beyond financial investments, women entrepreneurs may require additional social support during the upcoming transition phases of Canada’s reopening plans. As restrictions continue to lift during the summer and fall months, there will be talk about returning to “normal.” However, the pandemic reshaped what “normal” might look like.
For some women, remote work created professional opportunities, along with a greater sense of freedom, flexibility and creativity at work. It’s well documented, however, that remote work and virtual schooling presented disproportionate challenges for women forced to work full time and parent full time simultaneously. A recent BDC survey found that 40 per cent of women business owners admitted that mental health challenges during COVID-19 have interfered with their ability to work.
Therefore, considerations around child-care needs, mental health needs, hybrid models of work, and flexible working hours could be essential in supporting women entrepreneurs. For instance, while many Canadian provinces have outlined plans to increase mentorship, training and networking opportunities for women business owners, the delivery of these services must also be configured to best support women both in person and online, and at flexible times.
-The Star