We know that Black businesses are underrepresented in the business world; however, the number of Black-owned businesses in the US has spiked, according to a study by LendingTree.
The study also found that Black-owned businesses are more likely to be led by women. While women run one-fifth (22.3%) of all US businesses, they lead two-fifths (39.1%) of Black-owned businesses—nearly twice the national average.
Additionally, it found that Atlanta is the hub for Black-owned businesses for the third year running.
The percentage of Black businesses is growing in the US.
The number of Black businesses may be small, but it’s growing. In 2022, 3.3% of businesses were run by Black folks. But that number has increased by a fifth (22.2%). To put this into perspective, 2.7% of businesses were Black-owned in 2021, and 2.4% were in 2020 and 2019.
Matt Schulz — LendingTree chief credit analyst and author of “Ask Questions, Save Money, Make More: How to Take Control of Your Financial Life,” thinks the surge of Black-owned businesses could be linked to the economy.
“There’s no question that stubborn inflation and today’s high prices are spurring more people to seek new ways to supplement their income,” he says.
Atlanta has been the hub for Black-owned businesses for three years in a row.
The study examined over 100 metros with the most Black-owned businesses and found that 11.35% of Atlanta businesses were Black-owned in 2022, coming in first. This number has risen compared to previous years, as 8.8% of Atlanta businesses were Black-owned in 2021 and 7.4% in 2020, but Atlanta has continued to rank first place.
Atalanta has the 12th-highest Black population percentage among the metros featured, which could be a significant factor in its ranking. Fayetteville, NC, ranks second with 10.15 of Black-owned businesses, and Virginia Beach, VA, ranks third with 9.4%.
Women-run Black businesses are young but commercially successful
Nearly a third of women-ran Black-owned businesses (30.9%) have only been open for less than two years. While almost a quarter of women-run businesses (19.1%) have been open for two to three years, 16.6% have been running for six to 10 years.
Though these businesses are young, 55.2% make between $100,000 and $999,999 in annual sales, which is slightly higher than 54.7% of all Black-owned companies with similar figures.
Image: Wocintech
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