Supporting Black businesses build relationships and boosts community morale. There are currently 2.6 million Black-owned businesses in America, where 8 out of 10 fail within their first 18 months due to the lack of resources and funds. The persistent racial wealth gap in the United States is a burden on Black Americans as well as the overall economy. It can be traced back to the Jim Crow era and redlining that prevented Black people from accessing higher-paying jobs and homeownership opportunities.
Black business owners continue to face a disproportionate number of challenges, namely a lack of access to capital, and these obstacles have only been exacerbated by the COVID-19 pandemic. From my conversations with small business owners, I am well aware of the unique hardships small businesses are facing across the country, and the acute impact to Black-owned businesses has been especially troubling.
The number of active Black-owned businesses fell 41% between February and April 2021. There’s a common saying, “It takes a village to raise a child.” The power of the community has paved the way for many business owners. When you choose to support Black-owned businesses, you’re supporting Black pride, unity and self-determination. While that may be intimidating to some, it would mean the world to many families and communities. Black entrepreneurship is a tool for survival in a world that does not want to see you win.
When Black-owned businesses are in high demand, the companies become more profitable. Supporting these businesses contributes to creating entrepreneurial opportunities. Entrepreneurship fuels economic prosperity and serves as a bridge for low-income families to move up to middle-class status. This in turn will give greater buying power and influence to these families, which will enable them to support more local and international Black-owned businesses and contribute to more job creation. The infusion of technology into business operations has made it necessary for even the smallest business team to understand basic technology. It also has made it possible for even the smallest of business teams to scale larger and have as big an operational impact as a corporate entity on the internet. Understanding this evolution is key for developing solutions to the economic gaps that exist now.
The disparities that make it disproportionately difficult for Black entrepreneurs to pursue business ownership are depriving our country of new businesses, innovation, jobs and income. A report from the Center for Global Policy Solutions estimates that past and present racial disparities in the U.S. preclude the existence of more than 1 million minority-owned (of that, 500,000 Black-owned) businesses, 9 million jobs, and $300 billion in national income.
Supporting Black-owned businesses with our consumer spending habits will help alleviate the need for additional loans or dipping into personal savings. Promoting the success of Black-owned businesses will also help tackle some of the biases preventing Black entrepreneurs from obtaining equal access to business loans. Also, never forget the power of social media, by amplifying Black voices and products in your own channels, you can bring attention to these creators and businesses.
Devon Davis is a public policy specialist at Bose Public Affairs Group. Contact him at firstname.lastname@example.org.