Top Black Business and Economic Stories for Week of May 10th to 17th

DJIA                                            23,679

Unemployment (U-3,U-6)           14.7, 22.8             

US Covid-19 Growth Rate           ~1.0%


Covid-19 hits Black Community Hard in Philadelphia Area (WHYY)
CNBC on health disparities by race (CNBC)
Racial resentment to beliefs about Covid-19 and African Americans (Washington Post)

Black women are affected the most by the COVID-19 crisis
Black Barbershops and Beauty Salons want to open in California
How are Black businesses in Pittsburgh doing during COVID crisis
—Paycheck Protection Program (PPP) / Small Business Loan Program
Charlene Crowell from the Center for Responsible Lending writes about minority business being excluded from the Paycheck Protection program.
Small Business Program short changes Businesses of Color
Black Businesses have trouble getting PPP loans (Newsone)
The SBA released an audit report of the Paycheck Protection Program.

The Paycheck Protection Program does not even mention minority businesses but it does acknowledge it failed to reach them.  In fact even the word “minority” is used only once in the document which quickly switches to the term: “under served.” 
Small amounts of aid to community banks and minority bank during crisis

P. Diddy helps businesses access the Paycheck Protection Program
Sean “P. Diddy” Combs created a website to help Black business access Paycheck Protection Program. You can view the Our fair share website here.

The Network Journal also covers the story (Network Journal) has the story here.

Urban Planning
City Lab has a good story on under investment in Black neighborhoods

Economic News
Fed Chairman Jerome Powell say economy won’t be back for awhile in a sixty minutes interview
Highlights: 25% unemployment, no V-shaped recovery, demand will be low as people save and at least 20% GDP shrinkage. Long interview with some details.  The usual fed speak, but it was 60 minutes, so the fed is worried about the average consumer(worker a little less) 

He did mouth the administration Trope about: “Lowest Black unemployment ever,” so he loses points. The rate was low because they ran out of people to hire.  Check the participation rate and EM ratio. Also wage are the lowest they have been for 40 years.  Plus job quality of work life stinks. So, they might be jobs, but they sure aren’t good jobs. 

Academic Journals
William Darity at Duke University has a new research paper on the Black Middle Class

The Black Economic Alliance has a relief proposal for business affected by Covid-19. (Black Economic Alliance)

Lots of Unemployment stories, so we will pick three good ones
BLS April Unemployment Report

The BLS released the April Unemployment report on May 8th with depression levels of joblessness.  The narrow national unemployment rate was recorded at 14.7%. The boarder, U-6 (everyone who wants to work plus people who want more hours) stood at 22.8%.  More than twenty million payroll jobs were lost.
The unemployment rate for Black spiked at 16.7%, but the Black/White unemployment rate gap narrowed, meaning more Whites were laid off than Blacks (proportionally).Leisure and Hospitality lost a staggering 7.6 million jobs of which 5.5 million were restaurants and bars.
Unemployment payments continue to lag

Unemployment benefits can exceed salaries for some job categories

Joe Biden releases plan for Black America called “Lift EveryVoice”.
The plan address proposes to “improve economic mobility, close racial wealth gaps, improve education, and end health disparities by race. There are also some justice related ideas such as promoting a fairer justice system, increasing voter access and addressing environmental justice issues.
Our View:  The mild plan is a welcome change of tone and direction.While the proposals are certainly needed, it’s a rather small and timid grab bag of extensions to existing programs. 

Interesting People
Real Estate Broker, Tiffany Curry, becomes first Black Berkshire Hathaway Franchise Owner
The Famous Marcus Books in Oakland may not survive.
Pandemic may affect census counts in minority communities

Top Black Business and Economic Stories for Week of May 18th to 24th

Quick Check of Key Economic Indicators:

“Real” Black Employment Rate     24.8%
Unemployment U-3                        14.7%

DJIA                                               24,995

Tyler Perry Plans to reopen studio

Tyler Perry productions plans to re-open it’s TV studio this summer. They plan to start production on at least two TV shows. They will follow strict workplace safety measures. 

