Has Black Business Ownership Reached New Heights Under President Joe Biden’s Administration?

During President Joe Biden’s recent years in office, there has been a significant increase in Black business entrepreneurship. Reports from the U.S. Census Bureau and the Federal Reserve Board have provided data indicating record levels of Black business ownership in 2021 and 2022, the most recent years available.

Various independent analyses have also suggested that some of President Biden’s policies may have contributed to these increases. In an advertisement launched during Black History Month, President Biden highlighted the progress made by Black Americans under his administration, including the lowest Black unemployment rate in history, a significant reduction in Black child poverty, and the record numbers of new Black entrepreneurs. These claims were rated Mostly True.

One policy that has received scrutiny is the Paycheck Protection Program, established during the pandemic to lend businesses money to maintain employee wages amid business restrictions. It was found that minority-owned businesses initially had difficulty securing loans from the program. However, changes introduced during the Biden administration, such as expanding lender participation and proactively reaching out to minority businesses, helped address this issue.

Data provided by the U.S. Census Bureau’s Annual Business Survey, as analysed by the Brookings Institution, highlighted the steady increase in the number of Black-owned businesses with more than one employee since 2017. The largest uptick was observed between 2020 and 2021, with a 14.3% increase. Similarly, the Federal Reserve’s Survey of Consumer Finances in 2022 demonstrated that 11% of Black households held equity in a business, significantly higher than the 6.6% recorded in 2016.

Furthermore, Black-owned businesses have shown growth rates in various sectors outpacing those of businesses owned by whites, Asian Americans, Latinos, or Native Americans. This includes a 7% increase in employees, a 30% increase in revenue, and a 27% increase in payroll in 2021.

Despite these positive developments, there remains a significant disparity between Black and white business ownership in the United States. Statistics show that while Black Americans represent 14.4% of the population, they only constitute 2.7% of business owners, in contrast to white Americans, who make up 72.5% of the population and own 82% of businesses.

Moving forward, it is evident that more work needs to be done to close this gap. Although it is encouraging to see the increase in Black entrepreneurship under President Biden, efforts are needed to address systemic barriers that contribute to these disparities. Sole proprietorships, in particular, comprise a substantial portion of Black-owned businesses, reflecting unequal access to capital, networks, and government contracts.

In conclusion, the record numbers of new Black entrepreneurs during President Joe Biden’s administration are supported by data from authoritative sources. The policies implemented, particularly changes to the Paycheck Protection Program, have been instrumental in fostering this growth. However, it is essential to acknowledge that significant disparities still exist and further efforts are needed to achieve equity in business ownership.