Leading members of the U.S. House of Representatives released a report this week that examines the state of Hispanic entrepreneurship and businesses ownership in the United States.
The report – a joint effort by the Congressional Joint Economic Committee (JEC), the Congressional Hispanic Caucus (CHC), and the House Small Business Committee – finds that there are nearly five million Hispanic-owned businesses in the US alone, which contribute more than $800 billion each year to the American economy.
In the last decade, the number of Hispanic business owners increased 34 percent, with nearly one in four new businesses started by Hispanic entrepreneurs. This makes Hispanic-owned small businesses the fastest-growing segment of U.S. small businesses. About two percent of the workforce is now employed in Hispanic-owned employer businesses.
“Hispanic businesses drive economic growth and are integral to U.S. economic dynamism,” Rep. Don Beyer (D-VA), chair of the JEC, said. “Growing at a pace that is faster than the national average, Hispanic-owned businesses serve as an engine of job creation, which is especially vital in this moment to fuel our nation’s economic recovery. But while many Hispanic-owned small businesses stayed open during the pandemic to help Americans access the goods and services they desperately needed, many of these enterprises faced barriers to accessing economic relief in the immediate fallout from the pandemic and remain financially precarious.”
As Beyer noted, the report found that structural barriers leave Hispanic business owners more vulnerable to economic shocks than their white counterparts. As a result, the impact of the coronavirus recession was especially pronounced among Hispanic-owned businesses. In March 2020, more than four out of five Hispanic business owners reported a large negative impact from the pandemic and its economic effects. In the immediate fallout, Hispanic-owned businesses faced barriers to accessing emergency relief.
“Despite their significant contributions, Hispanic businesses were less likely to have access to federal grants and business loans during the pandemic, which caused some to permanently shut down,” Rep. Raul Ruiz (D-CA), head of the Congressional Hispanic Caucus (CHC), said. “As the JEC report demonstrates, equal opportunity to apply for business loans does not always mean equal access to business loans. The CHC is committed to advancing policies, such as increased access to capital and federal contracts to help Hispanic businesses across the nation succeed as we recover from the pandemic.”
Investments in American businesses and families, like those included in President Joe Biden’s Build Back Better agenda, will help level the playing field for small businesses, U.S. Rep. Nydia Velázquez (D-NY), chair of the House Small Business Committee, said.
“Fixing the inequities for Hispanic small businesses will take bold and deliberate action by Congress. That’s why House Democrats are working diligently to pass the Build Back Better agenda, which constitutes a generational investment in small businesses and will help level the playing field for underserved small firms,” Velázquez.