Owner Characteristics and Firm Performance During the Great Recession

28 Pages Posted: 3 Mar 2015

See all articles by Ron S. Jarmin

Ron S. Jarmin

U.S. Census Bureau

C.J. Krizan

Government of the United States of America - Bureau of the Census

Adela Luque

Government of the United States of America - Bureau of the Census

Date Written: September 30, 2014

Abstract

Minority owned businesses are an increasing important component of the U.S. economy, growing at twice the rate of all U.S. businesses between 2002 and 2007. However, a growing literature indicates that minority-owned businesses may have been especially impacted by the Great Recession. As house prices declined, foreclosures fell disproportionately on urban minority neighborhoods and one of the sources of credit for business owners was severely constrained. Using 2002-2011 data from the Longitudinal Business Database linked to the 2002 Survey of Business Owners, this paper adds to the literature by examining the employment growth and survival of minority and women employer businesses during the last decade, including the Great Recession. At first glance, our preliminary findings suggest that black and women-owned businesses under perform white, male-owned businesses, that Asian-owned businesses outperform other groups, and that Hispanic-owned businesses outperform non-Hispanic ones in regards to employment growth. However, when we look only at continuing firms, black-owned businesses outperform white-owned businesses in terms of employment growth. At the same time, we also find that the recession appears to have impacted black-owned and Hispanic-owned businesses more severely than their counterparts, in terms of employment growth as well as survival. This is also the case for continuing black and Hispanic-owned firms.

Suggested Citation

Jarmin, Ron S. and Krizan, C.J. and Luque, Adela, Owner Characteristics and Firm Performance During the Great Recession (September 30, 2014). US Census Bureau Center for Economic Studies Paper No. CES-WP- 14-36, Available at SSRN: https://ssrn.com/abstract=2572626 or http://dx.doi.org/10.2139/ssrn.2572626

Ron S. Jarmin (Contact Author)

U.S. Census Bureau ( email )

4700 Silver Hill Road
Washington, DC 20233
United States

C.J. Krizan

Government of the United States of America - Bureau of the Census ( email )

4600 Silver Hill Road
Washington, DC 20233-9100
United States

Adela Luque

Government of the United States of America - Bureau of the Census ( email )

4600 Silver Hill Road
Washington, DC 20233-9100
United States

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