ABSA SME INDEX Q2 2013

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1 ABSA SME INDEX Q Theme: Women in Business October 2013 Source: Economists.co.za

2 Highlights Stronger employer performance boosts SME activity in South Africa Absa SME Index rises to highest level in four years Employer numbers increased 6% YOY Self-employment slightly down from first quarter of 2013

3 The Index

4 SME activity up on the back of stronger employer performance. The ABSA SME index is up to its highest level in four years as the number of employers increased while there was a small decline in the number of self-employed. The index reached 96,1 still 5 points below its high in the first quarter of However the index is now up 7,3% from its low in April Much of the growth seems to be driven by smaller companies as the average number of employees remained steady at 11,5 people per firm. (Excluding the selfemployed.)

5 Self-Employment sees slight decline Self-Employment declined slightly from the four year record high of the first quarter. However self-employment remained above one and a quarter million for the third straight quarter - the first time in five years that this has occurred. Moreover selfemployment is up 4,5% since its low in the 2nd quarter of The world s great recession has certainly now blown off most of it negative effects on selfemployment. Self-employment is however still 2,5% below its pre-recession highs indicating that some smaller negative effects still linger. The ABSA SME Index estimates that there are thousand self-employed business people in the country in the fourth quarter. It does seem that micro business are not getting the benefit from the growth that the economy is slowly generating.

6 Women In Business

7 Age of women entrepreneurs The typical woman entrepreneur is between 40 and 44 years old in South Africa. Only 6% of Women business owners are over 60 years old compared to 9% of men. Generally Women entrepreneurs are younger than men.

8 Women entrepreneurs Women make up 45% of all people in employment in South Africa. In high income countries women make up about 47% of all employment while in Latin America women make up about 41% of all employment. In other regions there are not always figures, but many countries such as Turkey have figures of around 23%; but some of this can be attributed to culture and religion. In South Africa women make up 36% of all entrepreneurs; while they make up 52% of the total adult population in the country. This is not unusual in the world of work as Women make up about 42% of Entrepreneurs in richer countries but only around 33% in developing countries for which figures are available. As employers, women make up only 21.1% as compared to men

9 Women Entrepreneurs In America 5,5% of all women are employers while 8,3% of men are. In South Africa that figure is unfortunately lower as only 0,9% of all women adults are employers and 3,2% of men are. But in South Africa as in America women show more resilience when it comes to entrepreneurship as many start from a very small base without much in the form of capital. 46% of all the self-employed entrepreneurs are women as they generally have to keep home fires burning.

10 Female Business Owners by Industry 2013 Building installation % Other financial intermediation N.E.C % Manufacturing N.E.C % Wholesale trade on a fee or contract basis % Manufacture of other textiles % Central government activities % Non-specialised retail trade in stores % Retail trade in food, beverages and tobacco in specialised stores % Farming of animals % Building of complete constructions or parts thereof; civil engineering % Hotels, camping sites and other provision of short stay accommodation % Shebeen % Local authority activities % Other land transport % Manufacture of other food products % Advertising % Manufacture of beverages % Other retail trade in new goods in specialised stores % Veterinary activities % Real estate activities with own or leased property % Social work activities % Restaurants, bars and canteens % Activities of business, employers and professional organisations % Manufacture of wearing apparel, except fur apparel % Retail trade not in stores %

11 Women Entrepreneurs The biggest number of women entrepreneurs are in the retail trade not in stores. These women are really the backbone of the informal economy and often have to provide a living for families as overall 57% of all women entrepreneurs make a living outside of metropolitan areas. The second biggest number of female business owners are in the clothing industry followed by economic and professional organisations. (This would include trade unions and business organisations).

12 Tertiary qualified females by study field Public administration or social services 0.1% Physical education or leisure 0.3% Education and development 0.5%. Languages; linguistic or literature 0.5% Engineering 0.5% Home economics 0.7% Office administration 0.8% Civil engineering and building construction 0.8% Agriculture or Renewable natural resources 0.9% Arts; Visual or Performing 1.2% Engineering or engineering technology 1.3% Tourism 1.5% Industrial arts; traders or technology 1.7% Computer science 1.8% Information technology and computer science 2.3% Life sciences or physical sciences 2.3% Electrical infrastructure construction 2.4% Marketing 2.4% Social sciences or social studies 2.5% Management 2.7% Communication 2.7% Architecture or environmental design 4.5% Finance; economics and accounting 4.5% Law 4.5% Psychology 7.2% Education; training or development 13.3% Health care or health sciences 17.8% Business; commerce and management studies 18.4%

13 Educational attainment of Female Business Owners At present only 14% of Women have a tertiary education. While this number is low it is interesting to look at the fields in which female entrepreneurs are working in. About 18% of women with a tertiary education have qualified in a business degree or diploma followed by Health and Education which is also close to 18% and 13% respectively. Healthcare however also include beauty products and services. Further down the table there is also economics, management, accounting and law as fields of study which indicates that South African women are following similar patterns of study that American women are. It seems that when entering tertiary education many women choose a profession or a business type of field in which to study in.