We celebrated the birthday of Dr. Martin Luther King, Jr. on Monday, an annual tradition that occurs every third Monday in January. This year, the day fell on his actual birth date, January 15. One of the main issues Dr. King fought for before his death was wage equality. At a rally of sanitation workers in Memphis, he stated, “Now our struggle is for genuine equality, which means economic equality.”
Advancing Economic Equality
Economic equality can mean different things to different people. The American Psychological Association defines economic inequality as the unequal distribution of income and opportunity between societal groups. This issue can be addressed in many ways, including entrepreneurship. Entrepreneurship allows individuals to grab hold of their future and create a path based on their ideas. However, becoming a business owner requires resources that have only sometimes been readily available to women in the U.S.
The Women’s Business Ownership Act of 1988 aimed to accelerate the growth of women-owned businesses. This has led to some progress in women’s business ownership, but there is still a long way to go. A Guidant Financial report found that women represented only 25 percent of all small business owners in 2023. Of those women, 4.6% were Asian, 11.3% were Black, 4.6% were Hispanic, and 78.4% were White (see Table 1).
Table 1: Women Small Business Owners in 2023
Source: Guidant Financial Report 2023
The Good and The Bad
Data from GoDaddy’s Venture Forward research initiative found that diversity in entrepreneurship is growing in general, with Black, Asian, Pacific Islander, American Indian, Alaska Native, and multiracial entrepreneurs collectively owning 29% of U.S. microbusinesses compared to 17% in 2019. Microbusinesses are categorized as small businesses with a unique domain, an active website, and usually fewer than ten employees.
Among women business owners, Black women have been consistently highlighted as leading the way in the entrepreneurial explosion. In a November 2023 article, Cindy Barth points out that Black women now comprise 10% of entrepreneurs surveyed in GoDaddy’s Venture Forward annual report, a 70% increase compared to before the pandemic. However, numbers can sometimes be deceiving, and the increase in businesses owned by Black women may or may not be cause for celebration.
A Harvard Business Review report shows that all businesses are not created equal and, more importantly, that while 17% of Black women owned or were starting businesses, only 3% were running mature businesses compared to 7% of White women. Maturity speaks to sustainability. Many Black women start businesses but might not receive equal opportunities to capital, which could hinder their sustainability.
Many of Dr King’s dreams have yet to be realized; however, progress has been made and continues daily. The challenge is to look beneath the surface, where the hidden substance exists. Let’s think and do more in 24!
