Hispanic-owned businesses are a hotbed of job growth in the United States, according to a new report.
Employment at these firms grew by 26 percent from 1.5 million to 1.9 million over the five-year period from 2002 to 2007, significantly higher than that of non-minority owned firms, according to a report released by the U.S. Commerce Department’s Minority Business Development Agency (MBDA).
The number of Hispanic-owned firms also outpaced the growth of non-minority-owned businesses , jumping by 44 percent over the same period from 1.6 million to 2.3 million. In spite of this growth, though, Hispanic businesses are underrepresented in the American economy, the report showed. While Hispanics now represent 13 percent of the adult population, Hispanic businesses still account for only 9 percent of all classifiable businesses.
Their average annual gross receipts also lag behind those of non-minority-owned firms. Though average gross receipts for Hispanic-owned firms increased from $141,000 in 2002 to $152,700 in 2007, they were still well below gross receipts for non-minority-owned firms, which had average gross receipts of $490,000.
“If the number of Hispanic businesses was representative of the adult Hispanic population in America there would be 3.4 million Hispanic businesses generating $1.4 trillion in gross receipts paying 7.5 million workers,” said David A. Hinson, MBDA’s national director. “There is still progress to be made in the growth of minority businesses that would give them an even greater impact on our economy.”
Approximately 44,000 Hispanic-owned businesses have revenues of more than $1 million and account for $224 million in gross receipts and the employment of 1.2 million workers.
“These firms have business models that are helping to facilitate growth , and we need to share the best practices of these firms with the rest of the minority business community,” Hinton said.