What if Black businesses reached parity with non-Black businesses?
There are 124,004 Black businesses, accounting for 2.2% of employer businesses. If Black businesses accounted for 14.2% employer firms (equivalent to the Black population), there would be 806,218 more Black businesses.
Black-owned businesses are much more likely to be sole proprietorships. According to the 2012 SBO (the last year reported), 4.2%of Black-owned businesses had employees, compared to 20.6% of white-owned businesses. Black adults are much more likely to be unemployed, and Black businesses are much more likely to hire Black workers. This shortage of Black businesses throttles employment and the development of Black communities. Furthermore, the underrepresentation of Black businesses is costing the U.S. economy millions of jobs and billions of dollars in unrealized revenues.
Fueling Black business growth is broader than just providing capital. It will require leaders in financial institutions, philanthropy, government, corporations, and investors to align and collaborate towards a clear set of goals that address systemic barriers. From supportive policy to representative leadership, it is critical that we work together to build the economy that reflects America’s promise.
Tynesia Boyea-Robinson President and CEO of CapEQ
It’s been one year since a stay-at-home order was announced across the Bay Area and the rollercoaster of closings and reopenings has been tough for business owners, to say the least.
Black business owners have felt the highs and lows but more help is on the way.
“We have been pushing trying to keep things as normal as possible,” Cathy Adams said.
Cathy Adams is the president of the Oakland African American Chamber of Commerce.
Black businesses bring in average revenues of $1,031,021, compared to $6,485,334 for non-Black businesses. If Black businesses increased their average revenue to the level of non-Black businesses, it would increase total revenue in Black businesses by $676,356,621,618.
If the number of Black businesses matched the population size and the employees per firm matched non-Black businesses, it would create more than 19 million jobs (19,732,593). Nationwide, 40% of Black businesses have closed over the last year, even still, Adams has chosen to stay positive and take action.
She was a part of a large conversation with Vice President Kamala Harris last month and out of that chat came extra PPP assistance to businesses with only one employee, previously, that type of federal help was not being offered.
During the summer of 2020, the chamber was able to raise one point $1-million in grant money that was given to more than 200 businesses.
She’s hoping to raise another million dollars this year.
“The community showed up. We work with the multicultural chambers of commerce. We’ve been utilizing our resources, they support our businesses, we support theirs and I think it’s working, we just all gotta pull together,” Adams said.
Adams believes the future is bright for Black-owned businesses but she is calling on all owners to reach out to the chamber if they need assistance.
“We may not know where you are. We have a pulse on our 300+ businesses but if there’s others out there, you gotta reach out and make phone calls and you’ve gotta ask for help,” Adams said.
