National Black Business Month: Celebrating the Value of Black-Owned Businesses

Since 2004, August has been known as National Black Business Month, highlighting the distinct needs and value of Black-owned businesses in America. Like much of Black history, the history of Black-owned business in this country is a study in dogged determination. As we roll into another celebration of Black businesses, we find a rapidly expanding segment of the small business community that still yet has room to grow.

According to the U.S. Census Bureau’s Annual Business Survey in 2020, there were an estimated 140,918 US companies with majority Black ownership. That number represented a nearly 15% increase from 2017. New data from a subsequent survey conducted in 2022 showed continued growth for Black-owned businesses. That survey showed that there were an estimated 161,031 Black or African American-owned businesses with $183.3 billion in annual receipts, 1.4 million employees, and about $53.6 billion in annual payroll.

In 2020, the greatest number and share of Black-owned businesses were in the healthcare and social assistance sector (i.e., psychology, rehabilitation, and social work fields). That trend continued to hold as the updated data showed that about 45,015 (28%) of Black-owned businesses continued to be in the same sector.

The recent growth spurt is being led, in large part, by Black women. From 2017 to 2020, the number of employer businesses owned by Black women rose to over 50,000, making up 32.7% of all Black-owned businesses and representing an increase of 1.41 percentage points. Interestingly, nearly 40% of Black women business owners have an advanced degree, including almost 20% with master’s degrees — that’s more than 10 points higher than the national average!

Despite the continued growth and upbeat news, the number of Black-owned businesses continues to lag behind those of other groups. The share of Black-owned employer businesses (those with at least one employee) is disproportionately low (2.7%) as compared to the Black portion of the U.S. population (14.4%). In comparison, white Americans owned 82% of employer businesses and made up 72.5% of the population. Asian Americans owned 10.9% of employer businesses and made up 6.3% of the population. To close that gap, Black-owned businesses would have to grow at an even greater pace than what we’re currently seeing. It should also be noted that sole proprietorships make up a disproportionately high share of Black-owned businesses overall at 96.3%, which is more than any other group.

For its part, TriNet is helping businesses—Black-owned and others—by increasing access to and awareness of grants, programs, and other resources available to Historically Underutilized Businesses through its website. We encourage entrepreneurs and SMB leaders to explore these resources TriNet has pulled together, connect with relevant programs, and take advantage of the support available to prepare for potential impacts ahead. Together, we can create a more inclusive and thriving entrepreneurial landscape.

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