My colleagues and I recently completed an analysis of the 2018 Annual Business Survey to identify the state of Black-owned business on the eve of Covid-19. To refresh: our topline finding showed that there are 124,000 Black-owned employer firms in the U.S., representing only 2.2 percent of all employer businesses.

Black-owned employer businesses in the U.S. are smaller, with fewer employees, lower average revenues, and lower average payroll expenditures, than businesses overall. A key—but not sole —reason for this is because these firms concentrate in sectors of the economy that pay less and offer fewer opportunities for productive growth.

This week we drill down further to assess the varied performance of the states on this important topic. This assessment is timely given the important role that states have taken on during the COVID-19 crisis and the underlying powers and resources they have at their disposal.

Initial Findings

Unsurprisingly, Black-owned businesses are concentrated in states that have large Black populations. By raw numbers, Florida, New York, California, Texas, and Georgia lead the nation in the number of Black-owned businesses. These five states also lead the nation in Black population, with more than 2.2 million Black inhabitants each, as of 2017.

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