PROVIDENCE – While the minority population in Rhode Island is increasing, the number of minority-owned businesses in the Ocean State still lag behind the national average, according to a study released Friday by the Rhode Island Foundation and R.I. Commerce Corp.
The foundation said the $150,000 study, which also includes recommendations on how to address the issue, aligns with the nonprofit funder’s recommendations on how the state should spend its $1.1 billion share of the American Rescue Plan Act funds. The foundation also said R.I. Commerce expects to include the new study and its recommendations as part of Gov. Daniel J. McKee’s RI 2030 planning effort.
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According to the study, the state’s white population declined by 4% from 2010 through 2020. At the same time, the state’s other ethnic groups grew by a combined 27%.
However, the number of minority-owned businesses in Rhode Island are lagging. The study says about 7.4% of the state’s approximately 21,000 businesses have owners who identify as Black, Indigenous or people of color. Meanwhile, the national average of BIPOC-owned businesses across the U.S. is 18.3%.
The results in the foundation’s report mirror the analysis recently done by consumer financial site Smartest Dollar.
The study also outlined recommendations on how to increase the number of minority-owned businesses in the state. One recommendation is for the state to develop new funding vehicles that target the needs of BIPOC-owned businesses.
Another suggestion the study mentions is for the state to require entrepreneurship training for all the state’s K-12 students and expand entrepreneurship education options at community colleges. The study also recommends locating new co-working spaces in neighborhoods and locations easily accessible to BIPOC residents and creating a small business ombudsman position to address small business concerns.
Also, the study recommends the state to support a BIPOC Business Accelerator program, as also recommended in R.I. Commerce’s Rhode Island Innovates 2.0 plan to connect fast-growing BIPOC business to major corporate partners and customers.
In a statement Friday, Rhode Island Foundation CEO and President Neil D. Steinberg said the goal of the study and its recommendations was to engage existing organizations and new partners to expand outreach and support of minority businesses throughout the state.
“It will take a collaborative effort to take this to the next level,” Steinberg said.
R.I. Commerce Secretary Stefan Pryor said Friday in a statement that the state’s minority-owned business community has also been severely impacted by the COVID-19 pandemic and they need the state’s “strong support” to dig out of the health crisis.
““We are committed to renewed and strengthened partnerships that will enable enhanced support for minority-owned businesses in the near and long term,” Pryor said.
The full study can be read here.
James Bessette is the PBN special projects editor, and also covers the nonprofit and education sectors. You may reach him at Bessette@PBN.com. You may also follow him on Twitter at @James_Bessette.
