In recent weeks, there has been a greater public focus to support Black-owned businesses. While there are plenty of amazing lists out there to help people find these businesses (and some are shared at the end of this post), it felt important to shine a light on why supporting Black-owned businesses is so important in the first place.
After the abolition of slavery, Black people were often limited by law to work in agricultural, domestic, and service work. These laws were known as “Black Codes,” and they allowed states to criminalize any activity that newly-freed Black people were participating in. Although the name “Black Codes” wasn’t used as much in the 20th century, many of the racist motivations from the Black Codes were recreated in the form of Jim-Crow Laws. The racial wealth gap is just as visible today as it was during the Jim-Crow era.
These institutional histories of workplace segregation and employment discrimination have real financial consequences for Black Americans today. In the 1930s, many of President Roosevelt’s New Deal programs were exclusively beneficial to White Americans, leaving opportunities for rebuilding economic wealth out of reach for Black Americans after the Great Depression. On top of this racial wealth gap, Black Americans continued to deal with job discrimination that left higher-paying jobs and homeownership almost impossible.
Today, the average wealth for White families is approximately seven times higher than that of Black families. One in four Black households have zero or negative net worth compared to less than one in ten White families without wealth. These are clear examples of the racial wealth gap that millions of Black families have been facing for years. On top of this, the unemployment rate for Black individuals is twice as high as that of White individuals… and that’s in a “normal,” non-pandemic economy.
Banking institutions in America have a long history of discrimination against BIPOC (Black, Indigenous, People of Color), and offering small business loans are no exception. A 2017 study from the National Community Reinvestment Coalition found that banks were twice as likely to provide business loans to White applicants than Black ones and were three times as likely to have follow-up meetings with White applicants than more qualified Black ones. Put very simply, starting a business in America when you’re Black is much harder from a purely financial standpoint alone.
So what can you do? Going out of your way as a consumer to support Black-owned businesses actively helps close this racial wealth gap by spending where it counts. When you shop and buy from Black businesses you are strengthening local economies and in turn helping foster local job creation that will likely go to BIPOC. Conversely, you are also holding companies with discriminatory practices and policies accountable by diverting your money elsewhere- your dollars can speak volumes.
Finally, actually finding Black-owned businesses is as simple as a quick Google search, which will quickly yield many directories and lists to choose from. To make it even easier, three resources are listed below:
Black Parade Route; www.beyonce.com/black-parade-route/
This curated collection was recently launched by Beyonce on Juneteenth and lists hundreds of black-owned businesses in art & design, fashion, and lifestyle industries among others.
Official Black Wall Street; www.officialblackwallstreet.com/directory/
We Buy Black; www.webuyblack.com
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