The Rise of Minority Entrepreneurs in the United States

minority entrepreneur, Illinois small business lawyer, small business attorneyFor decades, minority-owned businesses and other forms of minority-led entrepreneurship have been on the rise in the U.S. In fact, from the period of 2002 through 2007, there was a 46 percent increase in the amount of minority-owned businesses. This increase has been aided by a variety of impetuses including the U.S.’s ever increasing immigrant and refugee population.

The Rise of Minority and Immigrant Entrepreneurs

It may be shocking to learn that minority-owned businesses account for 15 percent of the 28 million small businesses in America. These minority-owned small businesses employ around 5.9 million U.S. workers. According to data released by the Small Business Administration (SBA) in 2007, it was discovered that African-Americans owned 1.9 million small businesses, Asian entrepreneurs were the owners of 1.6 million small businesses, and Hispanics accounted for the ownership of 2.3 million small businesses. It is assumed that in the next five to 10 years these ownership numbers will only rise.

What’s Driving Minority Business Growth?

There are three reasons why minority business growth has continued to consistently rise in the U.S. First, the aftermath of the 2008 crash and subsequent economic downturn has emboldened people of all races to pursue various forms of self-employment. Creating a small business for many represents an ability to achieve a type of financial independence that can only result from being one’s own boss.

Second, ironically immigrants specifically are the most uniquely situated to benefit from all of the advantages that come with owning their own business. A 2013 study discovered that immigrants are almost two times as likely as native-born Americans to start new businesses. This along with the ever-growing U.S. minority immigrant population has encouraged the proliferation of minority-owned businesses in increasingly high numbers. Many refugees and immigrants do not have access to traditional employment opportunities. This is because they may have limited English skills, lack an American diploma, or are dealing with other professional limitations that would not make them desirable hires to traditional employers. These factors, as well as characteristically low-income levels, have motivated immigrant minorities to create their own businesses in order to put the skills that they do have to good use. Small business ownership allows those that do not have much to offer as a member of the general workforce to achieve both success and financial independence.

Third, has been the ability of savvy minority entrepreneurs to purchase already established businesses from baby boomers looking to retire. This trend has emerged in full force during the last few years, as the worst of the economic downturn has passed. Now the U.S.’s large, aging, but robust baby boomer population is starting to feel that this is a favorable market to liquidate substantial assets in order to plan for or begin retirement. Baby boomers looking to sell their businesses have eager buyers in minority entrepreneurs looking to purchase and operate businesses within their communities that already have an established reputation and client base.

The increase in minority-owned small business represents the spirit and ideals on which this country was founded. If you need small business law advice, contact the Gierach Law Firm small business law attorneys here in Naperville, Illinois.