Why More Blacks Are Working for Themselves
Lesly Zamor knew leaving Wall Street to open a flower shop was risky.
The challenges of small business start-up, such as financing, are often tougher for a black-owned venture, but Mr. Zamor opened Bloom in New York in May 1993. "When you're black, everything matters," he says as he cuts a tulip stem, "but hopefully your skills will out-factor the fact that you're colored."
Four years after he traded bonds for bouquets, it's clear Zamor's skills have out-factored everything else: Bloom will pull in $1 million this year from contracts that include the Grammy Awards show. His story isn't remarkable, it's just one of the more colorful examples of a recent boom in black entrepreneurs.
Motivated by entrepreneurial ambition and a desire to evade the corporate glass ceiling, blacks have been going into businesses for themselves at a rate that eclipsed all other groups in the US in the early 1990s. Observers say the trend is continuing, and not just in reaction to vestigial corporate racism, but also in a reflection of a more general interest in becoming your own boss.
"In America in general, there's this return to entrepreneurship," says Crendalyn McMath, who heads the Center for Urban Business at the University of Illinois at Chicago. "As corporate America downsizes, there aren't a whole lot of options out there. When you layer that with being a person of color, that makes the drive for entrepreneurship even stronger."
The last US census report showed that African-Americans' drive for entrepreneurship outpaced the nation's by 20 percentage points, with the number of black-owned firms growing 46 percent between 1987 and 1992.
An urban phenomenon, they generated $1.7 billion a year in New York in 1992. The second-largest number of black-owned businesses is found in Washington, followed by Los Angeles, Chicago, and Atlanta.
This boom is really the continuation of a long tradition, says Michael Woodward, author of "Black Entrepreneurs in America." "Blacks have a rich history, even under the most onerous circumstances, of engaging in business enterprise," he says, citing their pre-Revolutionary involvement in road houses, transportation, mining, and New England's sail-making industry.
With the civil rights movement, significant numbers of Afri-can-Americans were hired into corporations, but ran into what some call "the concrete ceiling."
"They observed they would never be president or even vice president, and decided to go out on their own," says Mr. Woodward. "Many of them spent five to 20 years learning their industry, saving money, waiting to get into business for themselves."
Incidents like last year's Texaco fiasco - in which company executives were recorded using racial slurs - fuel blacks' disillusionment with corporate America, and may drive white-collar blacks to make it on their own. But Ms. McMath says different motives drive lower-skilled black workers.
"People are discovering there aren't that many opportunities for low-skilled labor out there, and in order for them to have a job, they have to create a job," she says.
Recent waves of downsizing in the corporate world, as well as in government, which traditionally hires large numbers of blacks, have also played a part, observers say. Some downsized workers opt to start their own firms, while others who don't lose their jobs are unsettled enough by downsizing to opt for self-employment.
"People increasingly want control of their own destiny," says Russell Roberts, an economist at Washington University in St. Louis. "And with the growth in high-tech and venture capital more available than ever before, it's easier to start up."
Indeed, the total number of small businesses grew from 807,000 in 1994 to 819,000 in 1995, according to the Small Business Administration, and have been providing the majority of new jobs in the US.
According to Patricia Greene, a professor at Rutgers University in New Jersey, this growth is driven by the fact that more schools are offering entrepreneurship classes, single parents appreciate the flexibility self-employment offers, and many inner-city self-help programs are emphasizing an entrepreneurial approach.
But even as black-owned firms multiply and flourish, experts are raising questions about the future. "Recent court decisions which place restrictions on affirmative actions and set asides ... will probably make it more difficult for firms to establish themselves solidly and grow," says Woodward.
Ms. McMath agrees, but she also sees a burst of activity prompted by another legislative shift. "Welfare reform is going to lead to perhaps a slight surge in self-employment," she says.