Report: Minority-Owned Businesses Coping With COVID
The coronavirus pandemic has had a major negative impact on business and commerce nationwide – most acutely felt by companies owned by merchants of color.
According to the Haas Business Center at the University of West Florida, there are about 58,000 businesses in Escambia, Santa Rosa, Okaloosa and Walton Counties. Of those, about 3,200 – or roughly 5.5% – are owned by merchants of color.
“These minority-owned businesses include everything from an acupuncture clinic to commercial construction [and] restaurants; along with travel and retail taking a big hit for the past 13 months,” said Nicole Gislason, Executive Director at Haas.
Last August, the Haas Center partnered with the Florida Small Business Development Center and the Florida Chamber of Commerce to conduct a survey of businesses statewide with fewer than 100 employees.
“We received responses from more than 4,800 business leaders, from all but two of 67 counties in the state,” said Gislason. “We extracted a slice of that survey data, which contains responses from 970 minority Florida business owners. Each reveal extreme concern about the economy during August of last year.”
During that month, retail stores and restaurants were ordered to maintain half-capacity. And the numbers involving white-owned and minority-owned firms, says Gislason, were telling.
“Sixty percent of all Florida business owners reported being extremely concerned about the economy, compared to 65 percent of minority business owners,” Gislason said. “Forty-one percent of all respondents indicated they were extremely concerned about acquiring capital and credit. Compare that to 55% of minority business owners.”
If there’s a common thread running through the financial difficulties facing all businesses – but especially minorities – is that many of their customers have lost their main sources of income by losing their jobs to the pandemic. The issue, says Gislason, is “business continuity.”
“Fifty percent of the minority business leaders indicated they were concerned about just maintaining operations,” said Gislason. “That group of people – they were not out spending extravagantly on meals and other things – even if they were permitted to.”
Some of the lesser concerns voiced by respondents were a bit surprising, says Gislason, such as supply chain issues and challenges inside the workforce.
“And that is surprising because prior to the pandemic, workforce was the number-1 issue facing business leaders in the United States and in the state of Florida,” Gislason said. “On the brighter side, you do see some optimism among about 35 percent of the respondents in the minority community. They are optimistic that within six months – that’s about this time frame – their sales and revenues will begin to increase.”
When it comes to businesses with owners of color, those in the four-county Western Panhandle fall in line with those in the rest of Florida. However, there is some growth in some areas of the minority landscape, such as financial services. And, many who have lost their jobs are now training for new ones.
“People have had the opportunity to reassess and retrain, and retool their human capital, if you will, and set out on new business adventures,” said Gislason. “I do think that’s going to help us turn the corner – both in the state of Florida and perhaps in the U.S. as well.”
One of the recommendations from the report, says the Haas Center’s Nicole Gislason, is additional funding for small businesses with fewer than 100 employees.
“To ensure a continuity of operation – we’ve seen that in subsequent PPP [Paycheck Protection Program] opportunities through the federal government.
There is a follow-on study; the Florida SBDC is driving that train right now in partnership with the Florida Chamber and Haas Center. We look forward to new findings,” said Gislason.
Details on last year’s survey can be found at www.haas.uwf.edu. In part two, a look at what’s going on with minority-owned businesses a little closer to home.