Opinion 1: SBA Works To Level Playing Field For Women
By Steve Preston
Special to the Worcester Business Journal
Since then there have been numerous studies, including an independent study by the respected RAND Corp., which found that WOSBs were underrepresented in four contracting categories.
New Rules
Two weeks ago, based upon the RAND study, statutory law and constitutional precedent, SBA issued a proposed set-aside rule for women-owned small businesses. Our responsibility was to implement the statute in a constitutional manner, and that is what we've done.
Some critics have not been satisfied, pointing out that women are 52 percent of the population and own 28 percent of American businesses, yet in 2006 - the last year for which we have data - they received only 3.4 percent of federal contract dollars.
However, it is important to recognize this is an apples-to-oranges comparison. Women-owned businesses may be more than one-fourth of all businesses, but their gross receipts were only 4.2 percent of the economy, according to census data, because of the inclusion of large companies, many of which are led by women.
The census also indicates that women-owned businesses with fewer than 500 employees make up 3.4 percent of the economy. For the SBA rule, the pool was confined to the nearly 56,000 women-owned small businesses that were registered federal contractors at the time. The data in fact reveal positive news for women: When WOSBs compete for contracts, they do well.
Federal agencies are working hard to reach the 5 percent WOSB target, but how do we get there the right way? We need to understand that the data do not show significant under-representation in the contracting arena, but rather, that too few qualified women-owned small businesses are choosing to enter that arena.
A broad set-aside would be advantageous to women-owned small businesses already pursuing contracts, but again, the data indicate that as a group they're already doing comparatively well.
The better way to increase women-owned small businesses' share of federal contracts is to get more such firms "ready, will-ing and able" to perform federal contracts, and ensure they are registered in the Central Con-tractor Registra-tion system.
Currently, there are some 63,000 women-owned small businesses in the registration system, receiving 3.4 percent of contracting dollars. It stands to reason that if we can get more ready, willing and able WOSBs into the system, we can increase their share of federal contracting dollars.
On this, SBA has taken several steps. Agency field staff is focused on contracting to businesses owned by targeted groups, including women. We recently instituted a government-wide scorecard of federal agencies to rate their small business contracting efforts. And, on a smaller but still significant level.
in 2007 SBA women-owned business procurements exceeded the government-wide statutory goal of 5 percent, reaching 24.7 percent.
Steve Preston is administrator of the U.S. Small Business Administration.
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