Study find Black and Spanish businesses are not receiving PPP loans
Unidos US, Color of Change and Global Strategy Group surveyed 500 Black and LatinX business owners and 1200 Black and Spanish workers.  They found that up to 45% of Black and Spanish business owners may close by the end of the year.  More than half of the business (51%) have applied for assistance ($20,000 dollars or less), only 12% got anything.

Here’s the press release. You can also view a summary presentation here.

Forbes Magazine has a write-up

CBS News has the story also

Working black business drop by 40% 

The Washington Post reports that Black businesses are having a difficult time during the Coronavirus Pandemic. New research show that in April up to 450,000 active Black businesses have closed.

NAACP call for more PPP lending by congress to Minority Communities

NAACP would like to see more minority lending in the PPP program

How to help Black businesses in Baltimore

Wayne Frazier, writing in the Baltimore Business Journal, has some ideas for assisting minority businesses. 

Robert Smith offers advice on getting PPP loans

Robert Smith appeared on the CBS Morning news with Gayle King. Robert Smith, CEO of Vista Equity Partners, is the richest Black Billionaire in the US with a net worth of $5 billion dollars. He is known for paying off the entire student debt of last years graduating class at Morehouse College. 

Reality TV Personality Charged with Bank Fraud

The justice department charged “Arkansas Mo”, real name Maurice Fayne, with Bank Fraud.  He is a reality TV start on Love and Hip-Hop: Atlanta.  He owns Flame Trucking. He is accused of misusing a $2 million dollar PPP loan for personal items rather meeting his business payroll.  

Magic Johnson and NAN help loan $100 Million

Earvin “Magic” Johnson’s Equitrust Funds Over $100 Million In PPP Loans For Minority And Women-owned Businesses

Credit denials by race to be collected
CFPB lawsuit settlement forces agency to collect data oncredit access.

President Trump meets with Black leaders in Michigan
President Trump met with Black leaders in the Ford Rawsonville Components Plant in Ypsilanti, Michigan before touring the plant.
The president read a prepared statement of accomplishments and generic remarks which included his hits: “China is responsible for the virus” and “Black people had the lowest unemployment rate ever.” He ended with remarks opposing mail-in voting.

C-Span has the video
Several of the leaders work directly for him. One leader is a senate candidate in Michigan. Here is a partial list:

Ben Carson Sr., M.D., Secretary Department of Housing and Urban Development

Scott Turner, Executive Director, White House Opportunity and Revitalization Council

John James, Senate Candidate – Michigan

Ja Ron Smith – Assistant to President for Domestic Policy

Karen Whitsett, State Representative, Michigan

Pastor Darrell Scott

You may have missed

City Lab has a good story on under investment in Black neighborhoods. The City Lab link is here.

Joe Biden released a plan for Black America called “Lift Every Voice”.
The plan address proposes to “improve economic mobility, close racial wealth gaps, improve education, and end health disparities by race.” There are also some justice related ideas such as promoting a fairer justice system, increasing voter access and addressing environmental issues.

Our View: While the proposals are certainly needed, it’s a rather small and timid grab bag of extensions to existing programs. It does not do much to tackle underlying issues.  However, given where we are with the Trump administration, the plan is a welcome change of tone and direction.

Interesting People

United Airlines Appoints Brett J Hart as President

Pioneer black architect, Robert Coles, passes away


The Dow Jones Industrial Average rose 500 points this week to 24,995 on the hopes of opening the US economy and a vaccine.  

Top Black Business and Economic Stories for the Week of May 24th to May 31st

Protest Related

Minneapolis has some of the worst inequality in the US. (Washington Post)

UC Berkeley News has a piece about ignoring the advice of the Kerner Commission called “The Road Not Taken: 50 Years After the Kerner Commission.”

Here is the Kerner Commission Report Executive Summary and the Kerner Commission Report.

In 1968, The Kerner Commission Got It Right, But No One Listened(Smithsonian Magazine) — Quick Summary: The riots were caused by segregation(White flight) and lack of economic opportunity. Duh. Add in a dose of Police violence and you get a riot.

Blackout Day is July 7th — Social Media is calling for Blackout Day on July 7th. A nationwide boycott of all spending by Black people. In addition people should spend 15% of their incomes with Black people. The campaign is called Blackout 2020.

