African American Businesses and the Struggle for Equity in the U.S.

African American businesses did not just become vulnerable in 2020. In addition to facing greater than average rates of pandemic onset closures, African Americans have confronted persistent barriers along the path to becoming ‘their own boss.’^[10] Racist resentment has been a pervasively debilitating factor limiting the achievements of self-employed Black workers in the U.S.^[11] During the post-bellum period, businesses owned by African Americans, particularly those that were viewed as successful, threatened a rigid stratification system that placed people of African descent at the bottom of the social hierarchy.

At a time when the majority of employed Black people were hired as domestic servants, agricultural workers and manual laborers, African American business owners were living contradictions of those expectations.^[12]The bitterness their presence stoked, whether in the northeast, midwest or the American south, endangered the existence Black business owners as evidenced by, among other examples, the life story of Ida B. Wells.^[13] This investigative journalist, and formerly enslaved person began her career in anti-lynching advocacy after Thomas Moss, Calvin McDowell and Henry Stewart were killed by a White mob in 1892. These men were close friends of Wells’ and joint owners of the People’s Grocery Company which competed with nearby White counterparts in Memphis, Tennessee.^[14]

Murder and the destruction of Black-owned businesses by racists motivated African Americans to flee communities that were much more racially heterogeneous during the early 1900s.^[15] These actions led to the establishment of large, segregated Black communities that were served by thriving Black businesses yet still vulnerable to the aggression of neighboring residents. During the post-Reconstruction era, entire Black towns, many of which were considered economically independent and phenomenally successful, were demolished because of this hatred.^[16] One of the most notable of these attacks took place in 1921 in the Greenwood District of Tulsa, Oklahoma, now better known to the general public as “Black Wall Street.”^[17]

A lack of proximity and the potential for retaliation from White competitors has meant that African American entrepreneurs of the past have, typically, been “detoured” from operating business in segregated, non-Black neighborhoods.^[18] Around the turn of the 20th century, scholars such as W. E. B. DuBois^[19] and Henry Minton^[20] were researching the specificities of post-slavery Black entrepreneurship. Where historians have generated useful insights into African American entrepreneurship in the U.S., pioneering social scientists and other scholars have struggled to convey the full complexity of the Black American experience.^[21]

Frameworks such as ‘middleman theory’ for example, have run into roadblocks by not differentiating between the experiences of multigenerational U.S. born Black people who have not “sojourned from country to country” as immigrants from Asia, Latin America and other parts of the world have.^[22] The analytical asymmetry that overlooking chattel enslavement, mob rule and the impacts of institutional racism caused helped promote ideologies of Black victim blaming in writings that posited any gaps in entrepreneurial achievement between African Americans and other non-White and non-Christian immigrants to the U.S. are the fault of Black culture rather than structural barriers.^[23] This orientation then generated counter arguments that folded into consideration the barriers African Americans had to overcome to own their own businesses and concluded that neither culture or motivation were discrepancies.^[24]

Institutional racism, whether adequately attended to by scholars of African American businesses or not, remained unthwarted in the following decades of U.S. Black life. Discriminatory practices in lending and real estate sales such as the redlining of Black neighborhoods blocked access both to mortgages and business loans over decades, resulting in under capitalized businesses, devaluation of home values, and the systematic denial of wealth building opportunities.^[25] Cooperation between insurance companies and banks in particular has shaped the availability of safe and sustainable housing for Black Americans and home ownership acquisition more specifically.^[26] Federal housing legislation did not sufficiently mitigate the corrosive actions of banks and insurance companies that harmed Africa American communities across the U.S.^[27] Black business ownership has not been immune to the persistent economic vulnerability that these practices have generated in their communities.

Despite, or perhaps because of the hurdles African Americans had to jump over to achieve their entrepreneurial dreams, Black business owners are frequently viewed as trailblazers in their local communities.^[28] Being seen as sources for consistency and care, as well as employment, strengthens the relationship between businesses and communities – developments that enhance a sense of cultural significance. Moreover, because entrepreneurship has been viewed as a “pathway to self-reliance,” it has emerged as fundamental to both community identity and the contours of Black urban life during the latter portion of the 20^th century.^[29]

