Black women make significant gains as entrepreneurs
Black women are often in the news for statistics that are negative, these numbers reflecting health care, education, and other disparities that disproportionately impact this segment. By contrast, a new study from the Center for American Progress, The State of Women of Color in the United States, illustrates the significant gains African-American women have made in the realm of business ownership.
Black-owned businesses make up the fastest-growing segment of women-owned businesses in America, according to the report. Plus, black women are starting businesses at a rate that is six-times that of the general population.
“Half of all African-American-owned businesses are owned by women, and among businesses owned by women of color, 42 percent are owned by African-American women,” wrote Farah Ahmad of the Center for American Progress. “Businesses owned by African-American women have doubled their sales over the past decade and just this year have grossed revenues estimated to be around $45 billion. These successes have benefited not just African-American women and their families but also their communities and the U.S. economy as a whole.”
The need for greater opportunities
Ahmad points to these types of gains as crucial to developing economic opportunities for women of color, who will make up the majority of all American women in the coming years, but are lagging among personal financial security indicators. These factors include job training, educational attainment, and levels of family wealth.
Yet, 53.3 percent of wives are the breadwinners among married black households, meaning that the growth of black woman-owned businesses may be crucial to the fiscal well-being of the black community overall.
In addition, starting their own companies is a means for black women to avoid the barriers of the corporate world that prevent advancement.
“Women of color haven’t had as much access to mobility in the corporate world,” Ahmad stated in a story on this trend for the Indianapolis Recorder. “Even though there’s this sense that diversity is important you just haven’t seen it reflected. There’s this urge for businesswomen of color to start their own businesses and have professional and career success in that way.”
Despite growth, inequalities remain
For black women, these gains in ownership do not reflect parity in terms of earnings and the ability to hire that other entrepreneurs enjoy. The vast majority of firms owned by black women are sole proprietorships with less revenue on average than other women-owned businesses, or even companies owned by black men.
For reasons such as these, the goal of The State of Women of Color in the United States is both to document the gains of women of color and outline possible solutions to the social issues that continue to plague this group, particularly in the realms of health care access and monetary challenges.
Improving circumstances for black women and other women of color starting businesses is key to addressing these issues.
“Eliminating the gaps between African-American women and others is an opportunity to improve the lives of these women and their families, but it is so much more,” Ahmad stated.”It is an opportunity to strengthen our workforce and purchasing power—and that’s good for the economy, which means that it’s good for everybody. But it will happen only if we choose to seize it.
Follow Alexis Garrett Stodghill on Twitter @lexisb