Top Banner

Click here to load reader

Puerto Rican Entrepreneurship in the U.S. ... U.S. Census Bureau’s Survey of Business owners1, Puerto Rican business firms in the U.S. employed over 250,000 employees and generated

Aug 29, 2020

ReportDownload

Documents

others

  • 1

    Puerto Rican Entrepreneurship in the U.S.

    NatioNal treNds Although Puerto Rican entrepreneurs only made 1 per- cent of nation’s total business establishments in 2012, they are the fastest growing entrepreneurs in the United States. As of 2012, more than half of all business firms in the U.S. were owned by non-Hispanic whites (69.8%) followed by Hispanics overall (12%), non-Hispanic blacks (9%), and Puerto Ricans (1%). In a 10-year span, Puer- to Rican owned business firms increased by 96 percent, from 109,475 in 2002 to 258,221 in 2012. Corresponding- ly, all Hispanic business firms also grew from 1.6 million in 2002 to 3.3 million in 2012, an increase of 43 percent. On the other hand, non-Hispanic black entrepreneurs grew from 1.2 million to 2.5 million, with an increase of 72 percent. Lastly, non-Hispanic white business firms were the only group to experience no growth in the nation, from 87 percent in 2002 to 70 percent in 2012, declined by 19 percent (see table 1).

    GeNder Nationally, more than half of all businesses were male- owned (55%) followed by 36 percent owned by females and the remaining 9 percent were both female and male owned in 2012 (see figure 1). Contrary to the 2012 nation- al rates, the share of Puerto Rican female entrepreneurs (53%) showed higher rates of businesses ownership rela- tive to their Puerto Rican male counterparts (46%) in the U.S. (see figure 1). In contrast to 2007, Puerto Rican male- owned businesses (54%) was higher compared to females (40%) and male/female owned businesses (5%). Similarly to Puerto Rican female entrepreneurs, non-Hispanic black female entrepreneurs (59%) also showed higher rates rel- ative to their male counter parts (39%) and to the nation as a whole (36%) in 2012. On the other hand, male-owned business firms were higher among non-Hispanic whites and Hispanics overall (57% for non-Hispanic white male owned firms and 52% for Hispanic male-owned firms) than

    Puerto rican entrepreneurs were the fastest growing business firms in the U.S. According to the most recent U.S. Census Bureau’s Survey of Business owners1, Puerto Rican business firms in the U.S. employed over 250,000 employees and generated $24.4 billion in sale revenues in 2012. Driven by population growth within the U.S. mainland and the recent Puerto Rican migration from Puerto Rico, Puerto Rican owned businesses exploded throughout the nation, especially in areas of new settlement. Data from the 2002, 2007, and 2012 U.S. Census Bureau’s Survey of Business Owners were used to analyze national and state level trends among Puerto Rican business owners relative to the other groups in the nation.

    ReSeARCh BRief issued April 2017 By: Jennifer Hinojosa Centro RB2016-14

  • 2

    female-owned businesses (33% for non-Hispanic white female owned firms and 44% for Hispanic female owned firms) in 2012.

    Among, all female entrepreneurs in the nation in 2012, Puerto Rican (53%) and non-Hispanic black (59%) were more likely to be business owners than non-Hispanic white (33%) and Hispanic (44%) female entrepreneurs in the

    U.S. The findings for Puerto Rican male owned business- es (46%) showed higher rates than non-Hispanic blacks (39%) but lower than the national rate (55%), Hispanics overall (52%), and non-Hispanic whites (57%).

    Nationally, the gender gap between male and female entre- preneurs was 23 percent in 2007 and declined to 18 per- cent 2012, a difference of 5 percentage points (see figure

    2002 2007 2012 % change

    2002 to 2012

    % change 2007 to

    2012 Puerto rican 109,475 0.5% 156,466 0.6% 258,221 0.9% 96% 62% Non-hispanic White 19,899,839 86.6% 20,334,403 75.1% 19,278,260 69.8% -19% -7% Non-hispanic Black 1,197,567 5.2% 1,760,065 6.5% 2,471,143 8.9% 72% 38% hispanic 1,573,464 6.8% 2,260,269 8.3% 3,305,873 12% 75% 43% Non-Puerto Rican hispanic 1,463,989 6.4% 2,103,803 7.8% 3,047,652 11% 73% 42% Total Population 22,974,655 100% 27,092,908 100% 27,626,360 100% 0% 0%

