Detroit tops in women-owned businesses

(A version of this article was published in the Detroit Free Press on August 31, 2014)

Stop by a recent start-up event in Detroit’s Techtown and you’d be forgiven an assumption that Detroit’s economic future is very male and quite white. But don’t be too quick to jump to conclusions: Numbers and stories across Detroit’s neighborhoods tell a very different story.

Just months after her decade-old job at Ford came to an end six years ago, 38-year-old Detroiter Rachel Leggs opened up her own business, Rachel’s Place, a vintage clothes store full of exquisite designer finds in Detroit’s Corktown area. Business is good, she says. Every day is busy.

Rachel Leggs owns a vintage clothing store in Detroit's Corktown neighborhood. She worked in the auto industry until being laid off, and then decided to make a go at starting her own business, becoming part of a growing trend of female business owners in the city. / 2010 photo by REGINA H. BOONE/Detroit Free Press (used with permission)

Rachel Leggs owns a vintage clothing store in Corktown. She worked in the auto industry until being laid off, and then decided to launch her own business. / 2010 photo by REGINA H. BOONE/Detroit Free Press (used with permission)

Helping her as she started out were a tight community of family and friends, she says. Leggs took little notice as to whether banks were lending. The money to open the store came from her own pocket, the product of years of saving.

“If there were grants to be had, I didn’t know of them.”

Leggs’ story is no exception. To little fanfare, over the last fifteen years, women have been setting up their own businesses in the thousands, government data shows, making the rate of women-owned businesses in Detroit the highest among large cities in the nation.

Every other business in Detroit is owned by a woman, an anomaly in a nation where just 29% of businesses overall are women-owned, and in a state where the figure is just 30%.

Christopher Prater is a native Detroiter who c0-owns newly-opened Thrift On The Avenue with his wife, Tanisha. Their shop is a carefully curated second-hand clothes store on Cass Avenue.

Prater was initially taken aback when informed about the high rate of women-owned businesses. As he thought about it, though, he began enumerating the dozen or so business owners surrounding their shop at the intersection of Cass and Willis Street. A vast majority of the names were female.

The growth in women-owned businesses is a relatively recent phenomenon.

In 1997, 31% of Detroit firms were registered under a woman’s name. A decade later that figure had jumped to 50%. And while 2012 data is only set for release in June 2015 – meaning an accurate up-to-date analysis is difficult – anecdotal evidence in Detroit suggests the trend is still growing.

What’s more, in 1997, when Detroit’s population was close to 1 million, official data recorded just 26,085 businesses in operation in the city. By 2007, that number had almost doubled to 50,588, even as the city’s population was steadily declining to 700,000 and below.

The boom in businesses was not only accompanied by population decrease, it also unfolded at a time in Detroit’s history when job losses became brutal. This may indicate that some people –especially women and minorities previously underrepresented among business-owners — decided to open their businesses rather than seek work in a turned to opening their own businesses when the job market was no longer providing them with opportunities for making a living.

Between 2000 and 2010, Michigan lost around 850,000 jobs, according to the Michigan Turnaround Plan – almost half of the overall 2 million jobs lost across the United States during the same period.

While Sarah Swider, an assistant professor in sociology at Wayne State University, is among those warning against taking this figure too literally – because of the number of residents who may have then left the state or found new jobs – Michigan undeniably lost devastating amounts of jobs over that decade, especially in the manufacturing industry.

In Detroit, tales of women losing their factory jobs and using buy-out money towards setting up their own businesses abound.

But the leap hasn’t just been among women. Minority-owned businesses also went up between 1997 and 2007, from representing 47% of firms in 1997 to 70% in 2007.

To Shirley Stancato, president and CEO of New Detroit, women and members of the black community are natural entrepreneurs, accustomed to discrimination, or “glass ceilings” in the workplace that push them out of traditional employer-employee environments to set up on their own terms. (Stancato is a co-founder of

This is also true in the immigrant community, says Myrna Segura, director of business district development at the Southwest Detroit Business Association.

“Setting up a business is not a challenge for immigrants, but it is natural to them. Owning a business is a solution. They expect to otherwise be excluded from the workforce.”

Segura says a current challenge within the immigrant female population is for women who have home-owned informal businesses to take the next step towards becoming formal business-owners, implying the ratio of women-owned businesses could actually grow.

Carolyn Cassin, President and CEO of the Michigan Women’s Foundation, agrees the potential for even more women-owned businesses in Detroit is immense.

A new initiative by the foundation to give aspiring Detroit women microloans to set up their own businesses has already exceeded attendance expectations, she says, with initial events having a turnout five times what her staff and she had expected. Cassin hopes to help set up 1,000 new Detroit female-owned businesses in the next five years.

“There is no doubt we have tapped into a need.”

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