Administration grade on small business a C-minus
In the midst of a recession which has hiked unemployment, federal agencies are only spending just over 17 percent with small businesses in general, instead of the mandatory 23 percent minimum set by Congress, and less than two percent with black-owned companies.
On Friday, June 3, the Bureau of Labor Statistics announced that black unemployment has risen to 16.2 percent; 17.5 percent for black men and 13.4 percent for black women. For black teens 16 to 19, the official unemployment rate is 40.7 percent.
Out of 17.75 million blacks in the civilian labor force, 2.88 million were unemployed in May.
In annual averages for 2010, black unemployment rose for every educational level.
For instance, the rate rose from 21.3 to 22.5 for the 3.7 million without a high school diploma.
Among the 7.9 million black workers with a high school diploma, the unemployment rate went up from 14 to 15.8 percent.
About 4.6 million black workers have some college experience. Their unemployment rate rose in 2010 from 12.1 to 13.2 percent. The 2.2 million with an associate degree saw an increase from 10.3 to 10.8 percent; and the 4.7 million with a bachelor's degree or higher had their unemployment ratio go up from 7.3 to 7.8 percent.
Blackmoney.com editor John William Templeton, author of the annual study since 2004, notes that there has not been a signiificant improvement since last year, when Where's Our Stimulus: State of Black Business, seventh edition, reported than less than two percent of American Recovery and Reinvestment Act contracts had gone to black companies. Even smaller ratios were achieved on the oil spill recovery.
"When the President met with the Congressional Black Caucus recently to talk about jobs, increasing spending with black businesses was not on the table," said Templeton. "The two million black owned companies are seven percent of all enterprises. Reaching a procurement level of five percent by National Black Business Month in August would bring an additional $12 billion of revenues, or a ten percent increase in the total income of black businesses."
Since 2004, the State of Black Business report has evaluated state governments on their climate for black companies by using a nine factor black business affinity index. This year's report is the first to provide a rating for the entire federal government. One of the key factors is executive leadership. Templeton called on the President to redouble efforts during National Small Business Week to increase procurement with black companies. Currently, 53 percent of the $500 billion in federal contracts goes to the 100 largest contractors.
"The big plus for the Obama administration is the transparency of reporting," said Templeton. "We've now got several years of data to make some valid comparisons.
Templeton, co-founder of National Black Business Month with Frederick E. Jordan, P.E., says the best way to increase procurement is by providing research and development, particularly Small Business Innovative Research (SBIR) contracts to black-owned manufacturers.
On June 18, he is curating an exhibition on black manufacturing advances called Freedom Riders of the Cutting Edge at The Tech Museum of Innovation in San Jose. The days activities will also include the premiere of A Great Day in Gaming, a documentary on Gerald A. Lawson, the late inventor of the first cartridge video game console; panels of early black industrial pioneers from Silicon Valley and current game developers and an innovation competition among new inventors and ventures.
