By now, It is no secret that LA Clippers owner Donald Sterling had no regard for the key African-American demographic group that consisted of his Clipper fan-base as well as the NBA in general. This controversy was a stark reminder of the ever-present elephant in the room. This elephant starts with the letter R and ends with ism. Under intense pressure by the NBA Players Association and by the aforementioned demographic group, Adam Silver laid down the huge hammer on Donald Sterling on Wednesday afternoon.
It should also be no secret that future demographics in the U.S are gradually headed towards the day in which minority groups will become the majority. Hence, this demographic has been known as the majority-minority demographic. According to the 2010 Census, there was a rapid decline until the amount of deaths among whites had actually outpaced the number of births in 2011-2012. This is seen in the graph below.
The majority-minority trend is accelerating. According to the latest Census analysis, fourteen states have a majority-minority toddler population. This is reflected in the preceding graph.
The U.S Census bureau projects that the United States will have a majority-minority population by the year 2043. Furthermore, minority groups are projected to make up 57% of the U.S population by 2060. .
Given that the majority-minority demographic is the future, it is puzzling to see the lack of aggressiveness by the business world in terms of taking advantage of this future trend. It is clear that there is still a disregard for demographic groups.
I refer you to the following statistic that NewsOne Now host Roland Martin has often referred to in social media circles.
According to the Wall Street Journal, black entrepreneurs have received a paltry 1.7% percentage of the 23.09 billion dollars in Small Business Administration (SBA) Loans during the last fiscal year. Out of about 54,000 small business loans, Black-owned small businesses got just over 1200 loans in total, or 2.3%. As this latest chart shows, Black and Hispanic small business owners combined to receive less than 10% of the total SBA loan amount.
Here is another fact that shouldn’t be a secret by now: Female, Asian, Hispanic and African-American CEO’s combine to represent less than 10% of all Fortune 500 CEO’s.
Further evidence of significant disregard for demographics can be found in the venture capital industry. According to a study done by the National Venture Capital Association and Dow Jones VentureSource, 76% of venture capitalists are white men. Asians, African-Americans and Latinos make up 10%, 1% and less than 1% of the venture capital industry. These numbers are representative of demographics of the past as opposed to the present and the future.
As seen by the latest graph below, the venture capital industry should be making a concerted effort to go after the female demographic given their tremendous strides in terms of education, employment, earning and purchasing power. This is seen in the following graph.
Source: Time Magazine
According to a 2012 Nielsen study entitled “African-American Consumers, Still Vital, Still Growing“, African-Americans are projected to have a buying power of $1.1 trillion dollars at the end of 2015. There was a 60% increase in the number of African-American households that have earned $75,000 or more between 2000 and 2009. The MultiCultural Economy Report from the Selig Center for Economic Growth stated that African-Americans had 1 trillion dollars in buying power last year while Hispanics have a buying power of 1.2 trillion dollars . The report stated that the buying power of minority groups outpaced the growth of their white counterparts.
In the Nielsen report entitled “Significant, Sophisticated and Savvy: the Asian American Consumer 2013,” Asian-American households spent an average of $61,400 in 2012, which was 19% above the average American household. The report stated that the buying power of Asian-Americans will reach 1 trillion dollars by 2017. In the Selig report, Asian consumers were expected to contribute 713 billion dollars to the economy in 2013.
As a demographic, minorities and women are achieving greater heights of economic prosperity and prominence with each passing year. The majority-minority population is not a matter of if, but a matter of when. The out-performance of women to men in terms of education, employment and earning power is here and now.
I will pause briefly to ask the following head-scratcher: Why are women are still not getting equal pay for equal work in 2014?
There is no doubt that the issue of fairness should be considered when it comes to an underrepresented demographic in certain functions of the business world.
Considering that the minority population is projected to become the majority in the future, there will be a day in which one should begin to question the economic practicality of key demographic groups who are underrepresented in key areas of business.
I believe that day is here.
The post A Disregard for Demographic Groups = A Disregard for the Future appeared first on Market Eyewitness.
