Facebook FB -0.38% is deeply invested in understanding how small and medium sized businesses engage with digital tools, not only because they’re crucial customers, but also because small enterprises provide the majority of jobs globally.
On Tuesday, Facebook unveiled the “2017 Future of Business” survey with the World Bank and the Organization for Economic Cooperation and Development (OECD) to provide monthly data on “the perceptions, challenges and outlook” of online small and medium enterprises. The study spans 33 countries and more than 140,000 small businesses using Facebook Pages. Its goal is to help businesses learn from each other and to encourage them to use technology to further their reach, Facebook said.
This year’s survey builds on an initial report in September based on 17 countries. The survey found that nearly a fifth of small businesses created jobs in the past six month.
“We take our responsibilities seriously as a new kind of platform, and technology needs to provide opportunity that everyone participates in,” Facebook COO Sheryl Sandberg said in a phone interview. “The numbers of jobs that are created through online and Facebook in particular are astounding. We want to help small businesses grow, and we want to help them continue to create jobs.”
“Often when people think about small businesses and Facebook they think of tech-savvy businesses or people building apps,” Sandberg said. Certainly we have some of those, but the majority are non-tech businesses — the plumbers, the bakers, the local florists who are using technology to reach customers and sell their products and services.”
When it comes to international trade, the study found that small businesses that engage in it thrive. And the more ways small businesses use online tools, the more likely they are to engage in international trade. This connection is important, according to the survey, because small businesses that engage in international trade — about 17% of those surveyed — are more confident about the current and near-term outlook of their business compared to non-traders and are more likely to increase jobs in the next six months than non-traders. Now, more than 35% of fans of Pages are cross border, up 5% since 2015. And now a billion people on Facebook are connected to a business in another country.
A boost in international trade is great for the economy, Facebook said, because it correlates with more jobs, economic growth and productivity, especially in emerging markets. The survey participants urged policymakers, companies and other groups to be committed to investing in their digital infrastructure as well as to bringing the world’s 4.3 billion unconnected people online.
“We have a responsibility to connect the world and also understand the implications of a connected world,” Facebook’s Jackman said. “We saw this ability to use our reach and contact small businesses as a way that we could contribute to the data revolution and help policymakers learn about small businesses.”
Regarding gender, the study found that women-led businesses (defined in the study as enterprises having at least 65% female owners or managers) were just as confident as male-led businesses about the present and near-term outlooks of their enterprise. And women-run businesses reported facing the same challenges as those run by men. Currently, women-run firms tend to be smaller and younger than male-run firms. Two-thirds of female-run businesses are sole proprietors, compared to about half of male-run businesses. And 28% of male-run small businesses are more than 10 years old, compared to 18% of female-run small businesses, the study found.
The fact that there are disproportionately fewer female-run businesses in many countries highlights that women face greater barriers to entry than men because globally, women have less access to the education, training and financing required to start a business, the study said. Women-run businesses surveyed were also more likely than male-run businesses to leverage online tools to make their business succeed.
“The digital world and access to Facebook and technology is helping equalize the playing field, and we’re going to keep digging in to understand women-run businesses and businesses with more women in management,” Sandberg said.
One of the reasons Facebook can be uniquely useful to businesses, according to Sandberg, is because of its ability to help businesses foster community among its nearly 2 billion monthly users globally without significant resources.
“Change in the business world comes from companies that have created job growth and from people finding their passion and doing things they believe in and in a way that’s responsible, sustainable and builds communities,” Sandberg said.