2002 Hispanic-Owned Businesses News Conference
March 21, 2006
Remarks of Valarie Strang
U.S. Census Bureau
It is said that “Every picture tells a story” and “A picture is worth a thousand words”. Today, I would like to tell you a story that paints a picture. One that the Census Bureau started back in July of last year when we released the first estimates from the 2002 Survey of Business Owners on Hispanic-owned firms.
At that time, estimates at the national level by kind of business and at the state level were made available. Now, we not only have the final estimates at these same levels but much more detail on the kinds of businesses Hispanics own and the states, metropolitan areas, cities, and counties in which they are located as well as the size of these businesses, in terms of both employment and receipts.
All Hispanic-owned firms (firms with paid employees and firms with no paid employees)
The results of the 2002 Survey of Business Owners show that between 1997 and 2002, the number of Hispanic-owned firms grew by 31 percent, three times the national average for all businesses.
There were nearly 1.6 million Hispanic-owned businesses across the U.S. in 2002. These businesses generated nearly $222 billion in revenue, that’s a 19 percent increase since 1997.
Thirteen percent of all Hispanic-owned firms (199,601) had at least one paid employee other than the owner in 2002 and employed more than 1.5 million people. Although the number of firms with paid employees went down by 6 percent since 1997, the number of employees increased by 11 percent, higher than the national average of 7 percent.
Four states showed the largest increases in number of employees between 1997 and 2002:
- California – 53,397 more workers
- Florida – 29,775 more workers
- New York – 14,448 more workers
- Texas – 8,995 more workers
The average number of employees per firm ranged from:
- 35 in the forestry, fishing & hunting, and agriculture support services industry;
- 26 in management of companies and enterprises;
- 15 in the administrative and support and waste management and remediation industry;
- 12 for manufacturing firms;
- 11 in mining, and accommodation and food services;
- 4 employees per firm for utility, finance and insurance, real estate and rental and leasing; and other services, such as repair and maintenance.
Firms with paid employees accounted for 81 percent ($180 billion) of the gross receipts of all Hispanic-owned firms in 2002, a 13 percent increase between 1997 and 2002. The average receipts for these employer firms were $899,575.
The industries accounting for the largest share of receipts for employer firms included wholesale trade ($37.5 billion), retail trade ($35.6 billion), and construction ($22.7 billion).
Firms with no paid employees
More Hispanics are going into business for themselves, without hiring additional employees. Between 1997 and 2002, the number of firms with no paid employees increased by nearly 386, 000 firms to reach 1.4 million. That’s a 39 percent increase, more than 3 times the national average of 12 percent.
Businesses run by Hispanic entrepreneurs with no paid employees took in $42.4 billion in revenue in 2002, up by 54 percent over 1997.
The industries accounting for the largest share of these receipts included construction ($8.8 billion), transportation and warehousing ($5.1 billion), and retail trade ($4.9 billion), followed by other services, such as repair and maintenance ($4.8 billion).
Four states showed the largest increases in the number of firms with no paid employees and overall revenue between 1997 and 2002:
- California – 93,930 more nonemployer firms and an increase of $3.4 billion in revenue
- Florida – 73,745 more nonemployer firms and $3.8 billion more in revenue
- New York – 59,588 nonemployer firms and an increase of $0.8 billion in revenue
- Texas – 89,382 more nonemployer firms and $3.6 billion more in revenue
KIND OF BUSINESS
In 2002, retail and wholesale trade accounted for 35.9 percent of all Hispanic-owned business revenue, followed by construction and manufacturing.
Nearly 3-in-every 10 Hispanic-owned firms operated in construction, and other services, such as personal services, and repair and maintenance.
The new data released today show strong growth in the number of Hispanic-owned businesses in diverse parts of the country.
States with some of the fastest rates of growth for Hispanic-owned firms between 1997 and 2002 included New York (57 percent), Rhode Island and Georgia (56 percent each), Nevada and South Carolina (48 percent each).
