A survey released last week by the U. S. Census Bureau showed that the number of minority-owned businesses grew at more than twice the rate of all U.S. businesses between 2002 and 2007 by nearly 46%, with the number of women-owned businesses rising by about 20%.
The Preliminary Estimate of Business Ownership by Gender, Ethnicity, Race and Veteran Status, 2007 survey is taken every five years and closely watched by industry groups, economists and public policy experts.
Despite the recent economic downturn, the number of Hispanic-owned businesses grew by 44% to 2.3 million; the number of black-owned businesses grew 61% to 1.9 million; and the number of Asian-owned businesses grew by 41% to 1.6 million. During this same period, white-owned businesses grew by 14% totaling 22.6 million.
Minority-owned businesses also hired at a faster rate during this five year period. The Census showed that the rate of new hires at minority-owned businesses increased by 27%, compared to 2.3% at white-owned businesses.
“It is expanding the U.S. economy,” said David Hinson, Minority Business Development Agency national director, who participated in a Tuesday morning teleconference to announce the results. “The minority businesses have grown faster than the minority population (and) dramatically outpaced U.S. firms in general.”
In El Paso, Texas, more than half of all businesses are minority-owned with the Hispanic-owned businesses totaling 59.2% says Cindy Ramos-Davidson, chief executive officer of the El Paso Hispanic Chamber of Commerce. Texas overall was in third place nationally in the number of Hispanic-owned businesses, and third in the total number of minority-owned businesses.
Bureau officials also pointed out that minority entrepreneurs face significant challenges in the future. Getting access to the capital they will need for expansion and hiring, and growth in overseas markets remain an issue.
Getting business loans requires knowing how to write a solid business plan says Ramos-Davidson. “It’s a problem of understanding how financing works,” she said. “You have to show them how you’re going to pay back what you borrowed.”
This is very good news but unfortunately the banks out there are practically on lending freezes, hopefully the growth continues!