Economic optimism is on the rise among diverse-owned small business owners, with Black-owned small businesses having greater confidence in the local, national and global economic outlook than survey responses overall.
More than 60% of Black small business owners expressed optimism about the state of the local, national and global economy. Close to 80% had the same optimism about their industry’s performance or their own company’s performance.
Despite some apprehensions about a potential recession and recruitment challenges, diverse-owned businesses are determined to expand their workforce and secure funding to fuel growth. This determination underscores their optimism for 2025 and their readiness to make strategic moves to scale their operations.
While small businesses seem to have left the economic uncertainty of the pandemic years behind, diverse-owned businesses remain more cautious about the future. Interestingly, they are still more likely to anticipate a recession in 2025 compared to the broader business community. However, less than a third of diverse-owned businesses expect an economic downturn – among Black-owned small businesses, 29% said “yes” to expectations of a recession in 2025. This cautious optimism reflects a nuanced perspective, balancing resilience with a watchful eye on potential economic shifts.
- Inflation Is Top Concern, But Cybersecurity Challenges Are Growing
As inflation remains the top challenge for business owners going into 2025, Black business owners are particularly attuned to the threat of cybersecurity, identifying it as their second-biggest challenge. This concern surpasses the “uncertainty of economic conditions,” which ranks second among the broader community. Across all groups, rising taxes emerge as the third most pressing issue. This highlights a distinct focus among diverse business owners on the importance of protecting their operations from any threats.
- Finding funding
Diverse-owned businesses are strategically positioning themselves to tap into a variety of funding sources more than small business overall. Black-owned businesses, for instance, are notably inclined to utilize lines of credit (48%), online loans from fintech or alternative online lenders (39%), personal credit cards (39%), angel investments/venture capital (25%) and crowdfunding (19%). A significant majority of Black-owned businesses (73%) are also more likely than the overall business respondents (55%) to explore online lending this year.
- Ambitious Hiring Plans Amid Talent Challenges
Diverse-owned businesses are setting ambitious hiring goals for 2025. Black-owned businesses are planning for substantial increases, with 71% anticipating more full-time hires and 55% expecting part-time hires. This contrasts with 46% of all respondents expecting full-time hiring increases and just 38% planning for part-time hires.
