Black-Owned Business are Thriving More Than Ever Because of Black Women
Should we be surprised? Black women have been carrying Black-owned businesses since the beginning of the coronavirus pandemic.
According to Insider, a report from Wells Fargo shows that in April 2020, Black-owned businesses decreased by 40%, more than any other ethnic group. Since then, Black-owned businesses are now 30% above what they were before the pandemic and Black women have been the driving force.
In recent months, there have been notable cases of Black women’s businesses thriving despite the struggles of the coronavirus and the data reflects that.
From Insider:
“At a time when folks are rethinking their lives and choices, it is not surprising that more Black women are electing to become CEOs of their own companies rather than waiting for their intelligence and skills to be recognized at their current firms,” Melissa Bradley, the founder of 1863 Ventures, an agency for Black and brown entrepreneurs, told Insider.
After all, Black women are paid less than any other demographic group and overrepresented in low-paying jobs, so pursuing their own business venture is a way to gain more control over their work lives. Black women’s entrepreneurship gains in particular align with their exodus from the workforce as millions of women have left due to a lack of childcare, adequate pay, or remote options, as well as a reluctance to expose themselves to the coronavirus.
“The potential return of the freedom of time, lack of unnecessary controls and financial success far outweighs the risk of failure for these Black female entrepreneurs when leaving their full-time jobs,” Bradley said.
The coronavirus pandemic ruined many things, including the impressive efforts that Black-owned businesses made in the country before the shutdown.
According to Insider, the Wells Fargo report says in 2019 35% of Black-owned businesses were owned by women, 10% more than the share of women-owned businesses overall in the country.
But like many things, the coronavirus exposed how many Black-owned businesses rely on in-person interactions after businesses were forced to close for safety. The government aid program that was meant to assist small businesses, the Paycheck Protection Program, only reached 29% of Black-owned businesses applicants, compared to 60% of white businesses.
But that’s not where the disparities end. Black people on average have less wealth than white people and as a result, have less collateral if there is a financial emergency. It was found that the financial condition of 77% of Black-owned businesses was fair or poor, according to Insider.
But despite that, Black businesses still had a resurgence.
More from Insider:
Despite those hardships, 2020 eventually saw more new Black-owned businesses formed in proportion to the total population than at any time in the last 25 years, according to the Kauffman Foundation’s annual analysis of Census data.
Black workers, along with Hispanic and Asian-American ones, are more likely to get paid poverty-level wages than their white counterparts, according to a 2018 report by the Economic Policy Institute. Women of color in low-wage jobs are also more likely to experience workplace harassment. It isn’t a big leap to assume that Black women want to escape these conditions, Jay H. Bryson, Wells Fargo’s Chief Economist, told Insider.
“If you start your own business, some of those obstacles may not be as acute as if you were relying on employment from someone else,” he said. “There may be avenues that certainly benefit anybody, but proportionally they’d be more beneficial to the Black community than other parts of the population.”