60,000 Black-owned businesses would end Black unemployment

 By Lincoln DePradine

From left: Dr. C. Justine Pierre, MPP David Smith & Sephton Spence

Unemployment and underemployment have been a perennial, difficult problem in Canada’s Black community. One member of the conservative government of Ontario Premier Doug Ford has been told that increasing the number of Black-owned businesses is a solution to the problem.

“We need 60,000 Black businesses in Canada by 2028, with an average of five employees. If we have 60,000 businesses, we could have almost perfect employment,’’ said Dr. C. Justine Pierre, who took that message to junior minister David Smith at a recent meeting.

Pierre, a labour market researcher and statistician, is director of Dunn, Pierre, Barnett & Company Canada Ltd.

Last year, the company released the findings of a survey – Canada’s first-ever “Black Labour Market Needs Assessment’’ – that it conducted on behalf of the Afro-Canadian Business Network.

Among the survey’s findings was that “Black-owned businesses are predominantly shut out of many of the country’s important financial, economic and industrial activities’’.

It identified the need for training of Black entrepreneurs in the areas of customer service, business management, and adherence to acceptable business standards.

The company called on the federal and provincial governments to promote and implement a Black Labour Market Needs Assessment (BLMNA), warning that “if nothing is done, there will be little or no change, and we will most likely be in the same situation ten years from now.’’

After the 2020 police killing in the United States of African-American George Floyd, the Canadian government and major financial institutions here launched programs allowing easier access to capital for Black business entrepreneurs.

One of the programs of the feds was the Black Entrepreneurship Loan Fund. It provides loans of up to $250,000 and is administered by the Federation of African Canadian Economics, with $130-million in credit from the Business Development Bank of Canada.

Another program, Supporting Black Canadian Communities Initiative (SBCCI), provides up to $25 million over five years to help organizations with such things as research and workplace improvement.

Commercial banks launched Black entrepreneur programs, including one at CIBC that provides loans of up to $250,000 for equipment, leasehold improvements and working capital.

According to CIBC, it has approved $6.5 million of the $13 million it budgeted for the program. It has also provided $2 million to the Black Opportunity Fund for the charity to spend on grants and training for African-Canadian entrepreneurs, who were declined or not yet ready for the loans.

A major concern for all the programs is how long they will continue, with many of them set to expire in 2024 or 2025.

“It was shocking to people,’’ said Pierre, commenting on an SBCCI meeting at Tropicana, where he reported on the BLMNA data and on what’s known as the business-to-population ratio (BPR).

Canada’s Black population is estimated at 1.5 million. According to Pierre, as of July 2022, “the Black business population was estimated at 27,640 businesses’’; and, 86 percent of all Black businesses in Canada has less than three employees and more than half are based in Ontario.

“The business-to-population ratio for Black people in Canada is 2.6 percent, compared with a business-to-population ratio of 10.12 percent of the general Canadian population,’’ Pierre explained.

“The average business-to-population ratio in the USA is 18.6 percent. However, when we isolate the 17 wealthiest states in the USA, the BPR is 28.6 percent,’’ he added.

“This is what we have to focus on – business opportunities for Black people. To know the success of a country and its development, you have to look at the number of businesses it is creating,’’ Pierre told The Caribbean Camera.

“Within the Black community, we don’t have enough businesses to support our people. We’re not generating enough businesses in our community. We have one of the lowest business-to-population ratio. We want more people to get into business, have their own businesses, so they can employ other Black people.’’

MPP Smith, said Pierre, was “disturbed’’ by what the data revealed, and promised to share the information with his provincial cabinet colleagues.

“I’m very satisfied with the outcome,’’ said Pierre, who was accompanied to the meeting with the parliamentary assistant by architect and entrepreneur, Sephton Spence, a founding-member of the Afro Canadian Contractors Association and CEO of Kubbie Construction Inc.

“This was the first time I met a minister in Canada who was so interested in the development of Black people in Canada to that extent,’’ said Pierre, while emphasizing that “the Black business community in Canada needs a lot of help’’.

“Of the 42 fastest-growing industries in Canada, Black businesses are operating in 26 and are dominant in only nine. Of these nine industries, there is an over-concentration in six. This over-concentration limits the ability of Black businesses to be profitable,’’ said Pierre.