Highest number of firms
Four states accounted for the highest number of Hispanic-owned firms as well as the largest increase in number of firms since 1997:
- California led all states with 427,727 Hispanic-owned businesses, an increase of 91,322 firms since 1997. Fifteen percent of all businesses in California are owned by Hispanics.
- Texas ranked second with 319,339 firms, an increase of 78,943 firms since 1997. Eighteen percent of all businesses in the state are Hispanic-owned.
- Florida ranked third with 266,727 businesses owned by Hispanics, an increase of 72,825 firms since 1997. Seventeen percent of all businesses in the state are Hispanic-owned.
- New York came in fourth with 163,639 firms, an increase of 59,450 Hispanic-owned firms since 1997. Ten percent of all businesses in the state are Hispanic-owned.
The counties with the highest number of Hispanic-owned firms were Los Angeles County, Calif. (188,472); Miami-Dade County, Fla. (163,188); Harris County, Texas (61,934); and Bronx County, New York (38,325).
The fastest rates of growth for counties between 1997 and 2002 included Madera County, CA (499 percent); Osceola County, FL (444 percent); Martin County, FL (321 percent); Kaufman County, TX (307 percent); and Prince William County, VA (268 percent).
The cities with the highest number of Hispanic-owned firms included New York, NY (129,461); Los Angeles, CA (84,679); Houston, Texas (41,753); Miami, Florida (35,887); and San Antonio, Texas (29,654).
The fastest rates of growth for cities between 1997 and 2002 included South Houston, Texas (726 percent); Uvalde, Texas (651 percent); Kissimmee, FL (569 percent); Bell Gardens, CA (553 percent); and Santa Paula, CA (548).
EMPLOYMENT AND RECEIPTS SIZE
Looking at the employment and receipts size of Hispanic-owned firms in 2002.
There were 29,184 Hispanic-owned firms operating in 2002 with receipts of $1 million or more, compared to 26,666 in 1997, that’s a 9.4 percent increase.
There were 1,510 Hispanic-owned firms in 2002 with 100 employees or more, compared to 1,121 in 1997, that’s a 35 percent increase. Revenue for these Hispanic-owned firms reached $42 billion, compared to $28 billion in 1997, a 50 percent increase.
Looking at just those Hispanic-owned firms with 500 or more employees, the number of firms increased from 115 to 183 (a 59 percent increase) but the revenue increased from $5.5 billion to $14.8 billion between 1997 and 2002, a 169 percent increase.
DETAILED HISPANIC OR LATINO ORIGIN
In 2002, firms owned by people of Mexican origin accounted for nearly 700,000 or 44 percent of all Hispanic-owned firms. There were 109,000 Puerto Rican-owned firms, representing almost 7 percent of all Hispanic-owned firms. Cuban-owned businesses accounted for about 10 percent of all Hispanic-owned firms, or nearly 152,000 firms.
Businesses owned by Mexicans, Mexican Americans and Chicanos in 2002 were predominately located in California (39.4 percent) and in Texas (33.6 percent).
Sixty-one percent of all businesses owned by Puerto Ricans were located in just 3 states in 2002: New York (29 percent), Florida (22.4 percent), and New Jersey (9.7 percent).
Seventy-four percent of all Cuban-owned businesses were in Florida.
California, New York, Florida, and Texas accounted for 71.2 percent of businesses classified as Other Spanish/Hispanic/or Latino-owned.
The Census Bureau has projected that over the next two generations, from 2000 to 2050, the U.S. labor force will dramatically change in terms of racial and ethnic composition.
Hispanics in the labor force grew by 9.2 million in the previous generation, from 1980 to 2000. By 2050, Hispanics in the labor force will go from accounting for about 1 in 10 U.S. workers to about 1 in 4. Minority-owned businesses will therefore, be at the forefront of these changes.
Now, I hope that you have begun to visualize a picture in your mind, one that illustrates that Hispanic-owned firms are growing at a fast pace and are vital contributors to the U.S. economy.