Create a New Type of Social/Economic Safety Net
"This is a Black Stream of Thought"
Vol: 7a, July 2022
Create a New type of Social/Economic Safety Net
According to Andre Perry, Brookings ---This is a structural problem created by Social Distancing of people of color----and the more we put these people and their workers at the risk of Covid 19, the longer the entire country will suffer.
Historically, the Black community is accustomed to Social Distancing and can become the leader in revitalizing our communities. Social Distancing from a Black perspective has always been there, from the ostracizing of slavery to the intentional Distancing of Jim crow and residential segregation. Black people have had to adjust to being separate from the rest of the community. The resilience of Black businesses and the Black community has always been fundamental to their very survival and essential to their economic recovery. So, policymakers must maintain their commitment to building more inclusive local economies and not fall back. For example:
1. Twenty-nine percent of all Black-owned businesses with paid employees are in the healthcare and social assistance professions, which include independent practices of a physician, as well as continuing care/ assisted living and youth services
2. Ten percent are in administrative, support, waste management, and remediation services which include call centers, temporary agencies, collection bureaus, and recycling and waste management facilities
3. Eight percent are in retail trade, including everything from grocery stores to home furnishing to gasoline. Restaurants are not included in this.
Black businesses stabilize our communities! Sixty-six percent of the employees of a Black business will be black, and 35% of Black businesses locate within Black communities. It is a fact that during the last Great Recession, nationally, minority and women-owned businesses added 1.8 million jobs from 2007-to 2012, while firms owned by white males lost 800,000 jobs.
Why? Because Black people are used to being unemployed and must create other methods to survive. It is a fact that unemployed people are more likely to start a business during a recession to avoid prolonged unemployment and financial hardship. This fact is more than likely to become a universal result led by the Black community today. For example, the recovery was primarily fueled by health care, accommodations, and food service industries, which have a higher share of MWBE ownership. But, again, the current recession issues that surround the businesses in health care, accommodations, and food service industries have made them volatile. Given such a potential result, there is little chance for Black business and community economic growth without a firm offer of financial inclusion.
Structural exclusion damages the economy, the long-standing problem facing racial and gender disparities in business ownership. Structural exclusion limits Black entrepreneurship and is no less insidious than Covid-19's impact on these small businesses. Still, because it is already a status quo built over the decades, there is not the same urgency to address it.
The Black community and their businesses are the Safety Net that must be revisited to rebuild our local economies. The country needs to widen its conversation to consider all people----in every city, suburb, and rural community--- should have an equal right to contribute to and prosper from the innovation of their Black and minority small businesses' involvement in economic growth.
We must recognize that strengthening local economies shortens the separation between cause and effect, allowing business owners, customers, and residents to comprehend their behavior's environmental and social impacts immediately. Therefore, we must advocate for changes that address various forms of structural exclusion, such as:
1. Policies advocating for paid sick leave, food security, targeted support for Black businesses, and more significant unemployment insurance
2. More funding from the newly revitalized US Department of Commerce Minority Business Development Agency to help local businesses
3. Assurances that the local community will receive a fair share of infrastructure monies
4. Targeted tax breaks, or location incentives for Black businesses located in inner-city communities
5. An annual public report on the returns promised to communities within Community Benefits Agreements
6. Directing a more significant percentage of the city's purchasing power toward local vendors based within its communities.
7. Creation and supporting the implementation of city-wide business development "10 Year Strategy" for incorporating Black businesses into community redevelopment