FOR IMMEDIATE RELEASE
PHILADELPHIA (August 12, 2020) – As Philadelphia faces the challenge of rebounding from a severe recession and historic levels of unemployment amid the current health crisis, a new Center City District (CCD) report seeks to shed light on the importance of business density in providing employment opportunities. The report also specifically compares Philadelphia to four other East Coast cities and examines the number of Black-owned firms in relationship to the total number of Black residents. The findings show that among our comparison cities, Philadelphia has both the lowest number of Black-owned firms in relation to Black residents and the lowest number of businesses in relation to overall population.
Using data from the U.S. Census Bureau’s Annual Business Survey (ABS) from 2018, the most recent year for which data is available, CCD analyzed the total number of businesses in Philadelphia and the number of Black, Hispanic, Asian and white owned firms and compared the data to four other East Coast cities: Boston, New York, Washington and Atlanta.
Given the differences in geographic size and population among these cities, we created a measure of “business density” – the ratio between the number of businesses in a city and its population – as a shorthand estimate of opportunity: the higher the ratio of businesses to residents, the more potential opportunity should exist within the boundaries of the city.
In 2017, Philadelphia had 12.1 businesses per 1,000 residents, less than half the business density of Atlanta, where the ratio was 24.6 per 1,000 residents. New York had a business density of 22.4, Boston had 18.6 and Washington had 17.1. In the nation as a whole, there were 16.8 businesses per 1,000 residents.
“Our problem is not simply slow job growth. Even before this crisis, we seriously lagged other cities in the formation of businesses that produce jobs,” CCD President and CEO Paul R. Levy said. While education and work-readiness are essential components of any strategy to reduce poverty, it is paramount that we focus more on creating greater business density, more businesses in relationship to residents, and in particular, more Black-owned businesses in relationship to the city’s Black population.”
Locally, there are 1.8 Black-owned firms per 1,000 Black residents, just 14.6% of the overall number of firms per 1,000 residents. The ratio is 16% nationally; it is 15.4% in New York, 19.1% in Atlanta, and 29.4% in Washington.
When Philadelphia’s overall low-level of business density is combined with its large disparity between Black and non-Black businesses per capita, the result is that the number of Black businesses per Black resident is by far the lowest of the five cities. If Philadelphia had as many Black-owned businesses for every 1,000 Black residents as Washington D.C., the number would nearly triple, rising from 1,174 to 3,329.
“The pandemic has caused a huge spike in unemployment across the nation. To reduce unemployment and poverty as the health crisis ends and recovery begins, Philadelphia will require far more than a return to the status quo before Covid-19,” Levy said. “We need a sustained effort to increase the number of Black-owned and minority-owned businesses as well as much greater attention to business growth overall.”
To download the eight-page report, visit- Getting More Philadelphians Back to Work: Business Density and the Role of Black and Minority Owned Businesses.
October 9, 2020 | Want to grow more Black businesses in Philadelphia? Start with advocacy, funding and social capital, Technical.ly Philadelphia
October 6, 2020 | Access to capital is biggest hurdle for Philadelphia’s Black-owned businesses, leaders say, Philadelphia Business Journal
September 30, 2020 | U.S. Black Chambers, Inc. president says Philadelphia Black-owned businesses need help, The Philadelphia Tribune
August 31, 2020 | African-American Chamber chair ‘optimistic’ as equity initiatives aim to boost Philadelphia’s Black-owned businesses, Philadelphia Business Journal
August 31, 2020 | Meet the 2.5 Percent: Philly’s Black-Owned Enterprises and Early Stage Startups, Philadelphia magazine
August 24, 2020 | While rebounding from this recession, let’s focus on Black-owned business, Center City District says, Technical.ly Philadelphia
August 23, 2020 | Philly has fewer businesses, large racial disparity, Metro Philly
August 17, 2020 | Report: Racial disparities prevalent in job opportunities in Philly, The Philadelphia Tribune
August 14, 2020 | Philly has fewer businesses per capita than other big East Coast cities, report says, The Philadelphia Inquirer
Center City District, a private-sector organization dedicated to making Center City Philadelphia clean, safe and attractive, is committed to maintaining Center City’s competitive edge as a regional employment center, a quality place to live, and a premier regional destination for dining, shopping and cultural attractions. Find us at www.centercityphila.org and on Facebook and Twitter.