Monday, June 21, 2021

The Racial Wealth Gap and Supporting Black-Owned Businesses

    Earlier this year, a reader suggested we share an "article with links to more than 150 Black-owned businesses" and pointed out that - 

"The events of last summer (BLM protests and COVID-19) saw many people rally to support Black-owned businesses. Sadly, since summer ended, people forgot to keep sharing and supporting these businesses."

    I appreciated Emma sharing this. Last March, ProPublica published an article about "How the Pandemic Economy Could Wipe Out a Generation of Black-Owned Businesses" by Lydia DePillis, which points out the real and ongoing impacts of racial and economic injustice on Black entrepeneurs.

For example, 

  • "There are disparities between American businesses owned by white people and those owned by all minority groups, but the widest ones are typically with Black entrepreneurs, who tend to have modest family wealth and thin professional networks to help recruit talent and cut deals." 
  • "Although the number of Black-owned businesses has grown in recent years, the vast majority remain sole proprietorships. As of 2012 — the most recent data the Census Bureau has collected — average annual sales for a Black-owned business came to about $58,000, compared to nearly 10 times that amount for the average white-owned enterprise."
  • The pandemic has made these disparities worse. "For example, 18.4% fewer self-employed Black people were working in July 2020 than there had been a year previously, compared to 6.2% fewer self-employed white people (the dips for Asian and Hispanic people were even smaller)."
  • Further, "minority-owned businesses overall have also been at the back of the line for relief programs, which were initially designed without factoring in the unique challenges of small businesses owned by people of color. As a result, federal Paycheck Protection Program loans to businesses in areas with a higher percentage of minority residents came in later and in lesser amounts per employee."

    These disparities did not arise out of nothing; they were not random. When we encourage one another to support Black-owned businesses, we are part of the ongoing process of engaging with and undoing centuries of injustice. As Trymaine Lee, writing for The New York Times Magazine, put it - 

"Today’s racial wealth gap is perhaps the most glaring legacy of American slavery and the violent economic dispossession that followed." 

    And calling it "violent economic dispossession" is not a hyperbole. For example, this year is the 100th anniversary of when White mobs brutally destroyed homes, businesses, and lives of the Black community in Tulsa, Oklahoma. Fortune ran an article that profiled how Black entrepreneurs have continued to find ways to survive and thrive, while also honestly pointing out that - 

"What happened in Tulsa set a standard for the erasure of Black wealth and humanity that, over time, has become business as usual: redlining, gentrification, underserved communities filled with undervalued homes, and lack of access to capital markets and venture investment. It was a victory for white supremacy."

    Supporting Black-owned businesses is one of the ways we can work together to resist and reverse that erasure. As Larry Morrow, an entrepreneur and restaurateur in New Orleans, told Forbes

“It needs to become less of a trend and more of a movement to where people are constantly supporting and bridging that wealth gap ... If we offer that same support daily, I think that the economic cycle could constantly be something within the Black community.”

    The potential for change is especially powerful if we can link these choices to advocating for and implementing policy and structural change. As Gene Dimby pointed out for NPR,

"there should be more investment in Black institutions and businesses. But maybe we should also be asking, is buying things, buying stuff, the most effective way to create or even redistribute wealth? I mean, the vast wealth gap between white people and Black people is the result of centuries of racist public policy. It wasn't created by consumer spending. And so fixing this deep-seated problem is also a question of policy, not pocketbooks."

    In other words, please support Black-owned businesses, but don't stop there. Link your buying choices to a larger economic and racial, such as the one outlined by the Movement for Black Lives, oriented around this basic demand:  

"We demand economic justice for all and a reconstruction of the economy to ensure Black communities have collective ownership, not merely access." 
 If you need resources to begin or expand your support of Black-owned businesses, visit:

And for our local area: 
  • "Support Southwest Missouri Black-Owned Businesses" by Jenna deJong and Morgan Doyle provides some starting points to "help amplify minority voices in 417-land by supporting black-owned businesses. 
  • All Things Black Springfield MO was created by Duan and Michelle Gavel to highlight and connect people with black-owned businesses in Springfield. 
  • And a locally crowd-sourced list for the greater Springfield area is also available HERE