Businesses Owned By Women of Color Growing Faster Than The Overall Economy.

Firms owned by women of color are growing at six times the rate of all U.S. firms, according to estimates released by the Center for Women’s Business Research and underwritten by Bank of America. Between 1997 and 2004, the number of privately-held firms that are 51% or more owned by women of color grew by 54.6%, while all privately-held firms in the United States grew by 9.0%.

The report, “Businesses Owned by Women of Color in the United States, 2004,” reveals that these businesses not only are growing in number, but also are expanding in employment (up 61.8%) and sales (up 73.6%). As of 2004, there are an estimated 1.4 million privately-held firms which are majority-owned by women of color and these firms employ nearly 1.3 million people and generate $147 billion in annual sales.

“There has been significant growth in women’s entrepreneurship among every major racial and ethnic group,” said Myra M. Hart, Professor, Harvard Business School and Chair, Center for Women’s Business Research. “Between 1997 and 2004, African-American women-owned businesses grew by 32.5%, while Hispanic women-owned businesses grew by nearly 64% (63.9%). The two groups seeing the largest growth in women-owned firms are Asian and Pacific Islanders and Native Americans/Alaska Natives (both grew by 69.3%).”

“This is a positive sign for the entire country,” Hart continued. “At this crucial time for the economy, we’re seeing that greater participation in entrepreneurship among women from a variety of backgrounds is playing an important role in facilitating economic growth.”

This is the final part of the Center for Women’s Business Research’s 2004 biennial update, which includes updated estimates of the number of women-owned businesses in the U.S., 50 states, and top 50 metropolitan areas. According to this report, the 1.4 million businesses that are majority-owned (51% or more) by women of color represent more than one-third (35.6%) of all of the firms owned by persons of color. Additionally, one out of every five (21.4%) privately-held, 51% or more women-owned firms is owned by a woman or women of color.

“Bank of America applauds the efforts of the Center for Women’s Business Research to learn more about women business owners – incredibly vital and important contributors to our nation’s economic health,” said Lynn Pike, president, Bank of America Small Business Banking. “I see the results of this study as a call to action for all financial service companies to design and deliver solutions that will help women-owned businesses grow and prosper now and into the future.”

When broken down by industry, the greatest estimated growth for firms owned by women of color was in services (55.8%), followed by
transportation/communications/public utilities (47.3%), and agri-businesses (34.8%).

The top 10 states for privately-held firms that are 51% or more owned by women of color (based on an average of the number of firms, employment, and sales) are: 1) California; 2) Texas; 3) Illinois; 4) New York; 5) Florida; 6) Maryland and New Jersey (tied); 8) Michigan; 9) Virginia; and 10) Ohio.

The 10 states with the highest growth rates of privately-held businesses that are 51% or more owned by women of color (based on an average of the number of firms, employment, and sales) are: 1) Oklahoma; 2) Vermont; 3) Alaska; 4) Montana; 5) Massachusetts; 6) Nevada and North Dakota (tied); 8) Idaho and South Dakota (tied);
and 10) Michigan.

The 10 states in which firms 51% or more owned by women of color comprise the greatest share of all women-owned firms are: 1) Hawaii; 2) California; 3) District of Columbia; 4) New Mexico; 5) Maryland; 6) Texas; 7) New York; 8) Florida; 9) Georgia; and 10) Alaska.

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