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FOR IMMEDIATE RELEASE AT 10:30 A.M. EDT, JULY 12, 2001 (THURSDAY)News Conference and WebcastPublic Information Office CB01-115 301-457-3030/301-457-3670 (fax) 301-457-1037 (TDD) e-mail: email@example.com Eddie Salyers/Valerie Strang 301-457-3316
Minority-Owned Firms Grow Four Times Faster
Than National Average, Census Bureau Reports
Minority-owned businesses grew more than four times as fast as U.S. firms overall between 1992 and 1997, increasing from 2.1 million to about 2.8 million firms, according to a report released today [pdf] by the Commerce Department's Census Bureau.
The 30 percent growth rate exceeded the 7 percent increase for all U.S. firms, which jumped from 17.3 million in 1992 to 18.4 million in 1997.
Receipts of all minority-owned firms (excluding C corporations) rose 60 percent to $335.3 billion in 1997, compared with a 40 percent increase for all U.S. firms over the same period.
In releasing the report, Under Secretary for Economic Affairs Kathleen B. Cooper said, "We are pleased to report that this portrait of the American economy shows rapidly expanding opportunities for minority entrepreneurs and a more diverse universe of small businesses."
Ronald N. Langston, director of the Commerce Department's Minority Business Development Agency (MBDA), said, "Today's report clearly indicates minority businesses are growing at a faster rate than U.S. businesses overall." He further said, "As the director of MBDA, I will work to empower minority businesses to achieve higher levels of success by directing MBDA to be innovative and focused on entrepreneurship."
The growth estimates do not include C corporations, for which comparable 1992 data are not available. C corporations were covered for the first time in the report, 1997 Survey of Minority-Owned Business Enterprises: Summary. C corporations encompass all legally incorporated businesses, except for subchapter S corporations. Subchapter S corporations are those whose shareholders elect to be taxed as individuals rather than as corporations.
Forty-three percent ($255.9 billion) of all revenues generated by minority-owned businesses were produced by 252,900 C corporations.
Including C corporations, there were more than 3 million minority-owned business enterprises, employing 4.5 million people and generating $591.3 billion in revenues. Overall, minority-owned firms made up 15 percent of the nation's businesses and generated 3 percent of all receipts.
Minority-owned businesses are those owned by African Americans, Hispanics, Asians and Pacific Islanders, or American Indians and Alaska Natives.
The vast majority of these firms, 82 percent or 2.5 million, were sole proprietorships (unincorporated businesses owned by individuals).
Highlights from the report:
- California, Texas, New York and Florida, the nation's most populous states and home to nearly half of all minority residents, had the largest number of minority-owned businesses.
- While Hispanics owned the largest share of firms owned by minorities, Asian- and Pacific Islander-owned firms reaped the largest share of minority-owned business revenues -- 52 percent.
- Men were owners of about 55 percent of the firms owned by each of the four minority groups. African Americans had the largest percentage of firms owned by women -- 38 percent.
- Thirty-nine percent of all minority-owned firms had 1997 receipts of under $10,000; about 3 percent had sales of $1 million or more.
- Average receipts per firm were $194,600 compared with $410,600 for all U.S. firms, excluding publicly held corporations and firms (such as mutual companies) whose owners' race or ethnicity could not be determined.
- About 1 in 5 of all minority-owned firms had paid employees. More than 4,400 minority-owned firms had 100 or more employees.
- Fifty-nine percent of all minority-owned firms were in the services and retail trade industries, accounting for 43 percent of all receipts.
The following tables show the top states by number and percentage of minority-owned firms:
Ten States with the Largest Number of Minority-Owned Firms: 1997 Geographic Area Total Minority-Owned Firms Percent of Total Minority-Owned Firms in U.S. U.S. Total 3,039,000 California 738,000 24.3 Texas 365,500 12.0 New York 296,500 9.8 Florida 286,900 9.4 Illinois 110,300 3.6 New Jersey 102,300 3.4 Georgia 88,700 2.9 Maryland 82,600 2.7 Virginia 71,700 2.4 North Carolina 61,600 2.0
States with the Largest Percentage of Minority-Owned Firms: 1997 Geographic Area Total Minority-Owned Firms All Firms Minority-Owned Firms as a Percent of All Firms U.S. Total 3,039,000 20,821,900 14.6 Hawaii 54,300 94,000 57.8 District of Columbia 15,200 45,300 33.6 California 738,000 2,565,700 28.8 New Mexico 37,500 131,700 28.5 Texas 365,500 1,526,000 24.0 Florida 286,900 1,301,900 22.0 Maryland 82,600 400,200 20.6 New York 296,500 1,509,800 19.6 Alaska 10,700 64,100 16.7 New Jersey 102,300 654,200 15.6 Georgia 88,700 568,600 15.6
The data in the report were collected as part of the 1997 Economic Census from a large sample of nonfarm businesses filing tax forms as sole proprietorships, partnerships or any type of corporation with receipts of $1,000 or more in 1997. The economic census is taken twice a decade in years ending in 2 and 7.
