Lingua Nigra jewelry designer Alicia Good
The year 2020 has brought a lot of unexpected changes and raised awareness on a number of issues globally. One such wave of impact were numerous global protests inspired after the recorded murder of George Floyd, an African American male on May 25th, 2020 in Minneapolis by a police officer.
These protests have evolved into a movement, catalyzing Black Lives Matter. As millions take to the streets, demanding justice for the murder of George Floyd, Breonna Taylor and countless others, the fight against police brutality and for equal treatment continues. While the protests have successfully raised awareness and exposed many biases, the race to implement racial equity and social justice has some companies searching for solutions.
Diversity and inclusion searches jumped over 90% in May alone.
So how does a country fight systemic racism while building a better economy? Supporting black-owned businesses has been identified as one such step that can be taken by those who want to help and be a part of the solution.
So, why support black-owned businesses? Here are 6 reasons:
1. Economic Diversity
According to a definition on Churma.com, “Economic diversity measures the degree to which a region utilizes a broad mix of economic activities.” It’s an important indicator of how well a country will fare during unforeseen economic hardships. By removing barriers to entry for black and minority led businesses, the statistical variation of economic diversity naturally increases. Here is a list of successful companies founded or owned by black entrepreneurs.
It’s important to note that while systemic discrimination in the business, housing and banking sectors have contributed to disparity, minority owned businesses are as capable as their counterparts. To get a better understanding of how slavery still impacts business today, view this comprehensive study by American Progress.
2. Closing the racial wealth gap
The wealth gap between black families and Caucasian families continues to increase yearly and has been one of the main contributors to a lack of equity in opportunities. Wealth refers to your net worth (sum of your assets less liabilities). Black households in the United States have, on average, a lot less wealth than white households. In 2016, the average wealth of households with a head identifying as black was $140,000, while for white-headed households was $901,000, nearly 6.5 times greater.
The current racial wealth gap is the consequence of many decades of racial inequality that imposed barriers. Black people specifically were historically prevented from building wealth by slavery and laws (Jim Crow laws) that enforced segregation until the 1964 Civil Rights Act. Government policies were often designed to exclude people of color and prevented them from getting home loans and building on and acquiring more wealth which could be passed down throughout generations. The median white family has 41 times more wealth than the median African-American family and the Statistics are alarming.
How can supporting black – owned businesses help? Support of black businesses means an increased flow of wealth to black families and black communities and more job opportunities created. This not only helps to close off the racial wealth gap over time but it creates equal opportunities where the ability to own homes and create generational wealth can provide for future generations.
3. Creates a new vision for the black community
Supporting black-owned businesses will result in a drive of enthusiasm that can not only cause existing black businesses to thrive, but inspire others to emerge. This helps to reshape the look of the black communities (many of which are poverty stricken) and creates new direction and vision. The 2002 American comedy Barbershop depicts just how much of a positive impact the existence of black businesses have and the encouragement it provides to the members of the black community. As a result poverty and the parallel rate of crime will reduce, which benefits all.
4. Fosters supplier diversity
Support for black-owned businesses is support of supplier diversity which is viewed as a social responsibility. Supplier diversity strategically ensures that diverse groups are incorporated in the supply chain. Diverse groups include women’s groups, minority groups etc. The benefits are real and impacts not only on a community level but on a national level and will allow us to play our part in ensuring supplier equity.
5. Boosts the economy
It goes without saying that support for black-owned businesses will boost the economy. Data shows that Black entrepreneurs and small business owners find it difficult to acquire small business loans from banks. Increased support of black-owned businesses is sure to result in growth and an increased flow of capital that will benefit the local community and collectively boost the economy.
6. Helps to heal and ease the struggles of a people.
People of African descent have suffered many injustices throughout history, leaving psychological and physical scars. Black businesses have also been through a lot. This month marked the 99th anniversary of the Tulsa, Okla race massacre, when white rioters looted and burned the Greenwood District, a prosperous African-American area known as “Black Wall Street.” The episode is just one example of how black businesses have been targeted by either hostile individuals or unfair government policy.”- MarketWatch.