Black-owned businesses can help close the racial wealth gap in the United States, a report has found.
The “Gather Against the Gap” report marked a significant step towards addressing the racial wealth gap that critically impacts Black Americans.
The Racial Wealth Gap
The data found a $10 trillion racial wealth gap in the United States.
The gap was illustrated by the median wealth of Black households at $20,000, in contrast to $180,000 for white households.
This wealth disparity, coupled with an employment and income gap, significantly hinders the economic progress and stability of Black communities.
Three Strategies To Close The Gap
Three primary strategies emerged from the discussions.
First, advancing business diversity through corporate procurement spend can significantly impact growth in diverse communities, particularly those locally owned.
This approach not only supports the businesses but also the communities they serve.
“Small businesses create jobs and hire locally, and because we don’t have the volume of Black-owned businesses, we’re missing out on reducing the racial wealth gap,” Dwight Hutchins, a key architect of the new report, told Yahoo Finance.
Second, the role of institutional investors was underscored.
These entities can leverage their capital to generate financial returns and social impact, thereby driving growth and employment in Black communities.
Finally, the conference highlighted the critical role of private equity in scaling impact-focused businesses.
Additional Support
Innovative models and network support from private equity partners can substantially aid in growing businesses in diverse communities.
The conference underscored the importance of corporate leaders tracking diversity metrics across personnel, purchasing, and philanthropy in their companies.
This approach ensures a sustained and comprehensive effort toward narrowing the racial wealth gap.
Despite the enormity of the challenge, the event concluded on an optimistic note, believing that the discussions and strategies outlined would lead to actionable plans and positive outcomes.
