Article from The Federal Reserve Bank of New York
Latino-owned businesses are growing in number and importance to the American economy.
Contributing more than $700 billion in sales to the economy annually, they are also an important
source of employment as sole proprietors and as firms with employees on payroll.
The 2012 U.S.
Census Survey of Business Owners estimated that Latino-owned firms have 2.3 million employees
on payroll, a number that by several counts has grown since the survey’s release. One in four
new businesses, traditionally key sources of new jobs, is now Latino-owned. Quite simply, small
business growth is tied to the fortunes of Latino-owned businesses.
Yet, research also shows that Latino-owned firms face significant growth barriers. Estimates from
the Stanford Latino Entrepreneurship Initiative (SLEI) highlight that only three percent of Latinoowned
businesses grow to $1,000,000 or more in annual revenues, compared to six percent
of white-owned businesses. In short, despite impressive numbers of startups, Latino-owned
firms tend to stay small.
This report builds on earlier work from SLEI and the Aspen Institute to probe firm-level and
environmental-level growth factors that influence Latino business performance. By comparing
Latino-owned firms to non-Latino white-owned firms, unscaled Latino-owned firms to scaled
firms, and metro areas of relatively strong Latino entrepreneurship to those with smaller shares of
Latino-owned businesses, we are able to discern the most acute challenges and begin to highlight
remedies to these challenges.
This report’s goal is to focus attention on potential investments at
the firm- and community-level that will advance Latino business growth. It draws on analysis of
U.S. Census Bureau data, surveys from SLEI and the Federal Reserve Banks, interviews with the
owners of scaled and unscaled Latino-owned firms as part of a research collaboration between
Stanford Graduate School of Business, the Federal Reserve Bank of New York, and Interise.
Written by Claire Kramer Mills,Jessica Battisto, Scott Lieberman, Marlene Orozco, Iliana Perez, Nancy S. Lee
No comments:
Post a Comment