Figures for Black business ownership experiencing significant surge

Black business ownership is experiencing its most rapid growth in three decades, with the proportion of Black households owning a business more than doubling from 5 percent to 11 percent between 2019 and 2022, according to the U.S. Small Business Administration (SBA).

The number of women-owned businesses has seen a significant surge. Between 2019 and 2023, the growth rate of women-owned businesses surpassed that of men-owned businesses by 94 percent.

Census Bureau data forecasts a record-breaking 5.5 million new business applications filed in 2023, marking the strongest year for such applications on record. This momentum represents the third consecutive year of historic growth for small businesses.

Since 2020, the percentage of the SBA’s loan portfolio directed to minority-owned businesses has risen from 23 percent to over 32 percent.

The number and value of SBA-backed loans to Black-owned businesses have more than doubled, reaching nearly US$1.5 billion.

Lending to women-owned small businesses is rebounding, with loan counts increasing by 70 percent since 2020 and total loan amounts surpassing US$5 billion in 2023.

SBA Administrator Isabel Casillas Guzman remarked, “America’s rich diversity continues to drive entrepreneurship, with Black, Latino, and women founders launching ventures at unprecedented rates.”

The SBA also disclosed that in 2022, US$9.5 billion in federal contracts were awarded to Black-owned businesses – a US$490 million increase from the previous year.

Mark Madrid, associate administrator for the SBA Office of Entrepreneurial Development (OED), emphasized the significance of Black entrepreneurs to both the social and economic fabric of the United States.

In addition to financing programs, the SBA offers counseling, training, and business development initiatives to support entrepreneurs.

“More Americans are pursuing their entrepreneurial aspirations than ever before, with the rate of new business applications and establishments under continuing to soar,” he noted.

Over the past three years, there have been a record-breaking 16 million new business applications. From 2021 to 2023, the U.S. has witnessed more new business applications than in the previous four years combined.

The monthly average of 440,000 new business applications during the past three years is 46 percent higher than the average of the preceding four years. This surge is characterized by significant growth in entrepreneurship among women, Latinos, and Black Americans.