    Source: 2002, 2007, and 2012 Survey of Business Owners, U.S. Census Bureau

    Table 1. Owned Business by Race and ethnicity, 2002–2012

    figure 1. Business Owner’s Gender Composition, 2007 and 2012

    Puerto rican hispanic Non-hispanic White Non-hispanic Black All firms

    40%

    35%

    28%

    47%

    30%

    54%54% 54%

    45%

    53%

    5%

    11%

    18%

    8%

    18%

    53%

    44%

    33%

    59%

    36%

    46%

    52%

    57%

    39%

    55%

    1% 4%

    10%

    2%

    9%

    Female-Owned Male-Owned Male/Female Owned

    2007

    Female-Owned Male-Owned Male/Female Owned

    2012 Source: 2007 and 2012 Survey of Business Owners, U.S. Census Bureau

  • 3

    2). This nation-wide trend were also evident across all entre- preneurs regardless of race and ethnic background. Accord- ing to the 2012 Survey of Business Owners, Puerto Ricans and non-Hispanic black female entrepreneurs were among the only group to reverse the male to female gender gap. As shown in figure 2, Puerto Rican female entrepreneurs surpassed Puerto Rican male entrepreneurs by 7 percent- age points (53% of Puerto Rican business firms owned by females and 46% of Puerto Rican business firms owned by males) and reversed the gender gap from 14 percent in 2007 to -7 percent in 2012. In other words, Puerto Rican

    female entrepreneurs outpaced their male counterparts in 2012. Similarly, non-Hispanic black female entrepreneurs also exceeded non-Hispanic black male entrepreneurs in 2012, as well as in 2007. For example, there were at least 3 percent more female black owned businesses than males in 2007 and the number of female entrepreneurs increased to 20 percent in 2012 (see figure 2). On the other hand, non-Hispanic white firms showed the widest gap between male and female entrepreneurs, 26 percent in 2007 and 24 percent in 2012. This finding was also found among Hispan- ic owned businesses in both years, from 19 percent in 2007

    figure 2. Gender Gap among U.S. Business Owners, 2007 and 2012 2007 2012

    Puerto Rican Hispanic Non-Hispanic White Non-Hispanic Black All Firms Source: 2007 and 2012 Survey of Business Owners, U.S. Census Bureau

    14%

    -7%

    19%

    7%

    26% 24%

    -3%

    23%

    18%

    -20%

    2012 2007 diff % change 2007 to 2012 Puerto ricans $24.4 billion $16.6 billion $7.8 billion 47% hispanics $473.6 billion $350.7 billion $123 billion 35% Mexicans $204.7 billion $155 billion $49.8 billion 32% Cubans $96.6 billion $58.3 billion $34.3 billion 59% Non-hispanic white $11 trillion $10.2 trillion $710 trillion 7% Non-hispanic blacks $150.2 billion $136 billion $14.5 billion 11% All U.S. firms $33.5 trillion $30 trillion $3.5 trillion 12%

    Source: 2007 and 2012 Survey of Business Owners, U.S. Census Bureau

    Table 2. Total Revues by Race and ethnicity, 2007 and 2012

  • 4

    to 7 percent in 2012.

    iNDUSTRy & TOTAl ReveNUeS In 2012, Puerto Rican owned businesses generated more than $24.4 billion in total sale revenues, a 47 percent increase from 2007 ($16.6 billion). Relative to other groups in the U.S., non-Hispanic whites ($11 trillion) showed the highest combined gross receipts (also known as total sale revenues) followed by Hispanic owned firms ($473.6 billion), and non-Hispanic blacks ($150.2 billion) in 2012. As shown in table 2, compared to all U.S. firms (12%), Puerto Rican (47%) owned businesses showed the highest percent change in total sales revenues, fol- lowed by all Hispanic firms (35%), non-Hispanic blacks (11%), and non-Hispanic whites (7%), between 2007 and 2012. This finding suggest Puerto Rican owned businesses are not only increasing in terms of the number of business establishments throughout the nation, but they are showing a promising eco-

    nomic future as their total sales revenues increased by 47 per- cent in a 5 year span.

    The 10 largest Puerto Rican owned firms in the U.S. in- cluded the following industries: ‘other services’ (21%), ‘health care and social assistance’ (16%), ‘administrative and support and waste management and remediation ser- vices’ (13%), ‘professional, scientific, and technical ser- vices’ (10%), ‘construction’ (9%), ‘retail trade’ (7%), ‘arts, entertainment, and recreation’ and ‘transportation and warehousing’ (5% for both industries), ‘real estate’ (4%), and lastly ‘educational services’ (3%) in 2012. Among all Puerto Rican owned business firms that generated over $1 billion in total sale revenues included: ‘professional, scien- tific, and technical services’ ($3.7 billion), ‘wholesale trade’ ($3.5 billion), ‘construction’ ($3.1 billion), ‘retail trade’ ($2.9 billion), ‘healthcare and social assistance’ ($2.8 billion),

    2002 2007 2012 % Change rate of Growth (10yrs)

    Absolute Change

    +/- Other services (except public administration) (605) 16,274 22,551 53,264 2.3 22.7 36,990 Administrative and support and waste management and remediation services 9,823 16,388 33,350 2.4 24 23,527

    Health care and social assistance 19,635 22,582 42,249 1.2 11.5 22,614 Professional, scientific, and technical 10,875 17,745 26,648 1.2 14.5 15,773 Construction 10,649 16,735 22,021 1.1 10.7 11,372 Retail trade 10,728 12,671 17,930 1 6.7 7,202 Arts, entertainment, and recreation 5,572 7,881 12,395 1.2 12.2 6,823 Transportation and warehousing (603) 7,458 11,028 12,077 0.6 6.2 4,619 Real estate and rental and leasing 5,818 11,520 10,216