In 2023, a significant increase in the participation of women and minorities was observed in the number of new business applications. This trend continued from the start of the pandemic in 2020, when there was a jump in new business applications. Gusto, a payroll firm, surveyed 1,300 small business owners who started their business last year to understand their characteristics.
The study revealed that women made up 49% of the new business owners surveyed, a sharp increase from 29% in 2019. Despite this progress, women entrepreneurs still face challenges in accessing investments, with only 3% receiving private capital investment compared to 9% of male entrepreneurs in 2023.
The study also showed an increase in minority entrepreneurship. Black entrepreneurs accounted for 6% of new business owners in 2023, double the rate seen before the pandemic. Hispanic entrepreneurs made up 13% of new owners, compared to 8% in the previous year. Furthermore, there has been a rise in businesses started as “side hustles,” with 44% of entrepreneurs starting a new business while still working another job, up from 27% in 2022.