2021: Data not yet available
2020: 1,001
2019: 1,514
2017-20 avg. 1,380
*Census/BEA
The Census’ annual counts of U.S. exporting businesses peak at 305,200 in 2014. Then they drift downward, to 289,400 in 2019; then comes a sheer drop to 271,705 in COVID-stricken 2020. The most recent report, for 2021, shows a modest rebound to 278,400 in 2021 as trade flows recovered. (The update for 2022 comes in January.) All the loss has come in the small-business sector. Census’ count of “large company” exporters — those with 500 or more employees — has actually risen a bit, from 6,968 in 2014 to 7,121 in 2021. The tally of very small exporters (those with fewer than 100 employees each) has meanwhile dropped by almost 10%, from 281,300 in 2014 to 255,300 in 2021. For some reason, which is not clear in the data, this drop appears to have been steepest among African-American businesses.
This insight comes from a decade-old Census/BEA statistical collaboration to provide a very detailed look at the nature of smaller exporters. For 2012, and then the years 2017-2020, the two agencies identified the ownership of about two-thirds of U.S. exporters by race and ethnicity, gender, public vs. private ownership, and veteran status. From there they proceed to find the countries where exporters find their customers; levels of employment and pay (including with comparison to non-exporters); and at least for 2017-2020 changes over time. The 2020 report, taken in the context of the 2017/2018/2019 editions shows the following about African American exporting firms:
(1) Total count, employment, and pay: Census and BEA found 1,001 African American-owned exporting businesses in 2020. As a group, they employed 49,045 workers, with a combined payroll of $1.96 billion — that is, an average of 49 people per business, at payrolls of $39,900 per worker. Their non-exporting peers, meanwhile, averaged 9 workers at payrolls of $33,191 per worker.
(2) Markets: The 1,001 firms earned about a tenth of their income from exports. (In precise terms, $1.1 billion out of $12 billion in total receipts). The European Union was their largest customer at $467 million, and bought from 358 of the companies. Canada was next at $115 million. The African American businesses were significantly more focused on African markets than other exporters: 13.8% of them, or 138 of the 1,001 in actual numbers, had African customers in 2020, as opposed to 8.4% of exporters with owners of other races and ethnicities. By country, over the most recent four years, Nigeria was their largest African market, followed by Ghana.
(3) Trends: Exporting communities of almost all ethnicities shrank in 2020, but the COVID shock seems to have hit African American exporting firms much harder than others. The 1,001 African American exporters in 2020 represents a drop of 27% from the average across 2017-2019, and 34% from the 1,514 in 2019. The count of African American exporters to Africa specifically fell especially steeply, dropping by half from 278 in 2019 to the 138 of 2020. Meanwhile, the counts of African-American exporters to China fell from 117 to 87, to Mexico from 121 to 108, and to India from 53 to 28. By comparison, BEA’s tallies of white-owned and Hispanic exporters were down about 7% from the 2017-2020 averages, and that of Asian-owned exporters by 3%. Native American exporters were an interesting exception, growing a bit in 2020 to 511 firms from an average of 452 across 2017-2019.
The reports do not indicate why, in the context of a general decline in trade during the COVID pandemic, the African American exporter group would have contracted more sharply than others. Nor do they say (since the most recent edition covers 2020*) whether their rebound in 2021 might have been stronger. Combined with Census’ total-exporter counts, though, they do seem to indicate that (a) U.S. small-business exporters have been struggling in general for nearly a decade, (b) the most recent drop hit African American exporters hardest, and (c) while government policies are never the only answer to a problem, the agencies charged with supporting SME exporters ought to be thinking about recovery options for this particular group, and probably more generally about whether their current approaches are enough.
* Census will update its total-exporters in April 2024 (with a preliminary edition in January) with 2022 figures. This will presumably help show whether the modestly higher count of 2021 was the beginning of a nearly decade-long negative trend, or just a small bounce after an unusually bad 2020. The very detailed Census/BEA studies with race/ethnicity/gender/market data for 2021 (assuming the two agencies keep doing them) would likely come out in May, with information on whether African American export businesses rebounded from the COVID shock at par with, or faster than, or slower than, their peers.
Census/BEA’s collaborative series on the nature of exporting businesses, with data on exporters by ownership, overseas markets, export dependence levels, employment, and payroll (2020 version; go to the main page for 2017, 2018, and 2019).
… and the annual report on exporters and importers by large/medium/small size, known as “Profile of Importing and Exporting Companies,” has totals, state-by-state figures, SMEs vs. large firms for 25 countries as well as the world, etc.
A recent report from PPI in collaboration with Prosperity Now looks at the barriers facing entrepreneurs of color, and the smaller, less profitable businesses that emerge as a result.
Government Resources:
The Minority Business Development Administration (2015) looks at diversity and success in American export firms.
The Commerce Department’s Global Diversity Exporter Initiative.
And the Small Business Administration’s export center.
World Perspective:
The WTO looks at small businesses and trade.
And the Geneva-based International Trade Center’s SME competitiveness report.
Ed Gresser is Vice President and Director for Trade and Global Markets at PPI.
Ed returns to PPI after working for the think tank from 2001-2011. He most recently served as the Assistant U.S. Trade Representative for Trade Policy and Economics at the Office of the United States Trade Representative (USTR). In this position, he led USTR’s economic research unit from 2015-2021, and chaired the 21-agency Trade Policy Staff Committee.
Ed began his career on Capitol Hill before serving USTR as Policy Advisor to USTR Charlene Barshefsky from 1998 to 2001. He then led PPI’s Trade and Global Markets Project from 2001 to 2011. After PPI, he co-founded and directed the independent think tank Progressive Economy until rejoining USTR in 2015. In 2013, the Washington International Trade Association presented him with its Lighthouse Award, awarded annually to an individual or group for significant contributions to trade policy.
Ed is the author of Freedom from Want: American Liberalism and the Global Economy (2007). He has published in a variety of journals and newspapers, and his research has been cited by leading academics and international organizations including the WTO, World Bank, and International Monetary Fund. He is a graduate of Stanford University and holds a Master’s Degree in International Affairs from Columbia Universities and a certificate from the Averell Harriman Institute for Advanced Study of the Soviet Union.
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