Small Business Growth in the USA Fastest Among Latinos

Despite entrenched racism that results in lower incomes and more hoops to jump through to get small business loans, Latino business owners are the fastest group of entrepreneurs today in the United States. Throughout the last decade, the community of Latino business owners expanded by an amazing 34%. That is especially impressive when we compare that growth to the 1% growth of all business owners in the USA. The trend is likely to continue as more Latinos are applying for small business loans to either start or expand their businesses.

The data was analyzed by researchers at Stanford University. Their 2019 study, based on 2017 data, found that about 60 million Latinos in the US make up about $2.3 trillion in economic activity combined, which is the equivalent of the eighth largest economy in the world. By the end of 2020 projections declare that Latinos will make up 30% of the total US population. That means the Latino contribution is poised to explode.

Businesses owned by Latinos employ over 3 million workers, so says the 2019 State of Latino Entrepreneurship report by the Stanford Latino Entrepreneurship Initiative (SLEI). When everything is accounted for, Latino-owned businesses make up about 4% of all US business revenues and 5.5% of all US employment.

Considering the discrimination Latinos face in the US, those supporting this business community say that if Latinos were given a decent chance, they would be able to grow their part of the US economy even more. The problem today is that the “opportunity gap between Latinos or Hispanics and their white, business-owning counterparts is wide.
“Wealth is the missing ingredient in the Latino community,”

said Jerry Porras, a professor of organizational behavior and change emeritus at Stanford Business School, co-founder of the Latino Business Action Network, a non-profit out of Stanford University focused on empowering Latino business owners, and co-director of SLEI.

“If we could add more wealth, people would consume more and grow the economy. How do we get more wealth? Grow businesses.”

“It’s a synergistic process,” said Porras. “In the long term, it will benefit the whole country.”

James Cannon

About James Cannon

James Cannon is an experienced hedge fund analyst. He has served on the advisory boards for various different Fortune 500 companies as well as serving as an adjunct professor of finance. James Cannon has written for a variety of Financial Magazines both on and off line. Contact James at james[at]businessdistrict.com