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Black
businesses
hit hard
by
COVID-19
fight to
stay
afloat
By
Kat
Stafford
apnews.com
Detroit
-
Stephanie
Byrd
agonized
over
temporarily
laying
off
nearly
the
entire
staff at
her
family’s
trio of
Detroit
businesses
when the
coronavirus
pandemic
hit.
But
she’s
not just
concerned
about
the
impact
on their
bottom
line.
She’s
worried
other
black-owned
businesses
will
struggle
to
withstand
another
wave of
economic
uncertainty,
following
decades
of
inequity
that
made it
hard for
many to
flourish
in the
first
place.
“Most of
the
people I
know who
have
businesses
and are
black
are
terrified
right
now,”
said
Byrd,
whose
family
owns
Flood’s
Bar &
Grille,
The
Block
restaurant
and the
city’s
Garden
Theater.
“There
could be
a new
wave of
black
businesses
that are
able to
reinvent
themselves
post-pandemic,
but
black
businesses
could
also be
wiped
out for
the most
part
within a
black
city.
What
would it
look
like
without
black-owned
businesses?”
COVID-19
has
disproportionately
impacted
black
Americans,
infecting
and
killing
them at
higher
rates
across
the
nation.
But
experts
say the
pandemic
has also
exacerbated
existing
economic
disparities
and
raised
fresh
concerns
about
the
survival
of black
businesses,
many of
which
have
been the
backbone
of
cities
like
Detroit
and
Atlanta
for
years.
They
also
worry
the
pandemic
could
widen
the
existing
black
wealth
gap.
According
to the
Federal
Reserve’s
2016
Survey
of
Consumer
Finance,
the
median
white
family
net
worth of
$171,000
is about
10 times
greater
than
that of
a black
family’s,
which is
$17,150.
Black
businesses
historically
have
struggled
to gain
access
to
financing
due to
discriminatory
lending
practices
and a
lack of
relationships
with big
banks.
But
civil
rights
leaders
and
historians
say
their
struggles
are also
rooted
in the
simmering
effects
of
racism
and Jim
Crow-era
laws
that
enforced
racial
segregation
and
denied
black
people
equal
opportunities.
“Structural
racism
has
created
an
environment
where
black
businesses
are
starved
for
capital,”
said
Marc
Morial,
president
and CEO
of the
National
Urban
League,
a civil
rights
and
urban
advocacy
organization.
Juliet
Walker,
founder
of
University
of Texas
at
Austin’s
Center
of Black
Business,
History,
Entrepreneurship
and
Technology,
said
black
enterprises
existed
even
prior to
the
Civil
War.
They
especially
thrived
during a
“golden
age”
from
1900 to
1930 in
areas
such as
Tulsa,
Oklahoma’s
Greenwood
District,
known as
Black
Wall
Street.
But
those
moments
were
short-lived.
Tulsa’s
once-thriving
African
American
business
community
was
destroyed
in 1921
when a
racist
white
mob
killed
hundreds
of black
residents.
Black
residents
attempted
to
rebuild
in the
decades
that
followed,
only to
see
their
work
erased
during
urban
renewal
of the
1960’s.
“Blacks
were
able to
establish
successful
business
enterprises
during
the age
of
slavery
where
black
people
had no
political
or
economic
rights,”
Walker
said.
“Yet,
here we
are
today
and the
position
of
blacks
in
business
differs
very
little
from the
position
of
blacks
during
the age
of
slavery.”
Detroit
was once
home to
Black
Bottom
and
Paradise
Valley —
two
predominantly
African
American
neighborhoods,
the
latter
of which
had more
than 350
black-owned
businesses
and a
music
scene
that
drew the
likes of
Louis
Armstrong
and
Billie
Holiday.
Both
were
wiped
out in
the
1950’s
and
1960’s,
when a
nearly
all-white
city
government
allowed
the
construction
of a
freeway
system
through
the
heart of
the
neighborhoods.
Jamon
Jordan,
a black
historian
based in
Detroit,
said the
pandemic
could
have a
similar
crushing
impact
on black
American
businesses.
“Each
time
this
happens,
the
amount
of
energy
and time
it takes
to
recreate
something
that’s
even as
simple
as what
was
destroyed
is
monumental,”
Jordan
said.
“Even
though
the
coronavirus
isn’t
the
fault of
a single
person
or
leader,
the
impact
of the
devastation
on the
African
American
community
is part
of a
long
legacy
of
discrimination
and
segregation
for
black
people
and
black
businesses.”
