For more than a decade, women have been at the vanguard of Canadian workers who have turned to self-employment or small business ownership. Today, women make up more than one-third of the 2.3 million Canadians who fall into that employment category.

Many have moved into non-traditional “upper-tier” occupations, including management, educational, professional, science and technical services. At first blush, it’s encouraging news.

But Karen Hughes, a sociology professor at the University of Alberta, says we really only have a snapshot of what’s happening to women.

While there are “gazelles,” those who are running successfully with the opportunities presented to entrepreneurs in the knowledge-based economy, many others have been pushed into self-employment – and are suffering.

Karen Hughes

It’s important to remember that major change occurred in the 1990s when the public and private sectors downsized dramatically. Observers aren’t convinced the trend into self-employment and small business ownership will continue.

“It’s not a black-and-white picture,” says Hughes, who specializes in gender, work and labour market issues.

“It’s a complex phenomenon that we need to know more about.”

Earlier this summer, Hughes spoke in Ottawa on “How are Women Faring in the Entrepreneurial Economy?”

Speaking to the Canadian Federation for the Humanities and Social Sciences, she noted that 1990s downsizing propelled small business and self-employment to where it accounted for almost 60 per cent of employment growth between 1990–1997.

Women were at the forefront. They started small and micro-businesses in record numbers, to the point that female self-employment in Canada is the highest of all the Organization for Economic Co-operation and Development (OECD) countries, including the United States.

“As prime minister, Chretien likes to say: ‘We’re No. 1,” laughs Hughes. “But it’s a statistic that has to be tempered. There are people who want to be entrepreneurs, but statistics also show that one in five people were pushed into it over the past decade because of downsizing. That’s a significant number.”

There’s a disturbing financial picture as well. Roughly half the women who are solo self-employed – people who work alone, without employees, in either incorporated or unincorporated businesses – earn less than $20,000 a year. Another 30 per cent make between $20,000 and $40,000.

Twenty per cent earn more than $40,000. In contrast, self-employed women who run businesses are better off. Only 25 per cent of women employers earn less than $20,000. And 25 per cent earn more than $60,000 a year.

Indeed, it’s a mixed bag. Many women fear for their current economic well-being, their limited access to standard benefits and their retirement future.

But women also seem highly satisfied with their greater independence, flexibility, ability to make decisions and personal fulfilment from their work.

“In general, I would say that the women who are doing well are the ones who wanted to work for themselves,” says Hughes. “The ones who were pushed into it aren’t.

“The successful ones are those who I’d call ‘intentional entrepreneurs’, people who at a young age knew they wanted to be an entrepreneur. They might have come from a family background that had a small business. Or they may have moved from a corporate environment where, in an intentional way, they got their training and said: ‘In five years, I’ll take this (knowledge) to my own company.’ ”

On another positive note, more young women are interested in self employment. This attitude may make sense because of the turbulent (economic) climate in which they have grown up.

A 1998 report by Industry Canada, Shattering the Glass Box, notes that the number of self-employed young women under 30 years of age rose by 30 per cent from 1991-96 (compared to just a four-per-cent increase for men).

Hughes says many young female entrepreneurs she’s worked with in an Edmonton research study believe that they are better off creating their own security.

“This bodes well because traditionally, people have become self-employed when they are older, when they have the skills. A lot of younger women who are starting their businesses tend to be better educated, bringing more skills to their business.”

In her Edmonton group, Hughes is excited to see women entering non- traditional areas of work: one is a building inspector for residential and commercial properties; another is a registered nurse who consults builders on creating seniors’ complexes.

In previous generations, women who have been self-employed or small business owners have worked in labour-intensive sectors such as child care and cleaning and food services, where remuneration was typically low.

Now women are moving into the knowledge-based sector, which offers better pay, and the chance to create businesses with little more than a computer and some office space.

Hughes believes the large numbers of women moving into self-employment and small business ownership is important in the long run. It is a sector where women have been under- represented, especially as employers.

According to a recent Labour Force Survey study, women now represent 25 per cent of (small business) employers, compared to 11 per cent in the mid-1970s. (Data suggest that two-thirds of these self-employed small business employers have less than five workers. But there is a small proportion with 100-plus employees.)

So what lies ahead? While the downsizing of the 1990s contributed to this trend, another major shift looms – the retirement of the baby boomers.

“It’s difficult to know,” says Hughes. “My sense is that part of it is structural. I think the knowledge sector lends itself to self-employment.

“The trend will continue, I just don’t know if it will continue as intensely.”

NOTE: The full text of Karen Hughes’ Ottawa speech can be found at: http://www.cprn.org/en/doc.cfm? doc=338