In this month’s “5 in Five” podcast, I spoke with Jill Johnson, the Co-Founder and CEO of the Institute for Entrepreneurial Leadership (IFEL). It is an independent, not-for-profit organization that supports inner city economic development through entrepreneurship. We discuss the state of Black-owned businesses and how the pandemic shined a light on issues that were around long before the pandemic.
Below are excerpts from our conversation.
Brian Moran: What is the state of Black-owned businesses in America, and how were they affected by the pandemic?
Jill Johnson: One of the things I want to make abundantly clear is that the challenges that many Black-owned businesses face today did not change during the pandemic. They were the same challenges that existed before the pandemic. And the reason why there was a disproportionate impact on these businesses is because they were struggling so much before.
Most companies that pivoted and survived the last two years were able to do so because they had resources, capital, and people in their networks to help them do it. Many Black-owned businesses were not in that position. They were capital-starved before 2020, and they remain capital-starved now. We saw a loss of over 40% of Black-owned businesses in the country. So, when you ask about the status, Black-owned businesses did not do very well.
Brian: Of the big four obstacles that are affecting business owners today, COVID, supply chain, inflation, and labor issues, are any of them having a bigger impact on Black-owned companies?
Jill: Those issues are so intertwined. Labor issues are part of inflation and supply chain, and they are all compounding. If you take a business that has limited access to capital and add workers who are essentially demanding higher wages as the cost of goods and services that they need goes up, it makes for a perfect storm. I do not know if you can say which one is having a bigger impact because they are all impacting businesses.
Brian: You are a champion of businesses owned by women of color, and you are committed to helping women of color entrepreneurs get connected with influencers and decision-makers. What have the last two years been like for them, and what can we in the small and midsize business community do to help them going forward?
Jill: It is consistent with what we have seen with Black-owned businesses. Women did face the unique challenge of having to take care of children at home during the lockdown period. Imagine a woman business owner where all the pressures are on her. The pandemic was very difficult for many women entrepreneurs. However, it did shine a light on the issues that people of color face, especially Black businesses with a lack of access to capital and women dealing with their unique issues.
Brian: Are there any other silver linings to what happened over the last two years?
Jill: I think it's gotten a lot of people talking who wouldn't have otherwise been talking about these issues. From my vantage point, more people are willing to become immersed in conversations, to ask questions, and to understand that these issues are not made up in our heads. These are real problems that have been going on for decades. I think having more people listening has been a tremendous part of the silver lining.
Brian: Thank you, Jill, for taking time today to join us on the “5 in Five” podcast. We appreciate your insights and advice on the state of Black-owned businesses in America.
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