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Success, obstacles for firms owned by minorities, women

February 28, 2018

NEW ORLEANS (AP) — A report on economic disparities in New Orleans says businesses owned by minorities or women received 47 percent of overall city government spending for goods and services in New Orleans from 2014-2016.

Officials who released the report Wednesday called that a positive sign. The report estimates that about 44 percent of New Orleans-area businesses that are available for city work are owned by women or minorities. That figure is drawn from research on firms that have either expressed interest in city contracts or that have been identified as performing the types of work the city needs.

However, the report also shows room for improvement in various areas, noting that minority- and women-owned businesses are under-represented in some types of city contracts.

“African-American-owned construction firms make up 27 percent of the market. Yet, they only get 11 percent of city construction contracts,” Mayor Mitch Landrieu noted during an event marking the draft’s release. “Asian-American and Hispanic-American-owned firms are also awarded a disproportionately small share of city work.”

The report also outlines several factors indicating women and minorities face numerous obstacles in establishing successful businesses, including a lack of access to credit. The study cited Federal Reserve Board research indicating business loans are denied at a higher percentage rate for minority- and women-owned businesses than for businesses owned by whites and men.

The report said researchers obtained comments through interviews, telephone surveys, public meetings and other methods from 500 business people of various races. The researchers said they found that many minority and women business owners feel excluded from opportunities for work.

“Some interviewees said that minority and women business owners are not invited to ‘sit at the table,‘” the report said. “A number of women brought up the challenge of ‘not being taken seriously’ in ‘male-dominated fields.’”

Keen Research was chosen by city officials in 2016 to conduct the study. More public comment will be sought before a final version is released later this year.

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