March 27, 2025 Story by: Editor
Following the initial economic disruptions caused by the COVID-19 pandemic, entrepreneurship in the U.S. experienced a remarkable resurgence, with business applications skyrocketing since 2020. Data from the Census Bureau reveals that national business applications, which remained relatively stable between 2017 and 2019, saw a dramatic rise from 235,695 in April 2020 to 546,415 by July 2020. This upward trend continued through 2022, with 423,977 applications recorded in December of that year.
A significant portion of this growth stemmed from Black-owned employer businesses—firms with at least one employee. Between 2017 and 2022, the number of such businesses owned by Black Americans surged by 56.9%. Of the approximately 132,000 new employer businesses launched during this period, Black entrepreneurs accounted for more than half, establishing at least 70,000 new firms.
This expansion not only fosters a more inclusive business landscape but also strengthens the national economy. In 2022—the latest year for which data is available—Black-owned businesses contributed $212 billion in revenue, provided jobs for an average of eight employees per firm, and collectively paid over $61 billion in salaries. Other minority business owners also played a crucial role in economic recovery, with minority-owned employer firms increasing by over 334,000 between 2017 and 2022, generating $738 billion in revenue and creating 1.9 million additional jobs compared to 2017.
As part of the annual Path to 15|55 initiative, this report examines the trends shaping a diverse and thriving economy. By analyzing data from the Census Bureau’s American Community Survey and Nonemployer Statistics, it identifies key sectors and metro areas fueling this growth. Additionally, the report highlights ongoing racial disparities in business ownership and compares the percentage of firms owned by different racial and ethnic groups with their share of the overall population—shedding light on the progress needed to achieve equity.
Key Findings:
- The proportion of employer businesses owned by Black Americans rose from 2.2% in 2017 to 3.3% in 2022, yet remains significantly below their 14.4% share of the U.S. population.
- Black women-led businesses saw a 71.6% increase since 2017.
- Black-owned employer businesses in the transportation and warehousing sector, as well as real estate, rental, and leasing, doubled during this period.
- The health care and social services sector continues to have the highest number of Black-owned employer firms, with Black ownership in this industry increasing from 6% to 7.5% between 2017 and 2022.
- The South and East saw the strongest growth in Black business ownership, with cities like Reno, NV; Minneapolis-Saint Paul-Bloomington, MN-WI; and Austin-Round Rock-San Marcos, TX witnessing their number of Black-owned firms more than double.
Black Business Growth Continues, But Parity Remains Elusive
Between 2017 and 2022, the number of Black-owned employer businesses grew by 56.9%, adding 70,581 new firms (see Figure 1), with an average annual growth rate of 9.7%. From 2021 to 2022 alone, the number of Black-owned employer businesses increased by 20.8%, reaching a total of 194,585 firms nationwide. Despite this progress, Black entrepreneurs still own only 3.3% of employer businesses—far below their 14.4% share of the U.S. population.
Compared with other racial and ethnic groups, Black Americans have the third-lowest representation in employer business ownership. Native Hawaiian and Other Pacific Islander entrepreneurs hold the lowest share, representing just 0.2% of employer business owners despite making up 0.5% of the population. They are followed by American Indian and Alaska Native business owners, who constitute 0.8% of employer firms while accounting for 2% of the population.
Hispanic or Latino business owners also remain underrepresented, holding 7.9% of employer businesses despite comprising 18.7% of the population. In contrast, white and Asian American entrepreneurs have higher ownership shares relative to their population size, at 81.1% and 11.1%, respectively.
All minority racial and ethnic groups experienced an increase in employer business ownership between 2017 and 2022. The number of Asian American-owned employer businesses rose by 17.1%, while Native Hawaiian and Pacific Islander-owned businesses expanded by 39.5%. Hispanic or Latino-owned firms also grew significantly, increasing by 44.4%. Meanwhile, white-owned employer businesses saw a slight decline of less than 1%, although their total revenue, employment, and payroll increased.
These trends indicate that the growth of minority-owned businesses does not come at the expense of white business owners. If economic expansion were a zero-sum game across racial groups, white-owned businesses would have declined by 7%—10 times the observed rate—along with reductions in revenue, employment, and payroll. Instead, the rise of Black-owned businesses and firms owned by other minority groups contributed to the country’s broader economic recovery post-pandemic.
Minority-Owned Businesses See Growth in Revenue, Employment, and Payroll
In addition to increasing in number, minority-owned businesses have also expanded their financial and workforce contributions. In 2022, Black-owned employer businesses generated 65.7% more revenue, hired 34.6% more employees, and paid 69.5% more in payroll compared to 2017. These growth rates exceeded those of all other racial or ethnic groups except for American Indian and Alaska Native business owners, whose revenue surged by over 100%, while employees and payroll grew by more than 50%.
This rapid growth may be attributed to increased federal investments in Native communities under the Biden administration, as well as the necessity for entrepreneurship in reservations and areas with limited job opportunities. Additionally, shifts in Census Bureau data practices and a rise in self-identification among Native Americans may have influenced these numbers.
Persistent Gender Gap in Black Business Ownership
From 2017 to 2022, Black women-owned employer businesses grew by 71.6%—outpacing overall Black-owned and female-owned business growth rates.
Despite this rapid growth, Black men still own a greater share of Black employer businesses. Among the roughly 70,000 new Black-owned employer businesses established since 2017, fewer than half—approximately 32,000—were owned by women, despite Black women comprising 51.8% of the U.S. Black population. While the high proportional growth rate of Black women-led businesses is a positive sign, the gender gap in business ownership remains.
Black-Owned Businesses See Sharp Growth in Certain Industries
Health care and social assistance remains the leading industry for Black-owned employer firms, maintaining its position since at least 2017. However, other industries have also experienced notable expansion. For instance, Black-owned businesses in the transportation and warehousing sector surged by nearly 150% between 2017 and 2022, with Black employers’ share in the industry increasing from 3.8% to 7.9%. The real estate, rental, and leasing sector also saw significant growth, with Black-owned employer firms doubling during this period, making it the ninth-largest industry for Black entrepreneurs in 2022.
Source: Brookings
