African American Women Business Owners Face Struggles in Workforce, Despite Rise in Demographic


    A whopping 95% of Internet experiences start with a search engine, but after the consumer gets to the page they are looking for, there is little to no information about the owners of the company. What the consumers may not realize is the fact that these businesses are increasingly becoming owned by African American women, in spite of a extensive racial wage gap.

    Recently, the Center for American Progress released a report detailing the role African American women have throughout the nation. As a demographic, these women are representing a positive change for both their families and the workforce.

    The report finds that in 2013, 66.9% of African American mothers were the household breadwinners, but these women face hard barriers in the work force including a lack of earned sick days, paid family and medical leave, the ability to request a flexible work schedule, and access to quality, professional, and affordable child care.

    Besides these setbacks, African American women are innovators in the workplace. They are entrepreneurs that create jobs in their neighborhoods, and generate significant incomes that would seem impossible in past generations. CAP shows that between 1997 and 2013, African American women-owned businesses grew by an outstanding 258%.

    Additionally, 2016 represented the first year where this demographic makes up a majority — 61% — of all African American owned businesses nationwide. As a whole, these businesses bring in $52.6 billion in revenue annually.

    These women are technologically savvy as well. According to Forbes magazine, a full 80% of small businesses will soon rely on cloud computing. These women entrepreneurs choose this method for its efficiency, accessibility, and cost-effectiveness.

    However, even though African American women are growing as an important segment of business owners, women are less likely to be employers than other women entrepreneurs. A total of 97% of African American women- owned businesses are the sole proprietors, compared to 89% of all women business owners. So this means that while these women are owning their own businesses, they do not have any employees.

    This fact represents the challenges African American women have concerning the ability to grow and scale their business.

    In addition, the nationwide wage gap poses a significant problem to African American women, no matter their financial status. Equal employee advocates have recently marked the Black Women’s Equal Pay Day, which represents the day that the earnings of African-American women will catch up with their white male counterparts.

    This day was August 23. Equal Pay Day for white women falls during the first week of April.

    Instead of earning the national 79 cents per every dollar earned by males, African American women earn 60 cents. To put this in perspective, throughout a 40-year career, black women will loose about $877,480 based on today’s standing wage gap.

    According to the National Partnership for Women and Families, if this gap closed these working women would have enough money for 169 more weeks of food for their families, 23 more months of rent, and 15 more months of mortgage payments.

    “As a double minority, we experience bias on multiple fronts,” Kelly Burton founder of Bodyology a women’s clothing line, tells Black Enterprise. “African-American Equal Pay Day is a good time to explore the ways those factors intersect and consider potential solutions to addressing the problem.”

    To potentially help close the gap, the National Association of Women’s Business Owners suggests more women should start their own businesses. They believe that if women are in charge of salary decisions, they will likely pay their female employees a higher wage.

    Even still, African American women business owners have struggles gaining loans to fund startups. While black women own 1.5 million businesses nationwide, they only received 0.002% of all venture funding throughout the past five years.