August is National Black Business Month in the United States, where individuals and businesses recognize striving Black-owned businesses across the country. The net worth of the average Black household is roughly 1/10 that of the average white household ($17,150 compared with $170,000).[1] It may be tempting to blame this disparity on wage inequality, but income is a function of the labor market, and while it certainly plays a role in the accumulation of wealth over time, there is more at work here.[2] Wealth refers to transferable assets like real estate, financial investments, and business ownership that can be passed from one generation to another.[3] While income inequality is undoubtedly present and worth addressing, closing the wealth gap requires examining assets and the unequal access to assets (such as housing and business ownership) that has persisted for hundreds of years.[4] This makes Black business ownership particularly important: it is a path for creating sustained, multi-generational wealth.

The History of Black Business Month

According to Northern Virginia’s Black Chamber of Commerce, National Black Business month started with Historian John William Templeton and engineer Frederick e. Jordan Sr founded National Black Business Month in August 2004.[5] Their notion was to “drive the policy agenda affecting the 2.6 million African-American businesses.” The concept of this movement was to support Black-owned organizations to promote greater economic freedom for the Black community.[6] To that end, Jordan and Templeton have pushed to create a more hospitable environment for Black-owned businesses to grow by reaching out to local government officials, community leaders, and venture capitalists.[7]

Good News about Black Business Month

This past year had been particularly difficult for Black-owned businesses. National Geographic reported that researchers at the University of California Santa Cruz found that the COVID-19 outbreak disproportionately hurt minority businesses – with Black-owned businesses being especially disrupted. [8] They found that 41% of Black-owned businesses had been shuttered due to the pandemic, a striking difference from just 17% of white-owned businesses.[9] However, even with statistics stacked against them, Black businesses continue to show their resilience, operating and thriving against odds, especially during the pandemic.[10] According to the Los Angeles Times, the pandemic saw a boom in new Black-owned businesses – the most significant surge in the last quarter-century.[11] On average, 380 out of every 100,000 Black adults became new entrepreneurs during the 2020 pandemic, according to the study, based on census data.[12] Thus, for many workers in the black community and future entrepreneurs, the economic crisis caused by the COVID-19 has only led to more opportunities for better futures.

Let’s celebrate Black Business Month! Check out these websites and apps that help buyers find Black-Owned businesses to patronize:

 

 

 

 

 

[1] https://shopwithgoodintent.com/blogs/news/why-you-should-redirect-your-spending-to-more-black-owned-businesses

[2] https://shopwithgoodintent.com/blogs/news/why-you-should-redirect-your-spending-to-more-black-owned-businesses

[3] https://shopwithgoodintent.com/blogs/news/why-you-should-redirect-your-spending-to-more-black-owned-businesses

[4] https://shopwithgoodintent.com/blogs/news/why-you-should-redirect-your-spending-to-more-black-owned-businesses

[5] https://www.northernvirginiabcc.org/

[6] https://business.nextdoor.com/local/resources/what-is-black-business-month-and-how-can-my-business-show-support

[7] https://business.nextdoor.com/local/resources/what-is-black-business-month-and-how-can-my-business-show-support

[8] https://www.nationalgeographic.com/history/article/black-owned-businesses-may-not-survive-covid-19#:~:text=Research%20at%20the%20University%20of,percent%20of%20white%2Downed%20businesses.

[9] https://business.nextdoor.com/local/resources/what-is-black-business-month-and-how-can-my-business-show-support

[10] https://www.forbes.com/advisor/personal-finance/covid19-financial-impact-on-black-businesses/

[11] https://www.latimes.com/politics/story/2021-06-28/pandemic-silver-lining-black-owned-business-startups-surge-to-25-year-high

[12] https://www.latimes.com/politics/story/2021-06-28/pandemic-silver-lining-black-owned-business-startups-surge-to-25-year-high