How women entrepreneurs reshaped the American economic landscape in the wake of World War II
When the National Foundation of Women Business Owners announced in May 1999 that women own nearly 40 percent of the nation’s businesses, there was little fanfare or surprise. Americans have become increasingly accustomed to female entrepreneurs as an economic force. Since 1987, the number of women-owned small businesses has more than doubled, to 9.1 million firms generating $3.6 trillion in annual sales.
The women’s legacy dates back to World War II, when national leaders and mainstream citizens alike began to see the vast potential of small business for women’s lives as well as for the country’s prosperity. By 1944, leaders like Maury Maverick, the director of the Federal Smaller War Plants Corporation, were promoting small-business ownership as a natural vehicle for women, one that would help ease them from their wartime jobs to make way for returning soldiers. “When you get right down to brass tacks, the basis of small business is the home,” Maverick said.
The idea was embraced by New York’s governor, Thomas Dewey, who in 1945 appointed Jane Todd the first woman deputy commissioner in the State Department of Commerce. Todd launched a state Women’s Program and almost instantly joined forces with governments in Texas, Michigan, Ohio, Pennsylvania, California, and Maine, along with the National Federation of Business and Professional Women, to run “small business clinics” nationwide. These encouraged women to develop products like mayonnaise and salad dressing, which had been in short supply during wartime rationing, and taught them how to get their products in retail outlets. As a result, the number of women business owners shot up from 600,000 in 1945 to almost a million just five years later.
In the 1950s, politicians, priests, and journalists debated the effect of working women on the family. And all the while the production of homes and consumer goods placed increasing demands on household incomes. Many women turned to home-based businesses to fill the gap. By 1957, the Women’s Program reported over 750 requests daily from as far away as Alaska for its booklet “A Business of Her Own.”
Lillian Vernon, whose firm 1S sales last year topped $238 million, was typical of the women who sought such information, launching her catalogue business from her kitchen table in 1951 while pregnant with her first child. Decades later, she recalled the challenge: “Hovering in the background was always the accepted idea that a working wife was an embarrassing commentary on her husband’s earning power. … I had to earn money, but I couldn’t leave the house.” Thus a trend developed: While men sought security in the 1950s workplace, entrepreneurial women wore the mantle of risk-taking pioneer.
During the 1960s, women were finding a waiting market for their skills as the economy shifted from manufacturing- to service-based. In 1963 Jean Nidetch, a self-described “overweight housewife,” launched what would become the diet empire Weight Watchers. That same year in Dallas, Mary Kay Ash began a cosmetics dynasty.
By the 1970s, as the women’s movement grew, feminists were opening credit unions, banks, and publishing businesses designed specifically to serve women’s needs and abilities. On the policy front, the National Organization for Women helped pass the 1974 Equal Credit Opportunity Act, which barred gender discrimination in credit.
In the 1980s, with entrepreneurship again becoming heralded as an American virtue, women in business got more and more attention. Magazine articles doted on celebrity entrepreneurs like Martha Stewart, Debbi Fields, Josie Natori, and Oprah Winfrey. By the 1990s, the female entrepreneur had become an accepted part of the socioeconomic landscape, and in 1998 the former head of the Small Business Administration, Aida Alvarez (a woman), boasted that the agency’s loans to women had tripled in five years to reach a value of $7 billion. Since then, the figure has reached $13.8 billion. During the decade, twenty-something woman business owners became media darlings when the Internet helped level the economic playing field for would-be entrepreneurs who had limited access to start-up money. But the final proof that the female entrepreneur was now a major presence came at mid-decade, when lenders like the Bank of America began unveiling advertising campaigns that specifically targeted her.
Women business owners are here to stay. The Small Business Administration predicts that there will be 4.7 million self-employed women by 2005, up 77 percent since 1983, while the number of self-employed men will have increased by only 6 percent. Behind this triumph, though, remain unresolved issues in corporate America, such as the lack of on-the-job daycare and the persistence of the glass ceiling, which have often spurred women’s shift to entrepreneurship. The question for the next generation of women entrepreneurs is whether they will provide new solutions to these problems and get national leaders to come up with policies that help ease the difficulties of balancing work and family.