a day ago
- Business
- The Herald Scotland
Alarm as women-led businesses 'fail to thrive' in Scotland
WES has found that while women-led start-ups have increased to 54% of the total, the post-start-up pipeline has an attrition rate of 61%. Women-led employer businesses have dropped to just 20% of all employer businesses, its research shows.
According to the organisation, the declining trend in Scotland stands in contrast to the global increase in established women-led businesses. This 'exposes a key disconnect' between Scotland's 'thriving' start-up culture and the inability of many such businesses to make it to the growth phase.
WES declared that improving the current outcomes for female-led start-ups has the potential to unlock an estimated £17 billion boost to the Scottish economy every year.
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Carolyn Currie, chief executive of Women's Enterprise Scotland, said: 'A perfect storm of economic conditions and structural inequalities is halting the progress of women-led businesses, despite their start-up successes. What we are seeing is an alarming number of new women-led businesses failing to thrive. They are simply falling into an abyss, leaving their economic potential and the ambitions of their founders unfulfilled. The WES survey reveals a clear demand for needs-based business support, with the majority of respondents advocating for a Women's Business Centre model.
'Many of the issues - and suggested actions that need to be taken - have been highlighted in research numerous times over the past 30 years. We can continue to watch talented women entrepreneurs leave the market, taking billions in economic potential with them, or we can implement the evidence-based solutions this study provides. The choice is clear - the community has spoken, and we need to listen. The time for action is now.'
WES noted that successive governments in Scotland have committed to inclusive growth and women's entrepreneurship, most recently in response to the Pathways Report, with up to £2.6m released for support in 2024 to 2025 and at least £4m in 2025 to 2026.
However, it said women's entrepreneurship has not benefited from long-term investment in support provision that is comparable to other areas of business, despite the economic opportunity represented by women as 51% of the population.
The WES survey found that economic conditions are threatening business sustainability and reveals a 'devastating' cost for women-led businesses; 78% cannot recover all their increased costs, 41% cannot recover any cost increases, 55% are using personal savings to capitalise their businesses, and 52% are making no pension provision, threatening retirement security.
