The fastest-rising demographic in American business? Black women.
The number of businesses owned by African-American women grew by more than 300 percent in the last two decades, a new report has found.
A new report is showing that black women mean business – literally.
Since 1997, the number of companies owned by African-American females shot up by 322 percent, far outpacing the growth rate of women owned-businesses in general and making black women the fastest-growing group of entrepreneurs in the US today, according to the 2015 State of Women-Owned Businesses Report, commissioned by American Express Open.
The figure reveals the next big step in the struggle for gender equality, observers say. It also represents a nationwide power shift that experts say has been going on for the last 50 years.
“We attribute the growth in women-owned firms to the lack of fair pay, fair promotion, and family-friendly policies found in corporate America,” Margot Dorfman, CEO of the US Women’s Chamber of Commerce, told Fortune magazine.
“Women of color, when you look at the statistics, are impacted more significantly by all of the negative factors that women face,” she added. “It’s not surprising that they have chosen to invest in themselves.”
The result: Women now own 30 percent of all businesses in the US, or about 9.4 million companies, having grown by 74 percent since 1997. Together these firms generate about $1.5 trillion in revenue and employ nearly 8 million people, the report found.
African-American women own about 14 percent of those firms, accounting for 1.3 million businesses, or half of all businesses owned by African-Americans in the country. Latina women follow close behind them, comprising 12 percent of all women-owned firms, or about 1 million businesses.
Some see these figures as indicative of the next step in the struggle for equal rights.
“Hispanic and African-American women will play vital roles in the final frontier of the women’s empowerment movement: entrepreneurialism and economic freedom,” Natalie Madeira Cofield, CEO of the Greater Austin Black Chamber of Commerce, wrote for Forbes in 2013.
The change has also been good for the national economy.
“The only bright spot in recent years with respect to privately-held company job growth has been among women-owned firms,” the report reads. “They have added an estimated 340,000 jobs since 2007,” while employment at male-owned or equal-share companies have declined over the last eight years.
For the most part, similar trends have proven just as true historically, some experts say.
“In 1960, 94 percent of doctors and lawyers were white men,” economists with the National Bureau of Economic Research wrote in a paper published in 2013. “By 2008, the fraction was just 62 percent” – a change that improved the “allocation of talent” and resulted in up to 20 percent of increased productivity nationwide, they wrote.
Still, those at the forefront of the struggle for gender and economic equality continue to push for more improvement, especially for women of color who are single parents and with few social or financial supports.
Organizations such as the Build Institute, based in Detroit, teach black and minority women business and money-management skills, while networks such as Black Business Women Online seek to connect women in the industry, help them share tips about running a firm, and promote their businesses.
These and others are crucial to improving minority women’s share in the economy and the business world, according to Ms. Cofield.
“For women of color, increased participation with women’s associations, collectives and trade groups can greatly increase cross-cultural social capital, and relationships,” she wrote.