A Path to Recovery for Black America

A Path to Recovery for Black America

Dingle, UNCF CEO Michael Lomax, Act-1 Group CEO Janice Bryant Howroyd, Economist Bernard Anderson (Source: Lonnie C. Major)

In his 69-minute State of the Union Address last week President Obama reset his administration’s agenda with a renewed emphasis on job creation and small business development. He stated: “We cannot afford another so-called ‘economic expansion’ like the one from last decade — what some call the ‘lost decade’ — where jobs grew more slowly than during any prior expansion.” To put more than 15 million Americans back to work, the President proposed, among other items, making use of the $30 billion in TARP funds that major financial institutions repaid to the government to fund small businesses and provide a one-year, $33 billion tax credit to encourage small companies to hire workers. Moreover, he urged Congress to pass a jobs bill — a $174 billion version was passed in the House last December.  He is seeking to achieve a delicate balancing act as he unveils his record balancing act, making investments in such areas as education and clean energy while imposing a domestic spending freeze to reduce the trillion-plus deficit.

Against this backdrop, BLACK ENTERPRISE in partnership with Walmart held its own forum to evaluate the economic and financial state of black America. Under the banner, “20/20 Vision: A Look Ahead at Black America in the Next Economic Boom,” the event brought together business leaders, policy makers, economists and entrepreneurs to discuss issues vital to the future of African Americans and the nation as a whole: jobs and workforce readiness; small business and innovation; and financial reform and wealth building.. The dialogue resulted in a series of policy recommendations directed to the Obama Administration as well as strategies for black-owned businesses, trade associations and other organizations shaping future plans. The analysis and recommendations came from a group of the best and brightest including BE Board of Economists members Bernard Anderson and Thomas Boston; BE 100s CEOs Janice Bryant Howroyd of temporary services giant Act-1 Group and Bill Mays of Mays Chemical, financial powerhouses Christopher Williams of Williams Capital Group LP and Eugene Profit of Profit Investment Management. Input was also provided from a cadre of Obama Administration officials: Labor Secretary Hilda Solis, United States Trade Representative Ron Kirk, White House Domestic Policy Council Director Melody Barnes, Commerce Department Senior Advisor Rick Wade, Presidential Economic Advisor Jared Bernstein and National Director, Minority Business Development Agency David Hinson. In reviewing policies in wide-ranging areas such as the green economy, education, global trade, financial reform and capital formation, many of these officials encouraged forum participants to play a role in the policy-making process by offering suggestions and feedback.

Although the Great Recession is officially over — Commerce reported on Friday that US GDP grew by 5.7% in the fourth quarter of 2009 — long-term joblessness continues to persist, especially for African Americans who must contend with the current 17.2% unemployment rate and rates in five states exceeding 20%. “There’s an old saying that when whites catch a cold, blacks get pneumonia. Joblessness is at the foundation of the dysfunction in black communities,” Wade asserted in his remarks.

Economist Anderson underscored Wade’s point. In his presentation as a panelist on the Jobs and Workforce Readiness panel, he maintained that blacks comprise 44% of the long-term unemployed and large numbers have given up finding a job. He further stated that traditional manufacturing and service jobs will not return with the recovery because of structural changes in the US economy. Furthermore, he says green jobs will not be able to make up for a good number of those positions. Act-1’s Howroyd, however, was optimistic in surveying the new business landscape. More individuals, she says, will have to come to grips with the fact that a large segment of the labor market with be comprised of a “permanent temporary workforce” in which workers will have to become more portable. And the shift to energy and technology sectors will require mass retraining and lifelong education. The upside: She believes opportunities will be bountiful for a new breed of “nimble workers.”  Another jobs panelist, United Negro College Fund President & CEO Michael Lomax maintains that historically black colleges and universities will play a vital role in the preparation of African Americans for emerging industries in the near term as well as over the long haul.

Entrepreneurship will serve as another driving force for future employment and economic advancement. In an interview session on small business and innovation, Philadelphia Mayor Michael Nutter asserts business growth and employment opportunities can flourish through more expansive public-private collaborations on the local level. In the complementary panel on small business and innovation, MBDA’s Hinson asserts “minority business must enter strategic alliances to compete for larger contracts and gain access to capital. It is important to remember all minority businesses are not small.” (For more detailed reports, see Black Enterprise Business Report (airing Feb. 6); upcoming video reports on BlackEnterprise.com; and the April 2010 issue of BLACK ENTERPRISE magazine.)

Using the dialogue and ideas from forum sessions, BE has developed what could be considered the first draft of an action for black America — a series of initiatives that serve as policy recommendations for the Obama Administration as well as directives for African American business owners, trade associations and civic groups.