The hash tag is #BlackOutDay2020 on Instagram and Facebook.  There are details at the KHOU in Houstion has a write-up.

Camille Squires (Mother Jones) asks the right question: “How much do looted stores really contribute to the local community?”

Marijuana Industry should deliver on social justice (Pot Network)
If any industry owes something to Black people, it’s the Marijuana Industry, which is controlled by rich, White men.


Black New Yorkers hit with high layoffs(NY Patch)
Black business is Boston try to stay open (Boston 25 News)
Black barbers and stylist work from home (LA Times)
Work in the hair industry is difficult with social distancing(ABC News)
Massachusetts business look for equitable development and recovery (Mass Inc)

Racism and Inequality

Racism is the reason the US has such a weak social safety net (NoahSmith writes in Bloomberg opinion)
Older piece from 2019 on same topic (Marketwatch)
Black Wealth 2020 details “equality” policy proposals to lawmakers(Charleston Chronicle). 
Black people invest in the stock market at much lower rates than others. (Investors Business Daily) The stock market since 2008 has been a great investment


Massachusetts Attorney General wins $380,000 settlement with ENE Systems over false claims of hiring minority subcontractors.(WGBH)


Human Rights Watch has produced a report on the Tulsa Race Riot / Greenwood Massacre Reparations study (Human Rights Watch)

General Economics

Many of the problems in US society and Black communities can be linked to de-industrialization. Senator Marco Rubio(R-FL) believes de-industrialization reduced Black opportunities which contributed to covid related deaths among Blacks.

De-industrialization(The Hour)
Sen. Marco Rubio proposes industrialization to close Black White income gap.(The Federalist)


Seventeen medical schools with the highest percentage of African Americans(Yahoo Finance)
A majority of first round NFL picks have Black agents.(Black Press USA)
State budget under huge pressure as Lottery Sales have fallen off(NJ TapInfo)
Andrea Harris, leader of Black economic development, dies (ABC 11 Raleigh – Durham)

History Lesson

Sarah Rector was a Black female millionaire during the 1920s. She made her money when oil was discovered on her family’s land. The US Government forced the land to be given to the family by the  tribe who held her family as slaves.

How native Americans adopted slavery from White Americans. (Al Jazeera). Members of five Native American nations, the Cherokee, Chickasaw, Choctaw, Creek, and Seminole Nations (known as the Five Tribes) owned black slaves.

From last week

Less than 40% of Black Business still open (Jacksonville Free Press)

US National Black Income Estimated at $1.2 to $1.4 Trillion Dollars in 2018

Black people are a significant part of the US Economy. We are essential workers in many employment categories such as nurses, bus-drivers, government workers, teachers and warehouse workers. We are also highly visible as sports figures and entertainers. Blacks work in a wide verity of jobs and geographies. Together, we earn an estimated $1.3 Trillion Dollars.

For some perspective, there are about 47.8 million African-Americans(2018) in the US and they receive, spend or influence between $830 Billion (IRS) and $1.7 Trillion (estimated from personal income accounts[NIPA]). That is larger than ALL the spending in the country of Mexico and four times the GDP of Nigeria. Clearly Black workers earn a lot of money and Black people spend a lot of money.

There are four ways to estimate Black income: Ask on a survey, review tax data, calculate it from US total income data and capture actual spending data from businesses. We want to spend some time looking at each of these estimates. We are using data from the year 2018 which is the last year reported by the US census, the BEA, and the IRS. The two non government sources report yearly.

Earning and spending are different. Black workers reported earning about $1 Trillion dollars in 2018 on four important surveys: Current Population Survey(CPS), American Community Survey, Consumer Expenditure Survey(CEX) and Survey of Consumer Finances(SCF-2016). The CPS and the CEX are conducted by the US Census Bureau and the Bureau of Labor Statistics every year. The ACS is done by the US Census. Finally, the SCF is handled by the New York Federal Reserve every three years.

The largest estimate is $1.7 Tillion using data from the Bureau of Economic Analysis(BEA). It is based in National Product and Income Accounts(NIPA). The NIPA accounts capture all economic activity in the US economy. The estimate is calculated from the total US national income adjusted for the ratio of Black income to total US income. In other words, the Black share of national income. The ratio, the Black share of US income, is calculated from CPS household income ratios.

