Entrepreneurship Policies through a Gender Lens

Sweden

By Helene Ahl, Jönköping University

This policy insight note was drafted by an independent researcher and does not necessarily reflect the official views of the OECD or the Government of Sweden.

Background

Sweden has benefitted from dedicated policy support for entrepreneurship and business development since the establishment of the Regional Development Funds in the late 1970s. The initial policy objective was to stimulate business development in locations where industrial restructuring resulted in job losses. In 1994, the Regional Development Funds were replaced by ALMI Företagspartner AB, a fully state-owned corporation with a mandate to provide business counselling and start-up loans. In addition, Local Enterprise Agencies were established in 1985 to stimulate business creation (Ahl and Nelson, 2015). In 2009, approximately SEK 42.5 billion was made available in both direct and indirect business development support, including tax relief and loan programmes (Growth Analysis, 2011). However, ostensibly gender-neutral rules and regulations for accessing support often placed women entrepreneurs at a disadvantage. There are differences in terms of industry, size and markets between businesses owned by women versus men. Women are, for example, more likely to have a small business with a local market, and often in a service-based industry (Tillväxtverket, 2012), whilst many forms of support are tailored to manufacturing firms or the export industry. An evaluation in 2007 showed that a disproportionate share of support monies went to businesses owned by men (Nutek, 2007).

The first programme dedicated specifically to supporting women’s entrepreneurship involved women business advisors in economically disadvantaged areas. The programme was established in 1992 and discontinued in 2002, when it was largely integrated into ALMI’s mainstream advisory system. A study of this programme found that tailored advice and counselling for women entrepreneurs was “side ordered” and viewed as less legitimate by the business development support staff (Nilsson, 1997). In addition, the Regional Resource Centres for women that were established in 1994 were discontinued in 1999, after which many of the centres continued as local or regional independent non-profit organisations. By 2019, the majority of these local associations were discontinued.

In 2007, the liberal/conservative government coalition initiated a new initiative (Promoting Women’s Entrepreneurship), which continued until 2015. The programme was well-funded and focused solely on promoting economic growth, i.e. more women-owned businesses and more new jobs; gender equality was the means rather than the end (Ahl et al., 2016). The programme provided: specialised business training services and development projects for women; trained support staff in gender awareness; enterprise activities for prospective women entrepreneurs at universities; communication about networks for women business owners, and an unpaid ambassador initiative whereby women entrepreneurs were asked to volunteer as role models inspiring schoolgirls to pursue entrepreneurship as a career. An annual “Beautiful Business Award” competition was also launched (Berglund et al., 2018). A programme evaluation on 2 397 participating firms found a positive effect on growth and short term employment, but not on long-term employment or survival (Tillväxtverket, 2018).

Policy issue: Privatisation of public welfare delivery has not helped women entrepreneurs

In 2015, all programmes for women entrepreneurs were discontinued. The new National Strategy for Business Promotion on Equal Terms (Open Up) focused on diversity, not for the sake of diversity itself, but for the overall goal of economic growth. The strategy explicitly states that Sweden needs more entrepreneurs who are women, ethnic minorities, young and seniors to secure economic growth; the point of achieving equal access to business ownership is thus economic growth; equality is not an aim by itself (SAERG, 2015, pp. 44-45). However, targeted funds were not dedicated to any of these groups – it was essentially a gender mainstreaming strategy.

In parallel to these developments, Sweden has undergone the marketization and privatisation of its public sector. Many public sector operations have been opened for private sector competition through the use of public procurement and voucher systems. While the services are still funded by public funds, they are free or almost free to the consumer. This has created quasi-markets in the school and health-care sectors, with privately-owned but publicly funded businesses. These are sectors dominated by women in employment terms. The government propositions preceding many of the women’s entrepreneurship programmes that operated over the period 1992-2015 included arguments that women who used to be employed by the public sector should avail themselves of these new business opportunities and thus create jobs for themselves and others (Ahl et al., 2016). Marketization of the public sector and support for women’s entrepreneurship thus worked in tandem.

