Each month I discuss the monthly U.S. Department of Labor jobs report on CNBC’s Power Lunch, and the findings are often bittersweet. Economists generally feel that our country is making progress. In fact, this summer, unemployment reached its lowest rate in six years—hovering close to 6 percent. Yet somehow, this improving trend continues to leave many African Americans behind.
In particular, African-American women are the only group whose employment prospects have not improved significantly over the last year. In the latest report, the unemployment rate for black women continued to hover right around 10 percent, and it’s not likely to move far from that position in the next report. The most perplexing aspect of this is that by contrast, a study from the Center for American Progress found that black women are starting businesses at a rate six times faster than that of the overall population—making up the fastest-growing segment of women-owned businesses in America.
So why is the unemployment rate still so unacceptably high for this group—and how can we work together to fill this gap, capitalizing on this success to help solve the problem? One of the first steps to accessing the potential of women entrepreneurs to drive job creation is to identify and address reasons that 80 percent of small businesses fail within the first five years.
As head of the National Urban League for the past 11 years, I’ve seen businesses flop because of lack of market demand, connections or networks, contracts, business owners’ lack of experience running day-to-day operations, and lack of access to or unsuccessful management of capital, among other hurdles. In addition, businesses started by women are more likely to fail because of specious stereotypes held by society and the industries in which they are aspiring to make their mark.
That’s why we’ve created programs like our Jobs Rebuild America initiative, which includes Entrepreneurship Centers in cities around the country that aim to power up jobs growth and improve the skills of small-business owners. Participants are provided basic business and management training so that they can seize new opportunities and keep their ventures on a steady, sustained course.
We work with entrepreneurs entering both the public and private sectors, helping them access capital and hire people from within their own communities and, in turn, helping to support the local economy. Most important, we encourage them to network with others who have succeeded. And because the best “giveback” is to give back, we ask them to mentor others who are learning the ropes behind them as they, too, become successful.
Our Entrepreneurship Centers are having an impact, with 70 percent of the 12,000 people served each year being women, and thousands of jobs created as a result of their success. But demand for these services far exceeds supply. Right now the centers are supported by partnerships and supplementary grants such as those with Coca-Cola, which focus specifically on women’s empowerment, and others. With the support of our dedicated partners, we hope to serve many more people left behind by the economic recovery who are determined to make a better life for themselves.
To succeed in a harsh labor environment, African-American women business owners or those seeking to start businesses should be empowered, supported by their communities and unencumbered as they advance toward their vision. We all have a role to play. If public, private and nonprofit sectors invest in bolstering their efforts, these women could help create a model for job creation that brightens the economic picture for those who seek a place in the workforce.
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Marc H. Morial is president and CEO of the National Urban League. Follow him on Twitter.