Finally, There are two other spending estimates. We are assuming that most spending is based on income (past or future), so the spending would be close to the income. One is from a private company, Neilsen and the second is a University research center, Selig at the Terry business school at the University of Georgia. Both release limited top level data and charge for their research details.

They both estimate US Black spending at $1.3 Trillion in 2018.

Table 1. Summary of Estimates and Sources for 2018

SourceAmount (Billion)YearComment
CPS Individual1,1252018
CPS Household1,0072018Used to calculated split ratios 2007-2018
ACS Individual9702018
ACS Household8882018
SCF-2016*9822015Data from 2015 adjusted for inflation to 2018
BEA NIPA Est*1,7142018Split by CPS Household Racial Income Ratios
IRS SOI Est (2018)*829 2018Split by CPS Household Racial Income Ratios
Neilsen (2018)1,3002018Spending; Private methodology
Selig (2018)1,3002018Spending; private methodology

On the CPS Household survey, Blacks had an estimated income of $1.07 Trillion dollars.

National Black Income

How do define National Black Income ?

Black National Income, Black Income is Black Earning Power or the total amount of money available to Black People in the US. Black Disposable income is what’s left after taxes. Black Spending Power is disposable income minus savings.

Surveys that ask about National Black Income ?

four/five ways to measure national Black income: CPS, ACS, BEA NIPA and IRS SOI. SCF. Ed Note: Survey of consumer finances – 2016. CPS and ACS are from the US census. CPS is annual (December to December) while ACS is a rolling 1-year and 5-year data set. ACS and CPS contain explicit data on race while NIPA and SOI do not. NIPA should capture all income earned in the US.

NIPA data deserves special mention. It should capture ALL economic activity in the US economy since the economy is circular. Someones purchase is another persons sales. A business’s spending is some one else’s earnings. Total Sales = Business Income + Consumer Income = Total Sales.

In other words money flows in a closed loop through the economy. The money we spend has to equal the money we receive. So if we spend ($1.7 Trillion) then we earn $1.7 Trillion. Money does not grow on trees. (At some point we have to discuss MMT)

NIPA and SOI data for Black income were estimated. NIPA and SOI data is not broken down by race, so we used the CPS household income ratios. (Editors note: At some point we will have to go back and recalculate the ratios based on CPS Individual, ACS, and SCF data to see if there is a significant change)

Are there other estimates ?

Yes, Neilsen and UGA Selig center offer estimates. Neilsen is a sales data company, so they have an incentive to make the figures as larger as possible while discussing there expertise in the area. Selig is a think tank.

It’s the middle of 2020 and the data is from December 2018.

Yes, CPS is reported in September for the previous year..

Do people under report income to the IRS ?

Yes, it’s estimated that income could be 30% higher than reported to the IRS.

Do people under report income on the US Census CPS and ACS?

Yes, but the actual amount is unknown. It may also be small. The Congressional Budget Office did a correction for under reported social benefits (probably at the suggestion of a Republican senator) and found very little impact on income from benefits. (Ed Note: double check impact). In addition fringe benefits and imputed rent are not included in the estimates.

What impact would unreported income make? Can we account for illegal profits? What about barter?

In theory “Black” money eventually shows up in the National Income and Product Accounts of the BEA. Everyone goes to the store to buy food.

You you could see an interesting scenario where we get our plumbing fixed and pay cash. The plumber buys weed and pays cash. The weed man goes to the vegan restaurant and pays cash. And the chef pays cash at the organic Black farm. All economic transaction not recorded anywhere, but still workers earning money.

The reality is much different. As soon as someone buys a gallon of gas, a bag of Doritos or toilet paper: bam!, the transaction is recorded. And in the statistics.

Barter is a great idea but almost unworkable in a specialized, branded, advertising driven society. The total amount of bartered goods was estimated at (ed note)


Neilsen is a global marketing research firm. Neilsen’s Black spending data came from two press releases: PR 2018 and PR 2019. The company produces is a yearly estimate of Black spending power as part of a marketing effort to advertisers.

US Census Bureau — Differences Between American Community Survey(ACS) and Current Population Survey Annual Social and Economic Supplement (CPS ASEC)