The outcomes of the policies described above are sobering. The increase in women-owned businesses did not change gendered segregation by industry, nor did it improve women’s financial situation. The share of women-owned businesses increased from 32% in 2009 to 38% in 2016, but the gendered employment and business landscape remained, with women concentrated in occupations such as social work, personal and cultural services, and education (SCB, 2018). The privatisation efforts resulted in more women-owned businesses, but even more men-owned businesses. In sectors such as hospital care, secondary schools and nursing homes the result was the creation of a small number of large new businesses that succeeded by leveraging their economies of scale (Sköld, 2015). A recent study on Swedish registered data found that the median disposable income of women entrepreneurs in Sweden was lower than that of women employees, who in turn made less money than men (Sköld et al., 2018). Remunerations from the welfare system (such as sick leave pay, parental leave pay, or unemployment insurance) follow suit, since these are tied to taxable employment income. Thus, replacing a welfare system delivered by the public sector with private business ownership did not improve women’s financial situation.

Conclusions and recommendations

Neither privatisation nor marketization, nor programmes tailored for women’s entrepreneurship have managed to challenge the gendered business landscape. Women’s businesses are still largely concentrated in feminine gendered sectors with low earning potential, so having a regular job may actually pay better than owning a business. For future policy to benefit women entrepreneurs, and be an instrument for increased gender equality in entrepreneurship, there is a need not only to continue a gender mainstreaming policy, but also to consider the gendered division of occupations, the gendered differences in pay or profitability between different sectors, and how privatisations of public sector welfare responsibilities impact women.

Recommendations for Sweden

• Mainstream policy support for women’s entrepreneurship, i.e. integrate a gender perspective into all steps of policies and programmes affecting business development.

• Reduce bias against women entrepreneurs by changing the eligibility criteria for general business support in terms of, for example, supported markets or industries. Current criteria favour industries and markets where most business owners are men.

• Change the criteria for selecting enterprises in public procurement processes. Current criteria disfavour small-scale businesses typically owned by women.

References

Ahl, H., K. Berglund, K. Pettersson and M. Tillmar (2016), “From feminism to FemInc.ism: On the uneasy relationship between feminism, entrepreneurship and the Nordic welfare state,” International Entrepreneurship and Management Journal, Vol. 12, No. 2, pp. 369-392.

Ahl, H. and T. Nelson (2015), “How policy positions women entrepreneurs: A comparative analysis of state discourse in Sweden and the United States,” Journal of Business Venturing, Vol. 30, No. 2, pp. 273-291.

Berglund, K., H. Ahl, K. Pettersson and M. Tillmar (2018), “Women's entrepreneurship, neoliberalism and economic justice in the postfeminist era: A discourse analysis of policy change in Sweden,” Gender, Work & Organization, doi.org/10.1111/gwao.12269.

Growth Analysis (2011), “Entrepreneurship and SME policies across Europe: the Swedish concluding report”, Swedish Agency for Growth Policy Analysis, Östersund.

Nilsson, P. (1997), “Business counselling services directed towards female entrepreneurs - some legitimacy dilemmas”, Entrepreneurship and Regional Development, Vol. 9, No. 3, pp. 239-258.

NUTEK 2007. “Utfall och styrning av statliga insatser för kapitalförsörjning ur ett könsperspektiv“ [Outcome and governance of state support for capital provision from a gender perspective]. Stockholm: Nutek.

SAERG (2015), “Open up! National Strategy for Business Promotion on Equal Terms 2015–2020”, Info 0606, Tillväxtverket, Stockholm.

SCB (2018), “Women and men in Sweden. Facts and figures 2018”, Statistics Sweden, Örebro.

Sköld, B. (2015), Vad hände? Kvinnors företagande och de strukturella villkoren - en studie i spåren av den offentliga sektorns omvandling, Linköping University, Linköping.

Sköld, B., M. Tillmar, H. Ahl, K. Berglund and K. Pettersson (2018), Kvinnors företagande i landsbygdskommuner med fokus på Småland och Öland: En kvantitativ kartläggning inom ramen för forskningsprojektet ”Kvinnors företagande för en levande landsbygd”, Linköping University, Linköping.

Tillväxtanalys (2018). ”Främja kvinnors företagande – resultat av affärsutvecklings- och innovationsinsatser”. PM 2018:21. Swedish Agency for Growth Policy Analysis, Östersund.

Tillväxtverket, (2012), “Women’ and men’s enterprise in Sweden – The Situation and Conditions of Enterprises 2012”, Tillväxtverket, Stockholm.