L.A. County Leads U.S. in Firms Owned by Women

Los Angeles County has the largest number of women-owned companies in the nation, and its black-owned businesses have the biggest sales, the Census Bureau reported Tuesday.

The 1992 survey of U.S. metropolitan areas shows Los Angeles, a center of entrepreneurial activity, with a significant role as headquarters for successful business enterprises operated by women and blacks. Los Angeles firms generated 11% of all revenues for the nation’s black-owned businesses and 4% of the money collected by women-owned companies.

The special census, which is conducted every five years, gives the most accurate picture available of American commercial enterprises.

The county had 232,723 firms owned by women, with total receipts of $28.7 billion. Although other metropolitan areas surpassed Los Angeles County when population is taken into account, only New York had higher receipts--$36.5 billion produced by 187,525 firms.

Lindsey Johnson of Women Incorporated, a nonprofit financial association for women, theorized that New York’s women-owned businesses generated more income because they are more established than those in California.

New York and other Rust Belt states were hit by corporate downsizing in the late 1970s, prompting women to start their own firms. Not until nearly a decade later did California began to go through the same process, she said.

Furthermore, immigration has helped swell the ranks of women-owned businesses in Los Angeles County. These are relatively low-grossing businesses, helping to keep a lid on the total receipts of women-owned businesses in the county compared with other metropolitan areas.

The 32,645 black-owned companies in Los Angeles generated receipts of $3.6 billion. New York and Washington had more firms, but each of those metropolitan areas had less than half of the $3.6 billion produced in Los Angeles.

The higher Los Angeles numbers probably reflect businesses requiring more capital, and generating greater receipts, such as manufacturing, wholesale trade and distribution, and finance.

“More capital-intensive businesses need more credit, and their average revenues are higher,” said Bruce Phillips, director of economic research for the Small Business Administration.

Black-owned high-technology businesses and entertainment firms could also account for the greater business receipts here, said Charles Blackmore, chairman of the 3,500 member Black Business Assn. of Los Angles.

Blackmore, who heads Data Systems, a computer systems installation company in Orange, said California’s aerospace industry helped create numerous black-owned technology businesses that have since expanded to jobs outside aerospace. Meanwhile, more than 65 black-owned music and movie production companies are based in Los Angeles, he said.

Tim Lester, executive director of the Greater Los Angeles African American Chamber of Commerce, added that many of Los Angeles’ black businesses have matured to national scope.

Among them are Golden State Mutual, a nationwide insurance company; G&C; Equipment Co., which leases and sells construction equipment nationally; and Act 1 Personnel Service.

“The scope is national but they’re based here,” Lester said.

The broader region, including the counties of Los Angeles, Orange, Riverside, San Bernardino and Ventura, accounted for 41,190, or 60%, of the state’s black-owned firms, with receipts of $4 billion. The 383,358 women-owned firms in the Southland made up 48% of the state’s total and had $44.1 billion in receipts.

Business activity is booming among female and black entrepreneurs, according to the Small Business Administration. The number of businesses in the U.S. rose 26% between the economic censuses of 1987 and 1992. However, the number of black-owned enterprises rose even faster, climbing 46%, while the roster of women-owned firms grew 43%.

The survey measures ownership among various forms of business enterprises. The most common are individual proprietorships. The Census Bureau uses data from the Social Security Administration to identify racial groups and gender, and relies on the Internal Revenue Service to identify revenues.

The government has reported previously on state business totals: California had 68,968 black-owned firms with receipts of $5.5 billion during the 1992 survey. There were 801,487 firms owned by women with receipts of $85 billion.

Census reports on businesses owned by Latinos and Asians will be issued later this year.

Rosenblatt reported from Washington and Torres from Los Angeles.

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How They Rank

Women- and black-owned businesses are counted every five years by the Census Bureau. The latest report, for 1992, shows that Los Angeles is among the top five cities in both categories. Businesses counted were sole proprietorships, partnerships and S corporations. Larger and more complex C corporations were excluded.

Women-Owned Businesses in 1992

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Number per Metropolitan Number 1,000 Receipts area of firms population (billions) Los Angeles 232,723 25.7 $28.70 New York 187,525 22.0 36.50 Chicago 163,883 22.0 26.50 Washington 122,007 28.0 10.70 Philadelphia 95,441 19.3 15.80 Southern California Counties Orange 75,219 30.3 9.90 San Bernardino 28,818 18.8 2.10 Riverside 28,551 22.1 2.00 Ventura 18,047 26.3 1.50

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Black-Owned Businesses in 1992

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Number per Metropolitan Number 1,000 Receipts area of firms population (billions) New York 39,404 4.6 $1.70 Washington 37,988 8.7 1.70 Los Angeles 32,645 3.6 3.60 Chicago 24,644 3.3 1.60 Atlanta 23,488 7.5 1.00 Southern California Counties Orange 2,237 0.9 0.22 San Bernardino 3,366 2.2 0.11 Riverside 2,245 1.7 0.09 Ventura 697 1.0 0.04

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Source: Census Bureau