Best Cities For Minority Entrepreneurs
There are essentially three ways of dealing with America’s tattered balance sheet and mounting financial obligations: curbing social services, hiking taxes and generating real, sustainable economic growth–and the first two aren’t exactly palatable.
As for growth, minority entrepreneurs are playing an increasingly important role. Just one data point: In 2010 immigrants accounted for nearly 30% of new business owners, versus 13% in 1996, according to the Kauffman Foundation.
In Atlanta, where half the residents are African American, a host of Hispanic and Asian entrepreneurs have set up shop over the last decade. Atlanta now boasts the second-highest percentage of self-employed minorities among the top 52 metropolitan areas with populations greater than 1 million.
That statistic–combined with a growing population, increasing household incomes and affordable housing–puts Atlanta atop our list of best metro areas for minority entrepreneurs, assembled with help from economist-demographer Joel Kotkin, author of The Next Hundred Million: America in 2050. (For more entrepreneurial inspiration, check out Forbes Staff Writer Maureen Farrell’s profile of Rene Diaz, owner of Diaz Foods, a $200 million food-distribution business in Atlanta.)
The data correspond to 52 metropolitan statistical areas (MSAs), including a core city and its suburbs, with 1 million-plus populations. For each ethnicity (African Americans, Asians and Hispanics), we measured housing affordability (median value divided by household income), population growth (2000–09), income growth (1999–2009) and entrepreneurship (per capita self-employment). Each ethnicity received a rank, with entrepreneurship weighted one-half and the other half split evenly among the other variables. Those scores were then averaged to calculate overall city rankings.
Atlanta’s foreign-born population nearly doubled, to 710,000, between 2000 and 2008. Meanwhile, the ratio of the median house value divided by median household income for minorities remains one-half or less that of San Francisco, New York City and Los Angeles.
More nettlesome, fear business leaders, is the recent cry for strict anti-immigration policy. One bill, proffered by Representative Matt Ramsey (R-Ga.), would force companies to use a federal database to confirm an employee’s eligibility and also allow police officers to ask for proof of citizenship during traffic stops.
The Baltimore metro area–at No. 2 on our list–ranked third in the percentage of self-employed Asians (8.4 per 100). HBO’s The Wire, set in urban Baltimore, featured less-than-legal entrepreneurship, but legitimate minority enterprise is thriving in the greater surrounding areas–crucial, given the city’s 13.6% and 5.8% declines in its white and African American populations since 2000.
In No. 3 Nashville, the immigrant population soared 83%, to 107,000, between 2000 and 2008–the fastest growth rate among the nation’s largest cities. Just 20% of the population in 2000, minorities accounted for 44% of the city’s overall growth during the next decade. Plenty have hung out their own shingles: Of the 52 metros with populations over 1 million, the capital of country music (and health care) ranked sixth in self-employment among Asians and fourth among Hispanics.
Over the last decade Houston (No. 4) has created more jobs than most big urban areas, all while keeping rents down. Its expanse of strip malls teems with ethnic businesses. Architect Tim Cisneros, who builds offices and town houses there, calls Houston “my favorite Third World city.” Houston also ranked second in housing affordability for minorities, and it is home to the nation’s second-largest Hindu and fourth-largest Latino church congregations.
The booby prize went to the Milwaukee metro area. The former beer-brewing capital ranks in the bottom eight—or worse—in self-employment among all three major minority groups.
One big problem: fewer customers. The city has shed residents in each of the last six censuses. Another: “Milwaukee has had among the worst job-creation records of any big city in the U.S. for over a decade,” says Mark Levine, executive director of the Center for Economic Development at the University of Wisconsin-Milwaukee.
Here is the full ranking of the top 52 metros for minority entrepreneurs, according to Kotkin and his tag team of researchers, Wendell Cox and Erika Ozuna:
- Atlanta-Sandy Springs-Marietta, GA
- Baltimore-Towson, MD
- Nashville-Davidson-Murfreesboro-Franklin, TN
- Houston-Sugar Land-Baytown, TX
- Miami-Fort Lauderdale-Pompano Beach, FL
- Oklahoma City, OK
- Riverside-Sand Bernardino-Ontario, CA
- Washington-Arlington-Alexandria, DC-VA-MD-WV
- Orlando-Kissimmee, FL
- Phoenix-Mesa-Scottsdale, AZ
- Memphis, TN-MS-AR
- Dallas-Fort Worth-Arlington, TX
- San Antonio, TX
- Tampa-St. Petersburg-Clearwater, FL
- Austin-Round Rock, TX
- Charlotte-Gastonia-Concord, NC-SC
- Indianapolis-Carmel, IN
- Los Angeles-Long Beach-Santa Ana, CA
- Richmond, VA
- New Orleans-Metairie-Kenner, LA
- Jacksonville, FL
- Tucson, AZ
- Portland-Vancouver-Beaverton, OR-WA
- Raleigh-Cary, NC
- Louisville-Jefferson County, KY-IN
- Birmingham-Hoover, AL
- Seattle-Tacoma-Bellevue, WA
- Cincinnati-Middletown, OH-KY-IN
- Sacramento-Arden-Arcade-Roseville, CA
- Pittsburgh, PA
- Kansas City, MO-KS
- Columbus, OH
- Las Vegas-Paradise, NV
- Virginia Beach-Norfolk-Newport News, VA-NC
- San Francisco-Oakland-Fremont, CA
- Denver-Aurora-Broomfield, CO
- St. Louis, MO-IL
- Buffalo-Niagara Falls, NY
- New York-Northern New Jersey-Long Island, NY-NJ-PA
- Rochester, NY
- Hartford-West Hartford-East Hartford, CT
- Salt Lake City, UT
- Providence-New Bedford-Fall River, RI-MA
- Philadelphia-Camden-Wilmington, PA-NJ-DE-MD
- Boston-Cambridge-Quincy, MA-NH
- San Jose-Sunnyvale-Santa Clara, CA
- Detroit-Warren-Livonia, MI
- San Diego-Carlsbad-San Marcos, CA
- Minneapolis-St. Paul-Bloomington, MS-WI
- Chicago-Naperville, Joliet-IL-IN-WI
- Cleveland-Elyria-Mentor, OH
- Milwaukee-Waukesha-West Allis, WI
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