Even though Obama recently signed as part of the military spending budget a series of measures to enable enterprises to compete for more federal contracts, many Black entrepreneurs believe across-the-board spending cuts would decimate procurement opportunities – especially those for defense contractors. For the 11th straight year, the federal government has missed its overall small business contracting goal of 23% for total procurement. And as for Black-owned firms, contracts dropped 8% to $7.12 billion in fiscal year 2011, compared with fiscal 2010.
At a recent SBA conference, Ron Perry, president of the National 8(a) Association, a group of minority government contractors, advised firms to hold discussions with agencies and at the same time, batten down the hatches. Such moves, however, have a ripple effect: As companies downsize operations, they lay off employees and eliminate vendors who, in turn, will be forced to fire their workers.
For African American government employees, it will be even rougher sledding if government staffing is slashed through a budget sequester. Even some Republicans had to admit that defense-related cuts alone could eliminate as many as 1 million jobs. The Black unemployment rate currently stands at 13.8%, and continues to be alarmingly high due to the fact that Blacks have been disproportionately impacted by the declining public sector. In fact, a UC Berkeley Labor Center study revealed African Americans are 30% more likely to hold government jobs than other workers; from 2008 to 2010, 21.2% of African American workers were employed in the public sector versus 16.3% of their non-Black counterparts. From January 2011 t0 January 2012, the total percentage of public-sector employees workers dropped some 9%; those employed by the federal government fell roughly 5%. Whether sequestration is implemented or not, expect the delivery of more pink slips.
So how can we fix this problem? We cannot let a dysfunctional Washington wreck our businesses and employment status. For us, the kick-the-can approach is not an option.
We must make collective, proactive power moves. That means wearing out shoe leather, sending letters and emails and sing social media to get attention at 1600 Pennsylvania Avenue and Capitol Hill. We must force political leaders to exercise fair, prudent and responsible judgment in scaling back programs so they don’t further hobble those who have been the most challenged and unable to gain access to financing and contracts.
Business owners must mobilize and tap into groups like the Congressional Black Caucus, National Urban League, US Black Chamber and others to ensure the White House enforces provisions of the Small Business Jobs Act related to “parity” among federal procurement programs; unraveling “bundled” contracts; and holding primes accountable in meeting their subcontracting obligations. To further solve the unemployment conundrum, the Obama administration must develop a comprehensive program for urban America with job creation at its core. We must get them to improve government outreach efforts so those in need of support and services can effectively access offices of business advocacy and equal opportunity – and persist until you gain answers or assistance.
From my vantage point, the best way to help fix Washington and make a huge dent in the budget deficit is to develop more innovative, employee-producing companies and productive, tax-paying employees. It will require urgent advocacy to ensure our protection and advancement as full participants in the workforce and business mainstream.