The share of women-owned businesses in
Central America rose by almost 60 per cent (from 13.9 to 24.5 per cent) between
1991 and 2018, according to a new ILO publication.
Case studies from Costa Rica, El Salvador, Mexico (Chihuahua) and Panama show
that, on average, 22.3 per cent of business owners in Costa Rica are women, 29
per cent in El Salvador, 15.3 per cent in Chihuahua, Mexico, and 22.4 per cent
in Panama.
The factors driving many women to start their own businesses are precarious
economic conditions, lack of career prospects in companies and the absence of
well-paid job opportunities.
The publication, Women in business in Central
America , issued by the ILO’s
Bureau for Employers’ Activities (ACT/EMP), says that women’s success as
business owners and employers can be influenced by the size of their
enterprise, the economic sectors in which they operate, education and
professional experience.
The case studies also showed that women entrepreneurs were better educated than
men in Costa Rica, Mexico (Chihuahua) and Panama, and had similar education
levels in El Salvador.
Nevertheless, in all four areas, the average levels of profit from businesses
run by women was lower than those run by men. For example, in Panama the
average monthly profits for male own-account workers and employers* were higher than for women, by more than 78 and 40 per cent,
respectively. The difference in profits between men and women entrepreneurs
becomes more acute when moving up the earnings distribution. Among those in the
top 10 per cent earnings level (90–100 percentile), women make on average
US$663 less than men.
The Costa Rica case study found that the more experience women have in running
a business, the more successful they become. It showed that while relatively
young enterprises (up to nine years of operation) are more profitable when they
are run by men, this is not the case with mature enterprises managed by
better-educated women. These enterprises can be as profitable or even
significantly more profitable than those managed by men.
“Improving access to finance or an affordable cost of capital through
development banking for women is a critical step to supporting their endeavours
and enabling them to become more successful when their businesses are growing,
said Deborah France-Massin, Director of the ILO Bureau for Employers’
Activities.