That said, there has never been a consensus among African Americans about what role Black owned businesses should play within their communities. Some segments have adhered to the ‘Black capitalism’ orientation that President Richard Nixon promulgated during the 1970s. Ideas about subsidizing businesses through tax breaks and other incentives have led to public partnerships such as enterprise and opportunity zones.^[30] The “narrative of emancipatory commercialism” positions Black businesses as the solutions for poverty and inequality in African American neighborhoods.^[31] Opposing perspectives point to the limitations of privileging Black entrepreneurship and wealth accumulation for individual households as a primary force for undercutting structural racism.^[32] These countering views include historical examples of African American business people exploiting their communities.^[33] Additional researchers use these types of data to advocate for reparations for African Americans^[34] and one article in the Science and Social Medicine journal ties reparations to Black COVID-19 virus impacts specifically.^[35]

Debates aside, this legacy of struggle and inequality has left deep economic scars in Black communities and along the landscape of Black entrepreneurial achievement. Racism has denied individual Black households of more than $156 billion dollars due to discriminatory asset devaluation.^[36] In D.C. specifically, White Americans have 81 times the wealth of African American households according to a 2016 report.^[37] Related to these systemic inequalities, African American owned businesses encounter greater difficulty accessing federal aid which would enable their businesses to survive the most severe economic downturn since the 2007-2009 “Great Recession.”^[38] Problems accessing capital and federal relief have contributed to higher failure rates for Black-owned businesses, twice that of White-owned businesses.^[39] These conditions have implications for the two cities this pilot study focuses its attention on: Baltimore and Washington, D.C.

Both cities have large African American populations but business ownership lags far behind the representation of Black residents as a percentage of the population. As reported by the U.S. Census Annual Business Survey in 2017, only 9.8% of the businesses in the District, and 3.0% of those in the Baltimore-Towson-Columbia, Maryland metro area were Black-owned.

These businesses are heavily clustered in service-oriented sectors of the economy: professional, scientific and technical services; healthcare and social services; retail trades in the District, with a much weaker representation of Black-ownership in the greater Baltimore metro area in  healthcare and social assistance; professional, scientific and technical services; and transportation and warehousing.

Table 1. Black-owned businesses with employer firm data for the District of Columbia and the greater Baltimore metropolitan area. (Data from the 2018 Annual Business Survey table AB1800CSA01^[40])

The current figures on business ownership by race for Baltimore City, which represents a subset of the metro area business community are difficult to calculate because of differences in the way that small businesses are counted by distinct survey methods. In 2012, however, the U.S. Census Survey of Business Owners, including both employer and non-employer firms indicated that 27,673 of the 50,735 firms in Baltimore City – 55%, were minority-owned.^[41]

The Cultural Significance of Place in Baltimore and D.C.

Our examination of the COVID-19 pandemic’s impact on African American businesses in Baltimoreand Washington, D.C., focused on two areas within each city. In Baltimore, we focused our inquiry on Black-owned businesses in West Baltimore, portions of which were added to the National Register of Historic Places by the Baltimore Commission for Historical and Architectural Preservation in 2004.^[42] The neighborhoods of West Baltimore include Druid Heights, Harlem Park, Madison Park, Mable Hill, Sandtown, Upton, and others, some of which are connected via Pennsylvania Avenue, the historic economic and cultural hub of that vicinity. The Royal Theater, formerly known as the Douglass Theater which opened in 1922, was an important institution associated with the vibrant history of this community. It was demolished in 1971 but the dream of reopening it is one held by many local residents.^[43]

 “Old West” Baltimore consists of 175 blocks that have been linked to formerly enslaved African Americans since the late 19^th century as a home to both the Black working class and those with elite status. This is a community associated with such notable Baltimoreans as performing artists Cab Calloway, Billie Holiday and Chick Webb, as well as the Mitchell family political dynasty, and the first African American supreme court justice, Thurgood Marshall.^[44] So many Black-owned businesses dotted the area – African American insurance companies, doctor’s offices and many others including the Associated Colored Orchestras located at 1503 Pennsylvania Avenue during the 1940s.^[45]

For the D.C. portion, we turned our attention toward Shaw/Greater U Street and adjacent communities located within the NW quadrant. This historic area, parts of which are euphemistically referred to as Black Broadway, includes U Street, Georgia Avenue, 7^th and 9^th Streets, and Florida Avenue, among other intersecting streets. The importance of this corridor also stems from an association with vital African American institutions such as Howard University Hospital, which was known as Freedman’s Hospital up until 1975,^[46] as well as Howard University and The Howard Theater. The history of segregation connects the latter to a series of “sister theaters” including the Apollo in Harlem, the Earl in Philadelphia, the Regal in Chicago, and the Royal in Baltimore.^[47]

