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Asians highest revenue generators among minorities in US

Ela Dutt
India Abroad Correspondent in Washington

Minority-owned businesses in the United States grew more than four times as fast as other companies, between 1992 and 1997, increasing from 2.1 million to about 2.8 million firms, according to a report released on Thursday by the Commerce Department's Census Bureau.

While Hispanics owned the largest share of firms owned by minorities, Asian and Pacific Islander-owned firms, a category that includes Asian Indians, reaped the largest share of minority-owned business revenues -- 52 per cent.

Minorities owned 3,039,033 of non-farm businesses in 1997, employed 4,514,699 people and generated revenue totalling $591.3 billion.

Overall, minority-owned firms made up 15 per cent of the nation's businesses and generated 3 per cent of all receipts.

Minority-owned businesses are those owned by African Americans, Hispanics, Asians and Pacific Islanders, or American Indians and Alaska Natives. The vast majority of these firms, 82 per cent or 2.5 million, were sole proprietorships (unincorporated businesses owned by individuals).

The 30 per cent growth rate exceeded the 7 per cent increase for all firms, which jumped from 17.3 million in 1992 to 18.4 million in 1997.

"We are pleased to report that this portrait of the American economy shows rapidly expanding opportunities for minority entrepreneurs and a more diverse universe of small businesses," said Under Secretary for Economic Affairs Kathleen B Cooper on releasing the report.

Ronald N Langston, director of the Commerce Department's Minority Business Development Agency, said, "Today's report clearly indicates minority businesses are growing at a faster rate than businesses overall."

He asserted he would work to empower minority businesses to achieve higher levels of success by directing MBDA to be innovative and focused on entrepreneurship.

Forty-three per cent ($255.9 billion) of all revenues generated by minority-owned businesses were produced by 252,900 C corporations.

C corporations encompass all legally incorporated businesses, except for subchapter S corporations. Subchapter S corporations are those whose shareholders elect to be taxed as individuals rather than as corporations.

California, Texas, New York and Florida, the nation's most populous states and home to nearly half of all minority residents, had the largest number of minority-owned businesses.

These are also the states with the largest concentration of Asian Indians. Men were owners of about 55 per cent of the firms owned by each of the four minority groups.

African Americans had the largest percentage of firms owned by women -- 38 per cent.

Thirty-nine per cent of all minority-owned firms had 1997 receipts of under $10,000; about 3 per cent had sales of $1 million or more.

Average receipts per firm were $194,600 compared with $410,600 for all firms, excluding publicly held corporations and firms (such as mutual companies) whose owners' race or ethnicity could not be determined.

About 1 in 5 of all minority-owned firms had paid employees. More than 4,400 minority-owned firms had 100 or more employees.

Fifty-nine per cent of all minority-owned firms were in the services and retail trade industries, accounting for 43 per cent of all receipts.

The data in the report were collected as part of the 1997 Economic Census from a large sample of non-farm businesses filing tax forms as sole proprietorships, partnerships or any type of corporation with receipts of $1,000 or more in 1997.

The economic census is taken twice a decade in years ending in 2 and 7.

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