Latino Businesses Outpace U.S. Rate

The number of Latino-owned businesses grew at three times the national rate for all companies from 1997 to 2002, the government said Tuesday.

Latinos owned nearly 1.6 million businesses in 2002, a 31% increase from five years earlier, the Census Bureau report said.

The overwhelming majority of the new businesses were one-person enterprises, according to the report. Only 13% of Latino-owned businesses had any employees other than the owner. About a fourth of all U.S. businesses had employees in 2002, the report said.

New businesses started by Latinos face many of the same problems as businesses started by non-Latinos, and the biggest hurdle usually is money to start and expand the business, said Louis Olivas, assistant vice president for academic affairs at Arizona State University.

“All start-up businesses face funding issues,” Olivas said.

The report is based on administrative records and a survey of 2.4 million businesses. The Census Bureau defines Latino-owned businesses as private companies in which at least 51% of the owners are Latino. The report does not classify public companies, with publicly traded stock, because they can be owned by many shareholders of unknown ethnicities.

Latinos owned nearly 7% of all businesses in 2002, up from about 6% in 1997.

They made up a little more than 13% of the population in 2002, but they have accounted for half of the nation’s population growth since the start of the decade, a recent report by the Brookings Institution found.

Among the report’s findings:

* Los Angeles County had 188,472 Latino-owned businesses in 2002, more than any other county.

* Nearly 3 in 10 Latino-owned firms were in construction or other service-related industries in 2002.

* There were 29,184 Latino-owned firms with receipts of $1 million or more in 2002.