Business ownership: Race and gender should not be a barrier to owning a business. 

Insights & Analyses

  • The number of firms held by people of color per 100 workers increased from 12 to 14 from 2007 to 2012 while the number of White-owned firms per 100 workers decreased from 19 to 18. 

  • Mixed/other-owned firms have grown most among all other racial/ethnic groups in every sector except the educational services sector, where Asian or Pacific Islander-owned businesses have grown the most, and the utilities sector where Mexican-owned firms have grown the most.

  • The number of women-owned businesses and men-owned businesses per 100 workers increased from 2007 to 2012 but there are still five more men-owned businesses than women-owned ones per 100 workers.

  • Cities in Florida, like Miami and Hialeah, have the highest number of both White-owned businesses per 100 workers and people of color-owned businesses per 100 workers.

Drivers of Inequity

People of color are less likely than Whites to have access to capital and contracts to start and grow a business, due in part to historical policies such as redlining that denied home loans and wealth-building opportunities to people of color. Today, business loan denial rates for firms owned by people of color are three times higher than for firms owned by Whites. Business owners of color also pay higher interest rates and receive lower loan and equity investments. Although creditworthiness is a factor in loan denials, this metric does not reflect how reliably individuals pay their rent. Underrepresented groups also often face barriers accessing important networks and training programs.

Strategies

Grow an equitable economy: Policies to ensure equitable entrepreneurship opportunities

Strategy in Action

Atlanta invests in business owners of color. Atlanta’s office of economic development, Invest Atlanta, is launching the Accelerate Southside Program, which is designed to assist businesses owned by people of color in Atlanta’s southside. The program includes a business training component aimed at supporting participants in overcoming barriers frequently faced by business owners of color, such as absence of accessible capital and risk of displacement. The second aspect of the program provides entrepreneurs with down-payment assistance for their business location. The current cohort includes 21 businesses that range in annual revenue from $40,000 to $5 million. Learn more.

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