The areas within Shaw and around Howard University in Washington, D.C. have connections to Black experiences that also stretch back to the 19^th century. A marked presence of African Americans in the area was noted as early as the Civil War and Howard University was founded in 1867.^[48] Adding to the area’s reputation, luminaries like civil rights icon Charles Hamilton Houston, composer Duke Ellington, and blood bank pioneer Dr. Charles Drew, as well as basketball legends Elgin Baylor and Dave Bing all worked, trained or lived in this historic area.^[49]

Along with the power of history, conditions for residents of contemporary Baltimore and D.C. have both been affected by present-day politics. D.C. residents lack political autonomy due to the absence of voting representatives in Congress. Without complete control over their budgets, gaps exist in the ability of local leaders to shape the destiny of the city.^[50] On the other hand, Baltimore has struggled with a series of scandals that have resulted in criminal charges for mayoral leadership.^[51]

The pace of urban development and displacement, also shaped by policy, are also distinct in each city. Baltimore significantly lags behind D.C. although there have been discussions about development in Upton and other west Baltimore communities for a number of years.^[52] Pennsylvania Avenue or “the Avenue” as it is referred to in the city, has been designated an official arts district by the Maryland State Arts Council with the hopes of using tax incentives and new development to ignite the local economy.^[53]  Finally, Baltimore is 62.7%^[54] African American while D.C. is 47.1% Black.^[55]

In both urban locales, cultural significance is conveyed through this legacy of African American history and contemporary struggles.^[56] The importance of this broader context cannot be overstated but this report discusses additional, more targeted, ways to think about cultural significance and its relevance for businesses in these communities.

Cultural Significance and African American Owned Businesses in Baltimore and D.C.

There are a variety of factors determining the cultural significance of businesses in general and the business owners engaged with for this project in particular. One key criterion for viewing as business as such is the length of time establishments have operated communities. This pilot-study engaged with entrepreneurs who have had a presence in these locations for decades. Stacie Lee-Banks and her sister Kristie Lee-Jones are co-owners of Lee’s Flower and Gift Shop in Washington, D.C., which has been on U Street since 1945. The Redd family began offering their mortuary services in 1973,  Zawadi just celebrated 30 years of doing business on U Street in February 2020 and Avenue Bakery has been on Pennsylvania Avenue since 2007.

These keystone establishments have survived difficult periods in the histories of both cities. Some persisted after the destruction and disinvestment associated with the uprisings of 1968 as well as the more recent disturbances following the killing of Freddie Gray by law enforcement in Sandtown in 2015. Gentrification is another force influencing the staying power of Black owned businesses in both cities; albeit to varying extents.^[57] Redevelopment poses a particular challenge for communities in D.C.^[58]

Whether the ability to remain is caused by viable and loyal client bases or their ability to adapt to changing conditions in the face of dramatic demographic shifts, continuity adds to the cultural value of these businesses. A sense of authenticity can also be imbued and reinforced under these rapidly changing conditions and these are circumstances that transfer meaning to place.

The specific goods and services offered by businesses are useful for assessing their cultural relevance and impacts on place. The availability of products quintessentially associated with the beliefs and practices of Black community members heightens cultural value however there is variety that negates simplistic or stereotypical depictions. Businesses providing food to the communities they serve was a prime example of this. While African American communities are often associated with southern food traditions, this is not the only discernible pattern related to African American food consumption. Health and wellness concerns, as well as relationships and ideologies that connect U.S. born Black Americans to Africa, the Caribbean and other diasporic locales, also shape African American’s relationships to food in ways that have significant cultural impacts.^[59] In this vein, we talked to the proprietors of Capitol Lounge who describe their product as “soul food,” as well as healthy food enthusiast Dominic Nell of City Weeds and BeMoreGreen and filmmaker/business woman Shirikiana Gerima who co-owns Sankofa Video, Books, & Cafe with her husband, filmmaker Haile Gerima. The food choices available at their cafe reflect the geographic diversity of their Black household.

“Afrocentric” gift, clothing and book shops like Sankofa and Zawadi, like businesses that curate African American performing and visual arts, handily meet this expectation as well. Both stores have products that are made by Black film and jewelry-makers, clothing designers, authors, and African-descended artisans and craft persons from around the world. Distributing goods that are directly linked to Black expressive and performative culture holds a lot of salience for cultural significance. These businesses also demonstrate the diversity within populations. Zawadi’s clientele are largely professional African American women. Other businesses, Black-owned distributors of recorded music and urban fashion styles for example, have northworthy levels of cultural gravitas among their key demographic, patrons 35 and younger. 

