The number of Black-owned businesses fell by 41 percent, whereas White-owned businesses fell by only 17 percent, warranting a targeted "race budget."
Numerous prominent civil rights activists and Black leaders have asked President Joe Biden to include targeted funding for Black-owned businesses in the upcoming stimulus plan to tackle the detrimental economic impacts of the ongoing pandemic. Without federal aid, they argue, several businesses could be at the risk of shuttering down permanently in the next 90 days. In light of this, civil rights organizations such as the National Urban League and the United States Black Chambers have demanded part of the Biden administration's $1.9 trillion stimulus plan to exclusively be budgeted for Black entrepreneurs, CNN reports.
Civil rights leaders demand 'explicit' federal funding for Black businesses hit hard by pandemic - CNN https://t.co/LJkAgrTkhJ— Tariq Nasheed 🇺🇸 (@tariqnasheed) February 16, 2021
"It should be specific," asserted Ron Busby, the president and CEO of US Black Chambers. "It should not be minority, it should not be underserved, it should be Black." According to Black leaders, the pandemic has only exacerbated existing racial disparities. Although some progress has been made over the past few decades, Black entrepreneurs could face heavy losses if they do not receive immediate financial support. Furthermore, the United States could lose much of the progress it has made towards inculcating Black entrepreneurship. Therefore, civil rights activists have called on the federal administration to essentially develop a "race budget" to target Black-owned businesses.
“It should be specific, it should not be ‘minority,’ it should not be ‘underserved,’ it should be ‘Black.’- Ron Busby, president and chief executive officer of U.S. Black Chambers.— theGrio.com (@theGrio) February 16, 2021
Marc Morial, president of the National Urban League, was of the opinion that the Biden administration's stimulus package would be an improvement from what Trump had planned to offer American citizens. Nonetheless, he is still quite concerned that Black businesses will be neglected. He stated, "We would like to see explicit targeting. The idea is that Black businesses came to the pandemic thinly capitalized and already facing a range of challenges. Many have had to close because of no business, no savings, no reserve funds, and no access to financing." The federal funding is particularly important as most Black businesses do not qualify for Paycheck Protection Program (PPP) funding, as Busby noted.
Today, Dr. Biden, the First Lady of the United States, was in my neighborhood supporting a great Black-owned small business. Ya love to see it. ❤️ https://t.co/gukxvwZh5Y— Charlotte Clymer 🏳️🌈 (@cmclymer) February 13, 2021
This is because PPP loans are geared towards businesses that have a large staff or payroll budget. In stark contrast, Busby shared, 99 percent of Black-owned businesses are run by sole entrepreneurs. "I think it should be micro-business related," he said of Biden's stimulus package. "Those businesses specifically that have 10 or fewer employees." According to the leader, the Biden administration could simultaneously consider financial assistance for Black Americans who had to close down their businesses last year and want to reopen them, or alternatively, Black folks who lost their jobs and want to launch a start-up.
If you’re a black owned business, drop your company below. We wanna shop black only.— c h r i s’ a r t w o r k (@chrisxtillman) February 11, 2021
Last year, Black-owned businesses closed at a disproportionate rate. Entrepreneurs explained that they had they were rejected by banks for loans and overlooked in the first two rounds of PPP funding. As per data from the New York Federal Reserve, between February and April of 2020, the number of Black-owned businesses fell by 41 percent. In comparison, the number of White-owned businesses fell by only 17 percent. Overall, small businesses saw a drop of 22 percent. During a virtual roundtable with Vice President Kamala Harris and Treasury Secretary Janet Yellen, the latter claimed the US government would allocate $15 billion in "equitably distributed grants" to more than 1 million of the hardest hit small businesses. Nonetheless, this may not be nuanced enough to protect Black-owned businesses most at-risk.
Small black owned business thread 💗 I need more black owned businesses on my timeline I’m following her everybody that comments ✨— shop the link in my bio!! (@JadaaUnique) February 12, 2021