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New Business Ownership Increases
Released on: Tuesday, December 12, 2006 8:00 AM
Minority and Women-Owned Business Grow At High RateGrowth among minority-owned and women-owned businesses continues to outpace the national average of ten percent growth, according to a recent Census Bureau report. Their final report will be out later this year.
During the 1997-2002 study period, black-owned firms increased 45 percent, Hispanic-owned firms grew 31 percent, Asian-owned companies increased 24 percent and women-owned firms increased by 20 percent. The nation’s 1.2 million black-owned businesses and 1.6 million Hispanic-owned businesses account for 12 percent of all U.S. firms.Entrepreneur Growth Facts
- The number of all U.S. businesses grew by 10 percent, to about 23 million
- The number of female-owned firms grew by 20 percent, to about 6.5 million
- The number of Hispanic-owned businesses grew by 31 percent to nearly 1.6 million
- Asian-owned business increased by roughly 24 percent
- Women, of all races and ethnicities, own 28 percent of U.S. firms
- America's 9.1 million women-owned businesses employ 27.5 million people and contribute $3.6 trillion to the economy.
Similar to the majority of U.S. firms, most minority and women-owned firms are small, having no permanent employees other than the owner. About three-fourths of all U.S. businesses have no employees.
The number of businesses owned by black entrepreneurs grew more than four times the national rate for all businesses. This is an increase of 45 percent since the Census Bureau’s last snapshot. Revenues were also on the rise. Revenue from black-owned businesses grew by 25 percent during the study period, to about $89 billion.
Minority owned businesses are represented across all business sectors. The largest sector for black-owned firms was health care and social assistance. This sector has over a quarter of a million black-owned firms. The second largest sector was “other services” at over 200-thousand firms. New York State had the most black-owned firms. It was followed by California, Florida, Georgia, and Texas.
Source: U.S. Census Bureau for time period 1997-2002
The census bureau defines minority or women-owned businesses as private companies in which the group hold at least 51 percent of the stock or interest. The report does not classify public companies because they can be owned by many stockholders of unknown ethnicities.
Entrepreneurial interest is high across all age groups. Boomers moving toward retirement from first career have strong interest in business ownership. A Harris Interactive student study reports that two-thirds of students are interested in a future that includes a business of their own.
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