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Race, Ethnicity and Business Ownership Robert W. Fairlie University of California, Santa Cruz March 26, 2004 For "Entrepreneurship in the 21 st Century," by the Office of Advocacy, U.S. Small Business Administration and the Kauffman


  1. Race, Ethnicity and Business Ownership Robert W. Fairlie University of California, Santa Cruz March 26, 2004 For "Entrepreneurship in the 21 st Century," by the Office of Advocacy, U.S. Small Business Administration and the Kauffman Foundation

  2. Race, Ethnicity and Business Ownership 1. Where are we now? 2. Where might we be headed? 3. What can we do?

  3. Self-Employed Business Ownership Rates by Race and Ethnicity 2000 Census 16.00% 14.00% 12.00% 10.46% 9.88% 10.00% 8.56% 7.76% 8.00% 6.84% 6.11% 6.00% 4.26% 4.00% 2.00% 0.00% White, Non- African- Asian American White Latino Other Latino Multiple Races Latino American Indian

  4. Self-Employment Earnings by Race and Ethnicity 2000 Census $70,000 $60,000 $53,244 $52,805 $50,000 $40,441 $38,225 $40,000 $35,006 $33,036 $30,000 $28,121 $20,000 $10,000 $0 White, Non- African- Asian American White Latino Other Latino Multiple Races Latino American Indian

  5. Average Sales and Receipts by Race and Ethnicity of Business 1997 Economic Census: Surveys of Minority-Owned and Women-Owned Business Enteprises $500,000 $448,294 $400,000 $338,852 $300,000 $200,000 $174,069 $155,242 $100,000 $86,478 $0 White, non-Latino African-American Asian American Indian Latino

  6. Average Number of Employees by Race and Ethnicity of Business 1997 Economic Census: Surveys of Minority-Owned and Women-Owned Business Enteprises 5.0 4.0 3.1 3.0 2.4 2.0 1.5 1.2 1.0 0.9 0.0 White, non-Latino African-American Asian American Indian Latino

  7. Race, Ethnicity and Business Ownership 1. Where are we now? 2. Where might we be headed? 3. What can we do?

  8. Self-Employment Rates for All Workers Current Population Survey, Outgoing Rotation Group Files (1979-2000) 0.14 0.14 Asian 0.12 0.12 White, Non-Hispanic 0.10 0.10 Self-Employment Rate 0.08 0.08 Hispanic 0.06 0.06 Black 0.04 0.04 0.02 0.02 0.00 0.00 9 0 1 2 3 4 5 6 7 8 9 0 1 2 3 4 5 6 7 8 9 0 7 8 8 8 8 8 8 8 8 8 8 9 9 9 9 9 9 9 9 9 9 0 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 0 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 2 Year

  9. Figure 1 Self-Employment Rates by Race, Working Men 0.18 1.00 White Self-Employment Rate 0.90 0.16 0.80 0.14 0.70 Self-Employment Rate 0.12 Black/White Ratio 0.60 0.10 0.50 Black/White Ratio 0.08 0.40 0.06 0.30 Black Self-Employment Rate 0.04 0.20 0.02 0.10 0.00 0.00 1910 1920 1930 1940 1950 1960 1970 1980 1990 Census Year

  10. Self-Employment Earnings by Race and Ethnicity 1980-2000 Census $60,000 $50,000 $40,000 White, Non-Latino African-American Asian $30,000 American Indian White Latino Other Latino $20,000 $10,000 $0 1980 1990 2000

  11. Self-Employment Earnings Growth Rates by Race and Ethnicity 1980-2000 Census 25.0% 23.0% 20.0% 18.0% 17.6% 16.4% 14.4% 15.0% 10.0% 9.1% 6.8% 6.2% 5.1% 5.0% 3.6% 3.2% 0.0% White, Non-Latino African-American Asian American Indian White Latino Other Latino -1.7% -5.0% 1990-2000 Growth Rate 1980-2000 Avrg. Growth Rate

  12. Race, Ethnicity and Business Ownership 3. What Can We Do? • Financial Capital • Human Capital • Business Human Capital

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