Asian and Hispanic owned the highest number of businesses in the United States among other minority groups, according to 2020 data.
Out of 5,775,258 U.S. firms in all sectors as of 2020, Asian-owned businesses were 612, 194, followed by Hispanic-owned businesses, having 375, 256 firms, says the report from the US Census Bureau says.
Specifically, the report covers business ownership by the minority groups in the United States, which are:
- Hispanic
- Asian
- Black Africa American
- American Indian and Alaska Native
- Native Hawaii and Other Pacific Islander
However, a further dig into which minority owns most US businesses, shows that business ownership among some racial and ethnic groups was concentrated in certain sectors.
It also shows that some minorities have more business founders than others and are more active in some sectors.
How many businesses are in the US?
According to data from the U.S. Department of Commerce, there were a total of 5,775,258 businesses in all sectors in 2020, employing about 129,363,644 workers. They had a total annual payroll of $7.3 trillion.
How many businesses are minority-owned?
Impressively, approximately 20% or 1.2 million businesses are minority-owned, they are employers of labor, employing about 9.9 million workers with an annual payroll of $357.4 billion at the end of 2020.
Here is the number of minority-owned U.S employers of labor, according to Annual Business Survey conducted by the Census Bureau:
- Asian: 612,194
- Hispanic: 375,256
- Black or Africa American: 140,918
- American Indian and Alaska Native: 40,392
- Native Hawaii and Other Pacific Islander: 8,822
How many businesses are Asian-owned?
With over 600K business founders in the US, representing 23.8%, Asian have most businesses among the racial or minority groups.
Most of the Asian businesses are in the Accommodation and Food Services sector in 2020. 145, 714, Asian own more firms in the Accommodation and Food Services industry than the other four minority groups combined. The number of Asian-owned businesses in this sector far outnumbered ownership by other minority groups.
There were 209,151 businesses in the Accommodation and Food Services sector that belong to the minority group:
- Asian:145,714
- Hispanic: 50,231
- Black of Africa American: 8,435
- American Indian and Alaska Native: 3,718
- Native Hawaii and Other Pacific Islander: 1,053
Hispanic-owned businesses
Between 2019 to 2020, Hispanic-owned businesses grew about 8.2%, from 346,836 to 375,256, making up about 6.5% of all businesses in the United States in 2020.
Remarkably, the Hispanic-owned business founders employed about 2.9 million workers in 2020.
The highest number of Hispanic-owned firms was in the Construction; Transportation and Warehousing; Administrative and Support, Waste Management and Remediation Services sectors respectively.
Construction sector:
In the construction sector, Hispanics were a dominant force ahead of other racial or minority groups.
Of all the 102,239 construction firms owned by the minority groups, Hispanic-owned was 62,789; meaning Hispanic owned more in the construction sector than other minority groups combined.
- Hispanic: 62,789 (61.4%)
- Asian: 17,917 (17.5%)
- Black of Africa American: 10,330 (10.1%)
- American Indian and Alaska Native: 9,660 (9.4%)
- Native Hawaii and Other Pacific Islander: 1,543 (1.5%)
Transportation and Warehousing sector:
In 2020, minority groups owned 46,989 firms in the Transportation and Warehousing sector, with Hispanic with the lion’s share of 24,434, followed by Asia (12,664), Black or Africa American (9,581), and Native Hawaii and Other Pacific Islander (310).
Administrative and Support, Waste Management and Remediation Services sectors
- Hispanic: 34,574
- Asian: 14,465
- Black of Africa American: 12,743
- American Indian and Alaska Native: 3,625
- Native Hawaii and Other Pacific Islander: 713
How Many Businesses Are Owned By African Americans?
African American or Black owned 140,918 businesses across all firms in 2021, employing 1.3 million people.
The strength of Black lies in Health Care and Social Assistance (38,819); Professional, Scientific, and Technical Services (19,575); Administrative and Support, Waste Management and Remediation Services (12,743); Construction (10,330); and Transportation and Warehousing (9,581) respectively.
Why this matter?
The U.S population is diverse and the diversity has been a blessing in the area of job creation and opportunities across sectors, thanks to various policies – including grants – of the government to boost small businesses.
Notably, the government is reducing its burden on social security when businesses strive by creating jobs.
Also, the government can up its taxes from businesses, thereby enabling the government to cater for some of the essential services.
We can’t also deny the fact that the diversity of business owners which mirrors the changing profile of the United States’ population.
Between 2010 to 2020, the population of nearly all the ethnic groups in the US had grown except the White alone population, which declined in the 2020 census.
Conclusion:
In summary, Asian have the most businesses in the US than other race or ethnicity groups, Hispanic is the second, while Black or African American is third; American Indian and Alaska Native, and Native Hawaii and Other Pacific Islander fourth and fifth respectively.