Black Women Help Reignite Growth of Black-Owned Businesses Hit by Pandemic
The number of Black-owned businesses saw a drastic decline after the start of the COVID-19 pandemic. But leave it up to Black women to lead the pack in the number of new businesses.
Recent studies show Black women have been at the forefront of creating new businesses, Business Insider reported. After the number of Black-owned businesses took a hit by 40% in April 2020, women of color were among the largest group starting new businesses during the height of the pandemic.
Prior to the pandemic, Black women were already surpassing Black men and women in general in the number of new businesses being launched. A 2019 Wells Fargo report found that 35% of Black-owned businesses were owned by women, over 10% more than the number of female-owned businesses in the U.S. economy.
Black businesses took an even bigger hit due to disparities within the government aid program meant to help small businesses during the financial crisis. But only 29% of Black-owned business applicants received relief from the Payment Protection Program compared with 60% of white business owners.
Despite the grim realities, Black women have continued to take the lead when it comes to revitalizing the nation’s economy. Whether out of financial need or frustration over being underpaid and undervalued at work, Black women have been the country’s fastest-growing group of female entrepreneurs, according to Biz Women.
“At a time when folks are rethinking their lives and choices, it is not surprising that more Black women are electing to become CEOs of their own companies rather than waiting for their intelligence and skills to be recognized at their current firms,” Melissa Bradley, founder of 1863 Ventures, an agency for Black and brown entrepreneurs, said.
The influx of Black women launching businesses is reflective of the ongoing Great Resignation that saw millions of women leave jobs due to policy issues over lack of childcare, fair pay, remote work options for work-life balance, and avoidance to expose themselves to the coronavirus.
“The potential return of the freedom of time, lack of unnecessary controls and financial success far outweighs the risk of failure for these Black female entrepreneurs when leaving their full-time jobs,” Bradley said.