Economic Inclusion Benefits Entire Area

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Economic Inclusion Benefits Entire Area

Since the 1980s the unemployment rate in the Cincinnati region has fallen from 7.4 percent to 4.7 percent. This remarkable decrease in the unemployment rate is largely due to vibrant employment growth, 80 percent of which was created by small businesses.

For the African American population, the unemployment rate historically has been much higher. In the 1980s, it was three times higher than the Caucasian rate. Over the past fifteen years, the unemployment rate for African Americans has fallen more rapidly and now is 2.6 times the Caucasian rate. While the gap is still large, many people feel that the narrowing of the gap is partially due to the strong growth in minority-owned businesses.

According to the Census Bureau, during the last decade the number of minority-owned businesses in the U.S. increased by 168 percent which is three time the growth rate of U.S. business overall. Revenues grew at an even faster pace during that time, an impressive 343 percent. Now this growth in minority-owned businesses appears to be having a positive impact on minority employment.

The Cincinnati USA Regional Chamber’s Minority Business Accelerator Program is one effort to expand the capacity of minority-owned businesses by increasing recognition of the value of minority businesses as suppliers, strategic partners, and effective engines of job growth. A survey of the employment demographics of Minority Business Enterprises (MBEs) participating in the Accelerator Program showed that more than 40 percent of the executives in MBE firms are African American and that 57 percent of their employees are of a minority status. Almost all participating minority businesses have specific programs that promote minority participation in their applicant pool.

MBEs have a substantial impact on our local business activity, earnings, and employment. A study completed for the Accelerator Program by the Economics Center for Education & Research shows that from 2004 to 2006, minority businesses generated an economic impact of $273.5 million and helped to create nearly 4,500 jobs in the local region. An example of economic inclusion is the construction and development of the Freedom Center. Minority businesses and African American communities benefited from the employment and earnings of minorities who worked at the Freedom Center under contracts for construction, development and related operations. More than 27 percent of jobs resulting from the construction of the Freedom Center went to African Americans.

Research indicates that strategies related to economic inclusion often contribute to the development of minority communities which, in turn, positively affect the economic development of the region.