The report presents data for minority-owned businesses by gender, size, type of business, geographic area (states, counties, metropolitan areas and places) and specific race and ethnic groups.
The data are subject to sampling variability, as well as nonsampling errors. Sources of nonsampling error include errors of response, nonreporting and coverage.
Further details concerning survey design, methodology and data limitations are contained in the full report. Comparisons with 1992 data should be conducted with extreme caution because of changes in tax laws that cause inconsistencies between the 1992 and 1997 data. Changes in survey methodology also may contribute to differences.
Percentage of Total Minority-Owned Firms by State Compared with Percentage of
Minority-Owned Firms to All Businesses by State: 1997
Geographic Area Total Minority-Owned Firms Percent of Total Minority-
Owned Firms in U.S.
All Firms Minority-Owned as a Percent of All Firms U.S. Total 3,039,000 20,821,900 14.6 Alabama 28,300 0.9 285,200 9.9 Alaska 10,700 0.4 64,100 16.7 Arizona 43,300 1.4 329,000 13.2 Arkansas 13,000 0.4 193,400 6.7 California 738,000 24.3 2,565,700 28.8 Colorado 37,000 1.2 410,200 9.0 Connecticut 20,400 0.7 284,000 7.2 Delaware 5,300 0.2 56,600 9.4 District of Columbia 15,200 0.5 45,300 33.6 Florida 286,900 9.4 1,301,900 22.0 Georgia 88,700 2.9 568,600 15.6 Hawaii 54,300 1.8 94,000 57.8 Idaho 5,200 0.2 109,800 4.7 Illinois 110,300 3.6 882,100 12.5 Indiana 22,800 0.8 413,400 5.5 Iowa 5,300 0.2 227,600 2.3 Kansas 11,700 0.4 213,400 5.5 Kentucky 12,700 0.4 281,600 4.5 Louisiana 41,700 1.4 295,700 14.1 Maine 2,800 0.1 127,500 2.2 Maryland 82,600 2.7 400,200 20.6 Massachusetts 39,000 1.3 537,200 7.3 Michigan 51,800 1.7 677,500 7.6 Minnesota 15,300 0.5 410,600 3.7 Mississippi 22,000 0.7 167,900 13.1 Missouri 26,600 0.9 411,400 6.5 Montana 3,400 0.1 93,700 3.6 Nebraska 4,600 0.2 138,800 3.3 Nevada 15,200 0.5 129,800 11.7 New Hampshire 3,200 0.1 115,700 2.8 New Jersey 102,300 3.4 654,200 15.6 New Mexico 37,500 1.2 131,700 28.5 New York 296,500 9.8 1,509,800 19.6 North Carolina 61,600 2.0 570,500 10.8 North Dakota 1,500 0.0 55,300 2.7 Ohio 49,400 1.6 781,300 6.3 Oklahoma 28,500 0.9 280,700 10.2 Oregon 18,200 0.6 291,600 6.2 Pennsylvania 49,500 1.6 837,800 5.9 Rhode Island 4,800 0.2 80,900 5.9 South Carolina 30,800 1.0 260,300 11.8 South Dakota 1,700 0.1 65,800 2.6 Tennessee 32,500 1.1 415,900 7.8 Texas 365,500 12.0 1,526,000 24.0 Utah 8,600 0.3 169,200 5.1 Vermont 2,100 0.1 67,500 3.1 Virginia 71,700 2.4 480,100 14.9 Washington 42,900 1.4 447,400 9.6 West Virginia 4,300 0.1 111,700 3.8 Wisconsin 13,700 0.5 366,400 3.7 Wyoming 2,100 0.1 49,400 4.3
NOTE: Detail may not add to the total because a firm may be counted in more than one state.