Some
black
business
owners
have
also
expressed
frustration
with the
Small
Business
Administration’s
$659
billion
Personal
Paycheck
Protection
Program,
which
was
meant to
provide
small
businesses
with
loans to
keep
employees
on their
payrolls
during
the
COVID-19
crisis.
The
initial
round of
funding
ran out
in just
13 days,
with
complaints
over lag
times
and
confusion
over the
application
process.
However,
the SBA
made
improvements
in its
second
round
and more
than
$100
billion
remains
available.
But
the
Center
for
Responsible
Lending,
a
nonprofit
group
that
works to
end
predatory
lending
practices
aimed at
low-income
communities,
said
challenges
remain.
“This is
just a
new
public
health
crisis
and
economic
crisis
that is
coming
after so
many
decades
and
centuries
of
structural
inequality,”
said
Ashley
Harrington,
the
center’s
federal
advocacy
director
and
senior
counsel.
National
Business
League
President
and CEO
Ken
Harris
said his
team has
been
fielding
hundreds
of
questions
from
members
who are
struggling
to
survive.
The
league,
founded
in 1900
by
Booker
T.
Washington,
is
launching
its own
$1.8
million
digital
platform
to help
business
owners
gain
access
to
funding.
“It’s
going to
be a
rebuilding
process
and
we’re
going to
have to
focus on
economic
recovery,”
Harris
said.
Pinky
Cole,
the
African
American
owner of
the
popular
Atlanta-area
Slutty
Vegan
restaurants
and food
trucks,
said
she’s
been
able to
shift
toward
being a
carryout
business
but
others
haven’t
been so
lucky.
Through
her
Pinky
Cole
Foundation,
she’s
been
paying
the rent
for
small
businesses
that are
struggling.
“Black-owned
businesses,
we’ve
always
landed
at the
bottom
of the
totem
pole as
it
relates
to
resources,”
Cole
said.
“We put
our
blood,
sweat
and
tears
into
these
businesses
and
everything
you’ve
worked
hard for
can be
lost in
a matter
of
days.”
Several
business
companies
and
entrepreneurs,
including
Facebook,
Magic
Johnson
and Mark
Cuban,
the
billionaire
owner of
the
Dallas
Mavericks,
have
announced
plans to
help
businesses
owned by
people
of
color,
but some
worry
the
assistance
might
come too
late.
The
Michigan
Minority
Supplier
Development
Council,
which
represents
minority-owned
firms
that
serve
the
country’s
automotive
industry,
took
matters
into its
own
hands
and
worked
to
identify
lenders
willing
to help
small
firms.
“The
difference
for
minority
businesses
is they
can’t
walk
into a
bank and
get the
same
treatment
and if
anything,
I
believe
COVID-19
has
exposed
much of
our
disparity,”
said
Michelle
Sourie
Robinson,
the
council’s
president
and CEO.
OneUnited
Bank,
the
nation’s
largest
black-owned
bank,
announced
its
participation
in the
Small
Business
Administration
program
in April
to help
minority-owned
businesses
gain
access
to the
stimulus
funding.
“A
lot of
our
customers
as well
as
businesses
who are
in the
community,
I’ve
counted
on one
hand the
number
that
actually
applied
and got
funded,”
said
Teri
Williams,
president
and
chief
operating
officer.
“Our
community
was
really
getting
shut
out.”
On
Thursday,
the SBA
announced
it was
setting
aside
$10
billion
exclusively
for
Community
Development
Financial
Institutions,
which
work to
expand
economic
opportunity
in
minority
and
other
under-served
communities.
Bernard
Kanjoma
and his
fiancée
Jessika-Katherine
Naranjo
Colina,
who
co-own
the
graphic
design
and
marketing
firm
Naranjo
Designs,
said
they
received
an
$8,000
loan May
5.
Kanjoma,
who
emigrated
to the
United
States
from
Malawi,
said
their
12-person
team has
seen an
80% drop
in
business
but
they’re
identifying
creative
ways to
weather
the
crisis.
“We
have
been
heavily
impacted
and it’s
been
challenging
but I
felt
like all
the
hardships
that I
went
through
with
immigration
and
everything
else to
be where
I am
now,
this is
something
that is
just
going to
blow
over,”
Kanjoma
said.
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