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Valerie Strang

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Large Increase in Number of Asian, Pacific Islander, American Indian, and Alaska Native Businesses Between 1987 and 1992, Census Bureau Reports

EMBARGOED UNTIL:  AUGUST 1, 1996 (THURSDAY) - The number of businesses owned by Asians, Pacific Islanders, American Indians, and Alaska Natives in the United States increased 61 percent from 439,271 in 1987 to 705,672 in 1992, according to a report released today by the Commerce Department's Census Bureau, entitled "1992 Survey of Minority-Owned Business Enterprises--Asians and Pacific Islanders, American Indians, and Alaska Natives" (MB92-3).  This compares to a rate increase of 26 percent for all U.S. firms, from 13.7 million in 1987 to 17.3 million in 1992.

Receipts for these minority-owned businesses increased by 159 percent during this five-year span, from $40 to $104 billion. In comparison, receipts for all U.S. firms grew 67 percent, from $2.0 to $3.3 trillion.

The number of businesses owned by Asians and Pacific Islanders increased 56 percent over this five-year period from 386,291 to 603,439, while receipts increased 163 percent from $36.5 to $96.0 billion.

The number of American Indian- and Alaska Native-owned businesses increased 93 percent from 52,980 in 1987 to 102,234 in 1992.  Receipts for these businesses increased by 115 percent from $3.7 to $8.1 billion.

Due to sampling methodology, detailed estimates are not available for all the minority-owned firms in the survey.  Therefore, the following statistics cover 606,438 of the total number (705,672) of businesses reported in the survey.

Receipts per firm averaged $165,000 for firms owned by members of these four minority groups, compared with $193,000 for all U.S. firms.  Thirty-five percent or 212,928 of these minority-owned businesses had receipts under $10,000, while 12,517 of these firms had sales of $1.0 million or more.

The survey also shows that the 22 percent (136,000 firms) of Asian-, Pacific Islander-, American Indian-, and Alaska Native-owned firms with paid employees accounted for 81 percent of gross receipts of these minority-owned firms.  Of these firms, 705 had 100 or more employees and accounted for $17.9 billion in receipts.

The service industries accounted for 45 percent of the businesses owned by Asians, Pacific Islanders, American Indians, and Alaska Natives but only 26 percent of gross receipts.  The retail trade industry accounted for the next largest concentration of these minority-owned firms at 22 percent of the firms and 29 percent of the receipts.

Approximately 83 percent of these firms were sole proprietorships in 1992.  Partnerships and subchapter S corporations comprised 8 and 9 percent, respectively.  (A sole proprietorship is an unincorporated business owned by an individual; a partnership is an unincorporated business owned by two or more persons; and a subchapter S corporation is an unincorporated business with 35 or fewer shareholders.)

Three states--California, New York, and Texas--accounted for 55 percent of the firms owned by Asians, Pacific Islanders, American Indians, and Alaska Natives.

Hawaii had the highest percentage of firms owned by members of these minority groups at 49 percent;  44 percent of the receipts in the state were from these minority-owned businesses.  California ranked second with 10 percent of all firms and 9 percent of all receipts.  Alaska was third with 7 percent of all firms and 5 percent of all receipts.

The report contains information on the number of firms, receipts, number of paid employees, and annual payroll.  These data are presented by geographic area (the nation, states, and selected metropolitan areas, counties, and cities), industry, size of firm, and legal form of organization with comparative 1992 data for all U.S. firms.

The data in this report were collected as part of the 1992 Economic Census from a large sample of all non-farm businesses filing tax forms as sole proprietorships, partnerships, or subchapter S corporations (corporations other than subchapter S were excluded), and with receipts of $500 or more in 1992.  The report does not include C corporations, which are legally incorporated businesses with no limits on their number of shareholders.

The information was collected from a sample survey, and is therefore subject to sampling variability as well as reporting and coverage errors. Comparisons to 1987 should be done with extreme caution because changes in tax laws cause inconsistencies between the 1987 and 1992 data.  Changes in survey methodology also may contribute to the differences.

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Editor's note:  Selected tables from the report will be available on the embargo date on the Internet at: //www.census.gov/agfs/www/smobe.html

ASIAN-, PACIFIC ISLANDER-, AMERICAN INDIAN-, AND ALASKA NATIVE-OWNED FIRMS BY GROUP: 1992