All of these variables have strong and overlapping cultural implications. Music is a force that brings people together and some of the businesses profiled in this report either sold CDs or used music to commune with patrons and build community ties on a regular basis or during yearly celebrations. Avenue Bakery proprietor Jim Hamlin would hold events with live music or DJs in the courtyard of his store on Pennsylvania Avenue in Baltimore. The owners of Sankofa would have musical performances in the back of their establishment periodically although Shirikiana Gerima reported getting complaints from area newcomers about the noise.

There were also connections between commerce and Pan Africanism, those beliefs and practices that connect people of African descent across national origins, that have important cultural implications in D.C. With its unique inventory and network of patrons, Zawadi is linked to this vibrant and dynamic ideological orientation in a city known for African-centered businesses and religious and educational institutions.^[60] There were a number of businesses of this type on Georgia Avenue near Howard University where Sankofa is currently located. These were in close proximity to the HBCU, and other African-centered businesses including Blue Nile, a shop specializing in herbs, incense and natural foods, and Pyramid Bookstore that is no longer there.

An additional feature fostering cultural significance among businesses is the role they play when momentous events unfold in the communities they serve. This is exemplified in the example of the massive street protests that took place on U Street in D.C. during the summer of 2019 over a threat to a Black-owned business that was not engaged for this project. After a nearby condominium resident attempted to use his influence to end the broadcasting of D.C.’s own go-go music from a Central Communications/Metro PCS store on the corner of Florida Avenue and 7th Street, the store almost closed. When news of Donald Campbell’s woes spread, thousands of local residents peacefully protested over a number of days. Largely composed of Black residents under the age of 40, this specific but large demographic used their power to save a valued community resource – a store that sells cellular phones and related electronic accessories as well as music. These mobilizations became known as the Don’t Mute D.C. Movement.^[61]

In addition to demonstrating diversity within groups, the example above also shows that the availability of familiar, comfortable and welcoming spaces infuses locations with value and meaning. These are the qualities that center barbershops and hair salons in mainstream discussions of African American owned businesses and in American popular culture depictions. In those specific examples, phenotype, in the form of hair texture and the skills required to braid, straighten, cut, intertwine or otherwise style Black hair, has created these homogeneous gathering places where people can “be themselves” away from the gaze of other populations. Services can also be highly specialized. For example, many Black women contend with hair loss for a variety of reasons and A New Image Hair Salon addresses this specific problem. 

A strong presence of businesses that cater to a Black customer base can take on visual significance extending from blocks and streets to entire neighborhoods and this can generate a formidable impact on the culture of the place. For communities that have historically faced discrimination, stigma and disinvestment, common for west Baltimore and greater U Street in D.C., the remaining presence of these kinds of establishments sparks nostalgia by harkening back to a time when these corridors were safe and welcoming places.

Businesses owned by celebrities or highly-respected community members also enhance visibility and cultural importance. Kenneth Brown grew up across the street from the Capital Lounge, the Pennsylvania Avenue bar and restaurant he owns. Proximity to vital community institutions is a related characteristic to note. Both of the communities we looked at for this study had hospitals, schools, theaters and hotels that either served or were run by African Americans. These histories convey meaning and these landmarks become synonymous with the identities of communities from within and the perspectives of those who live elsewhere.

The tenor of the relationships that are formed between business owners and the people they serve in neighborhoods is another indicator of cultural significance. This characteristic was conveyed in conversations with a number of project participants who shared earning the respect of patrons through acts of kindness to staff and surrounding community members . Forming ties with houses of worship was another way these relationships were solidified. Samuel Redd of Redd Funeral Services discussed the many charitable activities his business supports in the Sandtown, Baltimore area.

Another way of understanding the link between cultural significance and business is to imagine its disconnect in communities. The replacement of African hair braiding shops with tanning salons and the shuttering of spaces where jazz or go-go music are performed live can signal decline. Such a dearth can result in cultural voids, a potential lack of pivotal services, as well as a loss of identity. This concern mobilized thousands to save go-go from being muted in the city. The displacement of most go-go music performance spaces into neighboring Prince George’s County, Maryland, has born out this fear.^[62]  Jazz clubs have also closed in the wake of redevelopment and the COVID-19 virus.

