Black Business

0

Job Statistics Paint a Bleak Picture for

Inner City, but There Are Solutions

Black Business

The monthly Bureau of Labor report for May left many people scratching their heads. While it showed that the economy continues to sizzle, it also showed an alarming jump in black joblessness to 8 percent. This is more than double the current unemployment rate for whites.

This is not the only bad news. The Fed’s determination to put a hard brake on the economy by hiking interest rates could bring a repeat of the disaster during the administration of Jimmy Carter and the early Reagan years, when soaring interest rates dumped thousands of black workers into unemployment lines.

There is a widespread myth that everyone has benefited from the high-tech boom, but many blacks haven’t. According to the Computing Research Association, blacks represent only 5 percent of the nation’s computer programmers. The huge high-tech gap may not close soon. In 1996-97, blacks received less than 1 percent of the Ph.D.s in computer science and engineering. Meanwhile, millions of blacks continue to lag in access to computers and training.

These troubling warning signs, however, do not mean impending economic doom for black communities. A recent Pepperdine study, “Common Paths: Connecting Metropolitan Growth to Inner-City Opportunities in South Los Angeles,” shattered the media stereotype that black and brown communities are vast wastelands of rot and decay. The study noted that there are many prosperous black businesses and professional persons in the area whose skills are hidden and underutilized. They can be major players in the economic resurgence of black communities.

The newly formed South L.A. Economic Development Partnership not only hopes to prod corporations and banks to increase business investment, technical training, and loans for black and Latino businesses, but also to encourage greater involvement by black business people and professionals in developing community resources. And they do have the resources.

During the past decade, the growth of minority business has surged in California. And the impact has been the greatest in Los Angeles County. The numbers tell the tale of their success.

-L.A.’s black businesses last year generated $3.6 billion in revenues, and accounted for 11 percent of all revenues for black-owned businesses nationally. According to Black Enterprise magazine, black firms in 1999 continued to grow in sales, revenue and employment totals.

Black businesses have moved far beyond the traditional lower-end mom-and-pop retail stores and service industries. A significant number of these businesses are in music and movie production, transportation, finance, real estate, construction, equipment leasing, computers and data processing services. This is a good building block for black businesses in L.A. County to expand and provide capital, training and employment for more minorities.

There are several additional things that black businesspeople and professionals can do to enhance the economic vitality of South Central L.A. and other predominantly black communities.

-Provide more self-help programs. Minority firms with the resources can pool money into a development fund to provide loans, credit, resources, training and a contact network for new businesses.

-Become more efficient and continue to diversify. Minority-owned firms must concentrate more capital in research and development to upgrade products and services. Mergers, joint ventures, stock trading and expansion into international markets are essential tools for growth.

-Mount campaigns to educate minority consumers on the importance of patronizing their businesses. Black Enterprise in 1999 reported that African Americans spent an estimated $30 billion annually on goods and services. Minority consumers should not be expected to spend those dollars with minority firms simply because they’re minority-owned.

These firms must provide efficient services and sell quality merchandise at competitive prices. They can boost their cause by contributing to scholarship funds, and promoting job and skills training programs aimed at the minority poor.

-Black trade associations and business groups should lobby Congress, the Clinton administration and major corporations to provide more direct assistance to minority-owned businesses in Los Angeles County. This is not charity. Minority consumers and businesses pay taxes. They are right to expect government to invest a larger portion of tax revenues in urban growth programs.

-Black entrepreneurs must increase efforts to train and counsel young blacks in business management, marketing, leasing, franchising, financial planning and investments. And African-American churches, neighborhood centers, service agencies and businesses could donate facilities, reading materials and equipment for business start-up and job-training workshops.

The Los Angeles Urban League currently operates a model career development and training program for youth of all races throughout Los Angeles County. Also, the United Negro College Fund, in partnership with Coca-Cola, will provide scholarships and summer internships for black and Latino students in Los Angeles and other cities.

Tightened Fed money policies, the cyber divide, and a possible economic downturn should be cause for worry. However, they can and should also be cause for black business and professionals to marshal their considerable resources to insure that blacks don’t lose further ground because of these problems.

No posts to display