Poll: Demographically Targeted Assistance Programs Benefit Small Businesses

Washington, D.C.— An opinion poll released today revealed that nearly 30% of women- and BIPOC-owned small businesses have benefited from some form of government-administered, demographically targeted assistance program. 

The survey found that among the small businesses that have benefited from a government program designed to help a specific demographic group, the benefits they received were vital to the health of those businesses. In fact, 24% of respondents said that a government program prevented their business from shutting down, while 14% said the program helped their business obtain contracts. Almost half (42%) said a government program helped them obtain capital to fund their enterprise. Among the small businesses that received publicly funded support, 47% received assistance from a Women’s Development Center and 24% had help from the Minority Business Development Agency (MBDA). 

“Our business has absolutely benefited from programs designed to support people of a particular race or gender,” said Teaera Strum, owner of Strum Contracting Company in Baltimore.  “Without these types of targeted programs I am not sure our business would be where we are today, and I strongly believe that programs designed to support historically disadvantaged groups must continue for the good of small business growth in this country.”

Small businesses are also benefiting from demographically targeted, privately run assistance programs. The poll found that small businesses that received support from private organizations received a range of benefits including small business grants (59%), individual consulting (37%) and/or pro-bono legal advice (18%). Additionally, 27% of survey respondents said the support they received prevented their business from shutting down. 

Small Business Majority’s survey comes in the wake of a string of court decisions that said privately and publicly funded assistance programs designed specifically to aid small businesses that are owned by historically disadvantaged groups including women and minorities are examples of “reverse discrimination” and are therefore unconstitutional. These include decisions that impacted the operations of both the MBDA and U.S. Small Business Administration (SBA), as well as the Fearless Fund, a non-profit designed to support Black women entrepreneurs. Small business owners surveyed do not support these court decisions, with just 35% strongly or somewhat agreeing with the decision against MBDA, 30% strongly agreeing or somewhat agreeing with the decision against SBA and 30% strongly agreeing or somewhat agreeing with the decision in the Fearless Fund case. What’s more, over 70% of small businesses surveyed strongly agreed or somewhat agreed that demographically targeted small business programs should continue.    

“Given that we’ve seen a historically high 19 million new small business filings since 2021 and the fact that women and BIPOC entrepreneurs are the primary drivers of that growth, it’s encouraging to that female and minority small businesses owners are benefiting from various programs offered by both the public and private sectors,” said Small Business Majority Founder and CEO John Arensmeyer. “Unfortunately, a handful of courts are willing to entertain ‘reverse discrimination’ arguments that could stop the growth of these businesses in their tracks. Judges must recognize that claims of ‘reverse discrimination’ ignore the reality that the playing field for small businesses is not equal, and the exponential small business growth we’ve experienced in recent years will be just a blip rather than a sustainable trend if programs intended to benefit women- and minority-owned small businesses are litigated out of existence.”  

For the full poll report, please visit: https://smallbusinessmajority.org/our-research/entrepreneurship-independent-economy/small-businesses-benefit-targeted-grant-and-loan-programs-support-their-continued-existence