Industry News – February 23, 2024

Survey Reveals the Landscape of Black-Owned Businesses in the U.S.

The September 2023 Pew Research Center survey reveals that over 20% of Black adults in the United States consider business ownership crucial for financial success. Despite significant growth in Black-owned businesses in recent years, accounting for a 43% increase in gross revenue from 2017 to 2021, they still constitute only 3% of classifiable U.S. firms and contribute merely 1% to gross revenue. The majority of Black-owned businesses, totaling 161,031 in 2021, tend to be smaller, employing fewer than 10 workers. The health care and social assistance sector is the most common among Black-owned businesses, representing 28% of the total. Geographically, 87% of Black-owned businesses are situated in urban areas, with states like Florida, California, and Georgia having the highest numbers. Demographically, Black business owners are more likely to be men, typically middle-aged, and a majority have at least a college degree. The primary motivations for Black entrepreneurs include the desire for greater income, independence, and a platform for their ideas, goods, and services.

Source: Pew Research Center

 

SBA Administrator Introduces Updated Equity Action Plan for Small Businesses

U.S. Small Business Administration (SBA) Administrator Isabel Casillas Guzman has unveiled an updated Equity Action Plan aimed at fostering inclusivity and economic opportunity for America’s 33 million small businesses and startups, particularly those from underserved communities. The plan, aligned with President Biden’s Executive Order on equity, focuses on improving access to capital, enhancing entrepreneurial support services, and broadening economic opportunities. Strategic enhancements include introducing new lenders for underserved markets, simplifying lending rules, advocating for Small Disadvantaged Businesses’ access to federal contracts, modernizing disaster assistance processes, and implementing rules to diversify fund managers within the Small Business Investment Company Program. The plan builds on previous successes and emphasizes community engagement, reflecting the SBA’s commitment to creating a more equitable economic landscape.

Source: Small Business Trends

 

Major Corporations Cut DEI Jobs Amidst Legal and Political Challenges

In the aftermath of George Floyd’s murder in 2020, companies made significant commitments to racial equity, establishing dedicated diversity, equity, and inclusion (DEI) teams. However, recent data from Revelio Labs reveals a reversal in this trend, with DEI jobs in the U.S. experiencing a 5% decline in 2023 and an additional 8% reduction in 2024. Major corporations, including Zoom, Snap, Meta, Tesla, DoorDash, Lyft, Home Depot, Wayfair, and X, have made substantial cuts to their DEI teams, some by 50% or more. The attrition rate for DEI roles is twice that of non-DEI jobs. This shift coincides with increased legal risk and political challenges to systemic efforts promoting racial equity, as conservative activists target companies with legal complaints and anti-DEI bills gain traction in state legislatures. Despite the setbacks, some companies, such as J.M. Smucker, Victoria’s Secret, Michaels, Moderna, Prudential, ConocoPhillips, Conagra Brands, and NASA, have expanded their DEI teams, emphasizing the ongoing complexity and importance of DEI efforts in the corporate landscape.

Source: The Washington Post