Business Ownership by Race

Definition

Ratio of the business ownership rate of white, non-Hispanic workers to workers of color (Black or African-American; American Indian and Native Alaskan; Asian; Native Hawaiian and other Pacific Islander; Hispanic or Latino), 2007. The business ownership rate is defined as the number of businesses in which white workers or workers of color own 50% or more of the equity, interest or stock of the business as a percentage of white workers or workers of color. 

Calculated by dividing the higher value by the lower value, i.e., the business ownership rate of white workers divided by workers of color.

A ratio of 1 indicates perfect equality; the higher the ratio, the greater the inequality. For example, the business ownership rate of white workers in South Carolina is 2.5 times higher than for workers or color.

Description

This measure describes the disparity in business ownership between white workers and workers of color. Business ownership is a fundamental engine for wealth creation, and is more prevalent for white workers than it is for workers of color. For example, in North Dakota, white workers own businesses at a rate more than three times higher than workers of color.

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Business Ownership by Race

State	Percent of White Labor Force Owning Firms (%)	Percent of People of Color in Labor Force Owning Firms (%)	Ratio	Rank
United States	19.6%	12.9%	1.51
Alabama	20.3%	10.7%	1.90	36
Alaska	21.4%	17.3%	1.24	3
Arizona	20.9%	8.6%	2.42	48
Arkansas 1	18.5%	7.8%	2.37	45
California	25.0%	13.5%	1.85	33
Colorado	22.6%	11.7%	1.94	37
Connecticut	19.5%	9.8%	1.99	38
Delaware	18.8%	9.0%	2.09	41
District of Columbia	22.0%	12.4%	1.78	28
Florida	22.4%	19.7%	1.14	2
Georgia	21.5%	13.7%	1.57	19
Hawaii	39.2%	14.0%	2.81	50
Idaho	20.8%	11.7%	1.79	29
Illinois	19.1%	11.7%	1.63	23
Indiana	15.0%	9.6%	1.56	18
Iowa	16.2%	7.2%	2.26	44
Kansas	17.0%	9.3%	1.83	32
Kentucky	17.0%	9.6%	1.77	27
Louisiana	20.9%	13.7%	1.52	15
Maine	20.8%	15.5%	1.34	5
Maryland	19.7%	13.4%	1.47	10
Massachusetts	18.7%	12.2%	1.53	16
Michigan	16.4%	12.9%	1.27	4
Minnesota	17.7%	9.8%	1.81	31
Mississippi	20.3%	9.3%	2.19	43
Missouri	16.9%	10.4%	1.63	22
Montana	22.1%	16.1%	1.37	7
Nebraska	16.8%	7.0%	2.39	46
Nevada	20.6%	10.1%	2.04	40
New Hampshire	18.2%	11.4%	1.59	20
New Jersey	20.4%	10.9%	1.87	34
New Mexico	22.5%	11.9%	1.89	35
New York	22.9%	15.9%	1.44	9
North Carolina	20.5%	9.6%	2.14	42
North Dakota	17.2%	5.4%	3.21	51
Ohio	15.5%	10.4%	1.49	13
Oklahoma	21.8%	12.1%	1.80	30
Oregon	18.7%	12.2%	1.54	17
Pennsylvania	15.8%	11.7%	1.35	6
Rhode Island	17.2%	10.7%	1.61	21
South Carolina	20.9%	8.3%	2.53	49
South Dakota	17.3%	11.6%	1.48	12
Tennessee	20.2%	10.0%	2.03	39
Texas	23.9%	13.8%	1.73	25
Utah	20.5%	8.5%	2.40	47
Vermont	21.2%	15.0%	1.41	8
Virginia	17.1%	11.3%	1.51	14
Washington	17.4%	11.9%	1.47	11
West Virginia	14.2%	13.5%	1.05	1
Wisconsin	14.5%	8.5%	1.70	24
Wyoming	20.9%	11.9%	1.75	26

Source

Survey of Business Owners. Washington, DC: U.S. Department of Commerce, Census Bureau, 2007. 

Current Population Survey, Washington, DC: U.S. Department of Commerce, Census Bureau, 2007. Data calculated by CFED using the CPS Table Creator.