black-owned-employer-companies-in-atlanta-surged-after-the-pandemic,-data-show

Black-Owned Employer Companies In Atlanta Surged After The Pandemic, Data Show

For Atlanta-based entrepreneur David Hailey, the pandemic marked both the death of one business and the birth of another.

His first business managed airline inventory using artificial intelligence and computer vision. But when the travel industry tanked, so did his company. He and his business partner went separate ways, but Hailey held on to the idea of using AI to catalogue inventory.

In May 2021, he founded Countifi with two part-time employees, taking the concept of his first business but expanding it to also helping hospitals and universities digitize, organize and tag their inventory through technology.

And Hailey is not alone in starting a business in the wake of the pandemic. Between 2020 and 2021, the total number of firms with employees on the payroll in metro Atlanta grew by more than 5,000, according to an analysis by The Atlanta Journal-Constitution of new census data released in the fall. This is the highest year-over-year growth since at least 2017, when the Census changed how they surveyed business owners.

The largest growth rate between 2020 to 2021 was among Black or African American-owned employer firms in the metro. They increased by 23.4% – from 8,663 to 10,689 businesses. The total number of Black-owned employer firms is much smaller than white-owned ones, but the surge in new starts for African American businesses is eight times the rate at which white-owned businesses grew in that year.

From 2017 to 2021, the rate of new Black-owned employer firms in the metro grew by a staggering 57.3%, the most of any racial group.

However, employer firms represent just a sliver of Black-owned businesses in metro Atlanta. Ninety-seven percent of Black businesses in the region are sole proprietorships, according to the nonprofit Atlanta Wealth Building Initiative (AWBI). It’s unclear how the pandemic affected them because the Census has only released data up to 2019.

Bust, then boom

The new data on the region’s Black-owned employer firms reflects a bust-then-boom trend seen across the country after the pandemic.

In the first months of COVID-19′s spread across the U.S., 41% of Black firms closed between February and April 2020, according to Stanford researchers.

But then came a rebound. U.S. Small Business Administrator (SBA) Isabel Casillas Guzman told The Atlanta Journal-Constitution that we are seeing the highest rate for Black entrepreneurship starts in 30 years.

Experts have different theories about what is behind that growth.

Guzman said the increase could be due to a combination of people accessing startup capital because of an unprecedented injection of cash from the federal government during the pandemic, like the expanded child tax credits. She also said the job market changed as more people left their jobs during “The Great Resignation.”

“I think the pandemic created a shift that encouraged people to go after their dreams, for sure, but there’s also a great opportunity that’s been out there as well,” Guzman said.

Alex Camardelle, vice president of policy research at AWBI, suggested the growth in employer firms could be because the influx of pandemic relief capital allowed businesses to hire for the first time.

He also thinks shifts in the labor market may have made people want to work for a local small business instead of a corporation.

“That may have come as a result of choice, but it also may have come as a result of ‘Well, my company is closing down doors, I need another opportunity,’” he said.

For Hailey, he decided to open a new business because he saw an opportunity in the medical and education spaces due to changes wrought by COVID-19.

“In the hospital space, there were just a lot more assets, a lot more inventory items to count,” Hailey said. “The universities had an opportunity where they were empty and [could] say, ‘Hey, we might have deferred some maintenance, we might have deferred purchasing items, is there a way we can get our hands around what we currently have?’”

His clients include Clark Atlanta University, Duke Raleigh Hospital in North Carolina, North Carolina A&T State University, Emirates Airlines and he has done some work with his former employer, Delta Air Lines.

He is also helping a local Black-owned e-commerce hub, ECOMSPACES, streamline their receiving process. Through Countifi, they can count the items automatically instead of manually.

Credit: arvin.temkar@ajc.com

Credit: arvin.temkar@ajc.com

But building a business while the world came out of the pandemic has not been easy for Hailey.

“It’s been a roller-coaster ride, truthfully,” he said. “But we’re making it.”


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