Building a small business is never easy, but the reality of the past two years has made it especially tough. And yet, more and more women are showing up with resiliency and determination to see their vision through. In turn, the best states for women entrepreneurs continues to expand.
Although this fresh wave of female entrepreneurship can be felt across the country, not all states are made equal. That’s why we’re turning to the data to understand where in America offers the best conditions for women-owned businesses to start, build, and grow.
We kept a variety of factors in mind when determining the best states for women entrepreneurs, including:
- Percent of women-owned businesses
- Women-to-men pay ratios
- Unemployment rates for women
- Start-up survival rates
- And more
Here’s what we found.
The Top 10 States for Female Entrepreneurs
While the East is clearly leading the charge, we’re seeing states from coast to coast come together to support the future women-owned businesses.
Rounding out the top 10, Georgia is booming with opportunities for female entrepreneurs. 17.51% of businesses in the state have been operating for less than two years, and it has one of the lowest unemployment rates in our top 10 at 4.22%.
It’s clear that Georgia’s small business community is thriving, and that’s no different for women-owned businesses in the state. 9.38% of the businesses in Georgia are female owned, and the state ranks seventh nationally for the percentage of women-owned businesses with 500+ employees.
As one of the smaller US states, Hawaii’s business community isn’t as prolific as others. In fact, it has the lowest percentage of new businesses on the list and just a 75.09% startup survival rate. With that said, the island is still an oasis for female entrepreneurs and still has become one of the best states for women entrepreneurs. It boasts the lowest unemployment rate for women in our top 10—and fifth lowest nationally—at 54.11%.
Missouri’s business community is on the up and up. More entrepreneurs are setting up shop in this Midwestern state than most others on the list, with 17.09% of businesses being less than two years old. Missouri also has one of the lowest unemployment rates for women at 57.36% and the lowest overall unemployment rate at just 3.21% compared to the other states on our list. That means Missouri’s business community is a safe haven for young, growing businesses.
Texas has seen a boom in business growth over the last couple of years. The Lone Star State ranks seventh nationally for the percentage of new businesses at 18.18%. It also has the second highest startup survival rate in our top 10 at 79.63%.
Texas offers a ton of opportunities for female entrepreneurs, too. It has one of the highest numbers of women-owned businesses in the country at a whopping 1.4 million, 2.11% of which have over 500 employees. That’s the fourth highest overall compared to all 50 states.
6. New Mexico
Although it has less women-owned businesses than its neighbor to the north, New Mexico is a strong contender in its own right. Boasting the highest startup survival rate on the list at a whopping 80.09%, entrepreneurs can rest easy knowing that the southwestern business community is low on risk and high on potential.
New Mexico still puts up respectable numbers when it comes to women-owned businesses, too. 9.58% of businesses in the state are run by female entrepreneurs, and it has the second lowest unemployment rate for women at 54.87%.
Kicking off our top five is Florida—and for good reason. Not only does the Sunshine State have a booming business community, it offers great conditions for female entrepreneurs. It has the highest number of women-owned businesses in our top ten at over 1.5 million, the second highest percentage of women-owned businesses with 500+ employees at 1.90%, and the third highest women-to-men pay ratio in the country at 80.22%.
On top of all that, Florida has one of the lowest overall unemployment rates on the list at just 3.69% and ranks eighth overall for the percentage of new businesses.
When it comes to good places to launch a business, Maryland is not to be overlooked. This eastern state has one of the highest startup survival rates on the list at 76.65%, making it the perfect place to set up shop.
Not to mention, Maryland puts up some excellent numbers that favor entrepreneurial women. It has the third highest women-to-men pay ratio on the list at 78.61% and the lowest unemployment rate for women in the top five.
Virginia joins the ranks as our third best state for women entrepreneurs. Not only does it have one of the highest percentages of women-owned businesses in the country at 10.12%, it also has the second lowest overall unemployment rate at 3.58%. Together, these insights show how well Virginia supports its small business community, female entrepreneurs included.
Coming in at number two, Nevada is a powerhouse state for female entrepreneurship. The Silver State ranks in the top 10 nationally for five out of seven of our qualifying metrics. In particular, Nevada has the fourth highest overall women-to-men pay ratio at 79.60%, the second highest percentage of women-owned businesses at 10.17%, and the eighth highest percentage of women-owned businesses with 500+ employees at 1.80%.
Nevada also has the highest percentage of new businesses on the list at 20.94% and one of the highest startup survival rates, making it a great place to launch a business.
Leading the way as the best state for women entrepreneurs is Colorado. Not only does this state have a 76.86% startup survival rate, it also has one of the highest percentages of new businesses nationally. That means more entrepreneurs are setting up shop in the Centennial State than any other—and most of them stand the test of time. Colorado also has the highest percentage of women-owned businesses in the entire country at 10.39% so any female entrepreneur that launches a business here will be in good company.
For this report, we gathered data from eight separate metrics for all 50 US states. In order of priority, the data includes: % of women-owned businesses, % of women-owned businesses with 500+ employees, number of women-owned businesses, startup survival rate, women-to-men pay ratio, unemployment rate for women, overall unemployment rate, and new businesses as a % of total businesses.
Our data was pulled from three separate sources:
- Census Bureau 2020 Annual Business Survey
- 2020 ACS 1-Year Experimental Data
- 2020 Kauffman Indicators of Entrepreneurship
Despite the pandemic, business is still booming and female entrepreneurs are leading the way. Even though there’s still work to be done, it’s exciting to see the steps being taken to support entrepreneurial women across the country and seeing more states added on to the list of best states for women entrepreneurs.
If you’re thinking about starting a business in your own home state, remember: we at NorthOne have your back. Let’s get to work.