Businesses Prowess: Black Women Are Powering the U.S. Economy
Black women are the answer.
Various studies have found that Black women’s contributions to the U.S. economy as consumers, entrepreneurs, and employees play a key factor in the stability and success of the U.S. economy.
Black women are trendsetting consumers:
As trendsetters, brand loyalists, and early adopters, Black women have enormous influence as consumers. Setting valuable trends across mega industries such as music, television, fashion, and beauty, their standards even influence people’s buying decisions from other communities. Predictions from NielsenIQ show that by 2024, the buying power of the U.S. Black population is set to reach $1.8 trillion. Additionally, statistics estimate that by 2025, Black shoppers will have become an ever-growing consumer group as the population of Black people is expected to reach a 21% growth increase compared to the predicted 18% decrease in the non-Hispanic white population.
Black women continue to dive deeper into self-care, and when they find products that satisfy their demands, they put up the money. Data found that 38% of Black women say they will fork out more money for haircare products sold by Black-owned brands.
Markets are taking notice of these statistics, especially in industries such as Beauty and Haircare, which, according to the data analytics company, is a top category for Black consumers bringing in estimates of $2.29 billion in annual sales, and a total of approximately $7.42 billion in combined annual sales of beauty and skin.
Black Women are the highest-growing group of entrepreneurs:
Black women pursuing entrepreneurship has been a hot topic for several years. Unshackling themselves from workplaces and policies that weren’t made for their economic growth, Black women are finding niches in different markets and developing their own products that are of value to their community.
Since the COVID-19 pandemic, experts have reported that Black businesses surged due to Black women becoming the fastest-growing group of entrepreneurs. According to the latest female entrepreneurship data (2019), statistics on Black female entrepreneurship found that Black women account for 2.7 million or 21% of all women-owned businesses in the U.S., showing the highest growth in female-owned businesses with a 49.8% increase.
Employment participation rates rank over any other group:
Although spending and business ownership are significant factors in Black women powering the U.S. economy, their role in employment is a contributing component that should not be overlooked.
National Partnership for Women & Families reported that recent data on the women’s labor force found Black women’s participation rates remained the highest of any group since data collection started 50 years ago. January 2023 statistics showed Black women’s labor force participation was 62.6%, the highest compared to all other groups of women.
Economic progress is increasing thanks to Black women:
Bottomline, Black women may be the answer to economic recovery. Despite the long span of adversity they’ve faced in their financial position, decision-makers are coming to understand the benefit of ensuring Black women are well-represented and supported.
As previously reported by BLACK ENTERPRISE, Goldman Sachs made a major contribution in 2021, centering Black women business owners around its investment strategy. The investment company committed $10 billion in direct investment capital and $100 million in philanthropic support to advance economic progress for approximately one million Black women across the U.S.
“Our newly published research, Black Womenomics, suggests that no investment could have a bigger impact than unlocking the economic potential of Black women,” said David M. Solomon, chairman and CEO of Goldman Sachs, in a press release. “In the face of significant disparities, they’ve shown admirable resilience, especially as they’re starting businesses faster than anyone else in the U.S. Building on our 20-year history of investing in female entrepreneurs and underserved communities, we are now proud to partner with Black female-led organizations and an outstanding advisory council to invest in opportunities to unlock their economic and leadership potential.”
Research from the leading global financial institution found that reducing the earnings gap for Black women could generate over 1 million jobs in the U.S. and potentially increase the annual U.S. GDP by $300-450 billion in current dollars.
“Black women are at the center of this investment strategy because we know that capital has the power to affect change, and we know that Black women have the power to transform communities,” said Margaret Anadu, Global Head of Sustainability and Impact for Goldman Sachs Asset Management.
“If we can make our economy work for Black women, we all benefit,” Anadu added.