Blacks need notApply even with Non-Whites


Special to

The ancient adage that blacks are the last hired and first fired by white businesses has a new twist. A recent survey by the Los Angeles Times of small businesses in Los Angeles County revealed that the overwhelming majority of Asian, Latino and white-owned businesses refuse to hire African-Americans. Almost certainly the same survey would find a similar pattern of racial exclusion of blacks by non-white business owners in other cities.

This is a profound and disturbing finding for several reasons. Asian and Latino-owned businesses are the fastest growing segment of small business growth in America. The estimate is that small businesses, and that includes non-white owned businesses, employ about 70 percent of salaried employees. And despite the much touted current economic boom, black unemployment still remains the highest of any group in America. The usual suspects to blame for the pathetic record of non-black minority business owners in employing blacks are: Preference for hiring within their own ethnic group, paucity of resources to increase hiring, and the small or non-existent number of blacks living in the area where many non-black-owned small businesses are located. The biggest but unstated reason for the discrimination is that many non-white business owners have the same deeply-held racial biases and fears toward blacks as white employers.

The harsh fact is there is little blacks can do to change this. Many small businesses with few employees are virtually exempt from the most stringent federal and state laws barring discrimination. The threat of lawsuits, boycotts, and protest campaigns has virtually no affect on most of them since many operate on the barest of financial margins. The survey, however, pointed to a silver lining in the racial cloud. It found that back-owned businesses are more likely to employ blacks than other businesses. So instead of hammering non-white small business owners for their anti-black prejudices, the job is to expand the potential of black-owned businesses to create more jobs for blacks. The starting point is the enormous social and economic assets that African-Americans possess.

According to a special Census report in February 1999:
-Nearly nine out of ten African-Americans aged 25-29 are high school graduates and fifteen percent have college degrees.
-African-American median income continues to grow and the drop in poverty rates for African-Americans accounted for sixty percent of the overall drop in poverty in America.
-Twenty percent of African-Americans work in management or the professions.
-The number of black-owned businesses leaped nearly fifty percent, and their gross receipts rose 63 percent between 1987-1992.

It will take a battle on two fronts to meet the monumental challenge of ensuring that operating black businesses grow and new ones get started. The first battle must be waged by black trade associations, business groups, black elected officials, and community leaders. They must continue to pressure corporations to provide more loans, grants, technical assistance and training to minority businesses. At the same time, they must prod banks to eliminate the lingering vestiges of discrimination in their lending practices. The Soviet Union is out of business. The world is relatively peaceful. And private and government economists predict a federal budget surplus of billions at least for the next few years.
Therefore, there is absolutely no reason why the Clinton administration can‚t make good on its much touted pledge to revitalize economically undeserved urban areas. Increased small business growth would create thousands of private sector jobs for blacks, provide more goods and services, and increase tax revenues in impoverished communities.The second battle must be waged by black-owned businesses to guarantee their stability and growth.

Here are some immediate things they can do.

-Implement more self-help programs. Those black firms with ample capital and clout, and there are more of them than ever, could pool money into a development fund to provide loans, credit, resources, training, and a contact network to jump start new businesses.

-Become more efficient and continue to diversify. Black 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 black consumers in the importance of patronizing black businesses. Black Enterprise magazine estimates that blacks spend an estimated $300 billion annually on goods and services. They won‚t, or shouldn‚t, spend their dollars with black firms simply because they're black. Black-owned businesses must provide efficient service, and sell quality merchandise at competitive prices. They can help their cause by establishing or contributing to scholarship funds, and promoting job and skills training programs for the black poor. It's asking far to much for black-owned firms to solve the employment needs of all African-Americans. But with the right push many of them can insure that more blacks don't have to be the last hired.

Dr. Hutchinson, director of the National Alliance for Positive Action and author of four books is a Los Angeles-based Executive Editor of and The Black Business Journal. His E-mail is