Context is an important consideration in analyses of cultural significance and Black businesses. This literature review has shown how, for Black business owners, policies and practices of the past have placed constraints on the availability of the typical resources self-employed Americans would require to achieve success. Discrimination and segregation have shaped the contours of Black entrepreneurship in each series of Baltimore and D.C. neighborhoods. While these processes have fashioned both areas into havens for African American citizens to live relatively autonomously, both areas have been disinvested in historically. The consumer base therein, moreover, has low rates of wealth accumulation.

It is because of these conditions that African American residents were able to engage in economic activity unrestricted by racist practices that prevented them from being hired, receiving reliable service or even touching the items they wanted to purchase. In essence the existence of communities like these allowed the population to participate in commercial activity unmolested by the disregard and maltreatment associated with racism.^[63] These are the layered and persistent conditions through which the magnitude of cultural import is forged in these neighborhoods.

Attending to the salience of symbolism is as much of an analytical imperative as considerations of structural inequalities and the historical import. For example, Dominic Nell plans to open his corner store in the spring of 2021. On the road to realizing his dream of offering healthy food options to an ailing community, Nell will be an outlier among Black small scale grocery store owners. An African American store owner may have been a common sight in segregated west Baltimore of old but today, Nell is making strides in an economic niche largely occupied by foreign-born, non Black business owners. 

A similar observation can be made of healthcare providers operating in these communities. Optometrist Jessica McClain is charting new territory as an African American optometrist. During segregation these kinds of practitioners were lifelines for vulnerable Black communities. Today, with statistics showing positive maternal and pediatric health outcomes significantly tied to receiving care from Black doctors,^[64] these types of businesses are not only culturally and historically consequential, they can also promote health and wellness within entire communities.

Another consequential aspect of context is the exceptional political moment the U.S. is currently experiencing and its bearing on culture. The movement for Black lives has added a sense of urgency to the need to address the legacy of inequality. Phrases like institutional and structural racism, racial equity and microaggressions have become commonplace in the American lexicon. Across the country, leaders from the private sector and governing municipalities are discussing and implementing innovative policies to alleviate the harm of racism and the issue of entrepreneurship has not gone unnoticed in these social justice considerations.  

A reinvigorated focus on Black owned businesses has been spearheaded in corporate initiatives and popular culture messaging in the aftermath of Breonna Taylor and George Floyd’s deaths at the hands of law enforcement. The National Basketball Association pledged $300 million to support Black businesses across the U.S.^[65] and singer/actor Jennifer Hudson is the face of MasterCard’s $500 million campaign to help businesses run by African American women.^[66] Megastar Beyonce began her Black Parade charity in 2020 to drive customers and resources toward Black-owned businesses^[67] and entrepreneur Aurora James founded the ‘15% Pledge’ during the same year.^[68] This fashion designer’s campaign asks retailers to reserve at least 15% of their shelf space for African American brands and has garnered the participation of Macy’s, Sephora, West Elm and  Bloomingdales.^[69]

These are a few of the campaigns that have emerged within the last year to support entrepreneurship and encourage social justice in the wake of national responses to police brutality. These examples don’t include the additional many grassroots efforts to promote community-based development and Black owned businesses. The actual impacts of these myriad interventions awaits assessment.

In summary, the idea of businesses being culturally significant or culturally based is conveyed by location, history and the political-economic contexts in which these businesses were established and/or function. The specific goods offered to patrons are additional factors influencing cultural considerations. Particular value is generated when products and services are linked to tastes, needs and practices that are tied to the African American experience. As always, this is a determination that should be problematized in recognition of diversity among the Black urban populations examined for this pilot study.

All of the businesses profiled in this report are culturally significant. In addition to their location and connection to the history of these places, along with their role as purveyors of goods and services that are uniquely tied to the needs, beliefs and practices of the African American populations they serve, these men and women are taking an exceptional approach to earning an income. They are walking a path that has fostered both admiration and resentment, depending upon the gaze that scrutinized and evaluated their actions.

Whether the functioning of these businesses is oriented around benefits that are tangible or symbolic for their communities, this project highlights the impacts of the COVID-19 virus on a sample of African American entrepreneurs in Baltimore, MD and Washington, D.C. It is our hope that this exploration increases the understanding of how valuable these businesses are – particularly at this time in U.S. history. The data we have amassed also strengthen insights into the powerful legacies of history and structural hierarchies on policy and culture.