President Trump’s New Economy Challenge (Part 19 of 20). President Trump’s Economic Plan estimates a 3.5% annual growth rate that will produce 25 million new jobs this decade. To do so, the Trump Administration will need full support and engagement of America’s minorities to fulfill the President’s Urban Renewal Agenda. Year 2011, marked the first year in U.S. history that minority births exceeded White births. In 2015, over 50% of all U.S. children aged 5 years old were minorities. By 2020, more than 50% of all U.S. children are expected to be part of a minority race or ethnic group. By 2044, America will be a minority-majority nation. California, Texas, New Mexico and Hawaii are already minority-majority states. Minority-owned businesses are already the fastest growing group in the American business community. Unleashing the potential power of minority business owners will greatly benefit the U.S. economy and help unite a race-divided nation.
As forecast by the U.S. Census Bureau, by 2044 minorities are projected to be in the majority (over 50% of the U.S. population) given current demographic growth rates.
Population Growth Rates by Race & Ethnicity
From year 2000 to 2014, Whites grew only 2% since the turn of the Century as opposed to 37% for Asians, 35% Hispanics and 18% for Blacks. From year 2014 to 2060, the Census Bureau projects that Whites will decline by 8%, whereas Asians are projected to grow by 128%, followed by Hispanics at 115% and Blacks at 42%. The multiracial (officially “two or more races”) population is projected to grow by an incredible rate of 225%.
From a Jobenomics perspective, Americans spend entirely too much time debating income inequality and inequities between White-haves and minority-have-nots. As indicated by U.S. Census Bureau and U.S. Bureau of Labor Statistics data, the numbers of White-have-nots far exceed White-haves, and are comparable to minority-have-nots at the lower end of the wage scale. On the other hand, based on projected demographic trends, minority job and wealth creation is essential to American economic prosperity and social stability as the United States transitions from a White-majority nation to a minority-majority nation. The primary solution to enhancing minority labor force participation and increasing wealth in minority communities involves minority-owned business creation, which is growing significantly faster than White-owned businesses.
Growth Rate of Minority-Owned Businesses
Source: U.S. Census Survey of Business Owners 2007 & 2015, Jobenomics Analysis, $ Millions
The Census Bureau performs a Survey of Business Owners twice each decade. The 2011 Survey was conducted for business owners in 2007 and the 2015 Survey for 2012 owners. This growth rate chart was developed by Jobenomics as a summary of these surveys to show the tremendous rate of growth for minority-owned firms during the Great Recession of 2007 to 2009 and the period of slow U.S. economic growth during the post-recession recovery.
All U.S., White, Black, Asian, Hispanic and All Minority (including other racial and ethnic minorities) firms are shown. “Total Firms” include all firms from very big to very small nonemployer (e.g., the self-employed) businesses. “Employer Firms” employ a few to thousands of workers.
From 2007 to 2012, All U.S. “Total Firms” grew at 2%, White-owned firms decreased -4%, and All Minority-owned firms increased by 39%, which is incredible considering the austere times and onerous lending environment from financial institutions. During this time period, Hispanic-owned firms grew at 47%, followed by Black-owned at 35% and Asian-owned at 25%.
During the same period, All U.S. and White-owned “Employer Firms” downsized by -5% and -3% respectively. All Minority-, Hispanic-, Black- and Asian-owned firms grew by 20%, 17%, 4% and 23% respectively.
From 2007 to 2012, the total number of minority-owned firms grew 5.8 million to 8.0 million firms, a 39% increase mainly due to nonemployer/self-employed firm growth. In comparison, White-owned decreased during the same period.
The 2015 Census Bureau Survey of Business Owners also provides detail on sales, receipts and shipment values for all firms. Minority firms did extremely well. In 2007, All Minority-owned firms contributed approximately $1 trillion to the U.S. economy. In 2012, this amount increased by a combined 53% to $1.6 trillion. Asian-owned sales, receipts and shipment values increased during this period by 57%, followed by Hispanic-owned by 48% and Black-owned by 38%.
As the largest U.S. minority group, Hispanics are transforming the consumer landscape. Today, Hispanics control about $1.3 trillion in buying power, which equates to significant cultural, economic and political power. This buying power is expected to grow reaching 10% of U.S. GDP by 2020. Hispanic Millennials (Generation Y) represent 27% of all Hispanics and 21% of the entire U.S. Millennial generation born between 1981 and 2000, ages 16 to 35 (Hispanic Generation Z, born after year 2000, represent 35% of all Hispanics). In key markets like Los Angeles, Miami, Houston, New York and Chicago, Hispanic Millennials represent up to 55% of all Millennials. Hispanic Millennials are also rapidly growing in markets not traditionally associated with the U.S. Hispanic community. Recent surveys of Hispanic Millennials indicate that 71% believe in the “American Dream” of upward mobility compared to 55% for non-Hispanic Millennials. 42% of Hispanic Millennials versus 23% of non-Hispanic Millennials believed that getting a postsecondary degree was a strong indicator of success. 47% of Hispanic Millennials see owning a business as an indicator of success versus 23% of non-Hispanic Millennials.
Jobenomics sees tremendous future employment and revenue growth potential of minority-owned businesses given the significant rate of growth in minority populations and the rate of minority-owned business expansion over the last five years. Jobenomics believes that doubling minority-owned businesses from 8 million to 16 million is achievable within a decade, if communities implement initiatives to mass-produce highly-scalable small and self-employed minority-owned businesses.
Stay tuned for the final installment in the President Trump’s New Economy Challenge series entitled, “Jobenomics Commitment to The Trump Administration” scheduled for release on 7 April 2017.
Click to read the rest of the articles in a 20-part series on President Trump’s New Economy Challenge. Note: many series articles require a small ($5) subscription fee. Non-series articles and Jobenomics project reports are free at Jobenomics.com. All subscription fees are directly (100%) applied to the Jobenomics Urban Renewal Programs. Donations to revitalizing blighted inner-cities are most welcome.
Jobenomics deals with economics of business and job creation. The non-partisan Jobenomics National Grassroots Movement’s goal is to facilitate an environment that will create 20 million net new middle-class U.S. jobs within a decade. The Movement has a following of an estimated 20 million people. The Jobenomics website contains numerous books and material on how to mass-produce small business and jobs. Monthly website traffic exceeds one-half million hits, which is indicative of the high level of public interest regarding economic, business, labor force and workfare solutions. For more information, see Jobenomics Overview and the Author’s Biography.