Boston’s investment in Black businesses is improving, but inequality remains

The value of contracts awarded to the same companies rose 40 percent from last year, which Wu attributed to the work of partners including BECMA.

In 2021, a city-commissioned report found that only 1.2 percent of the $2.1 billion in contracts Boston awarded to companies went to Black- and Latino-owned businesses over a five-year period, which highlights major differences in the way the city spends money. Companies run by people of color.

Despite the city’s progress Wu acknowledged that there are still many inequality gaps today.

“This is a lot more work,” Wu said. “But today is about recommitting to the work and recognizing that the whole future is ahead of us.”

Wu made her announcement at the council’s annual Mass Black Expo, a conference that focused on the racial wealth gap, along with the various strategies and opportunities Black business owners and residents across the state can use to thrive despite deep-rooted systemic barriers. . About 1,400 people registered to attend the conference, now in its sixth edition, which included seminars on topics including homeownership equity and generational wealth.

In Boston, the black community has long borne the brunt of discriminatory policies that have contributed to years of underinvestment in neighborhoods like Roxbury and Dorchester. Through the practice of redlining, financial services were, for example denied to the residents in these neighborhoods with a large population of people of color.

In 2015, a report from the Boston Fed estimated the average wealth of a Black household at just $8. Later, a 2022 Urban Institute analysis estimated that Black residents have a net worth of $11,000 – compared to white residents’ net worth of about $215,000.

On the first day of the conference, BECMAwhich was created after the release of that of the Fed The controversial Color of Wealth report says it plans to raise $25 million over the next year as part of its goal to close the racial wealth gap. Today, that divide continues to be perpetuated due to the racial discrimination and other obstacles faced by people of color in Boston, researchers say.

The 2020 killing of George Floyd by Minneapolis police, for example, sparked a period of reckoning over racial injustice, including in Boston, where leaders declared racism a threat to public health. A number of initiatives also emerged to reconcile existing differences.

Yet there are many black entrepreneurs in Boston recently told the Globe that a large part of that support has fallen by the wayside, due to a dip in sales and investments.

Massachusetts also has one of the largest racial disparities in homeownership in the country — and those disparities exist at all income levels in the state — despite homeownership assistance programs that help many families buy their first home. a report from last year found.

“The path to economic equality is not easy,” Herby Duverné, CEO of the Windwalker Group, said at the conference. “The disparities we face are deep-rooted and will not disappear overnight. But it is (through) our perseverance and determination that we are making progress.”

Leaders speaking at the event provided guidance and resources to the Black professionals in attendance that would empower them to build equity and grow their wealth.

During a talk on creating and preserving wealth through homeownership, speakers including State Rep. Andy Vargas and MassHousing Chief Executive Officer Chrystal Kornegay encouraged people to ask about available programs that could help them purchase their first home and take advantage of the available subsidies.

“If you don’t ask, you don’t get,” Kornegay said.

Touching the controversial MBTA Community Actthat requires cities and towns in the MBTA’s service area to adopt a new zoning ordinance to allow multifamily housing in densely populated areas, says Emilio Dorcely, the CEO of Urban edgeaccording to the legislation The goal is to maximize the number of options people of color have to become homeowners and build wealth.

The supply problem, he said, is “so great that if we can’t maximize the number of places we can build, we won’t be able to achieve that goal.”

Other conversations focused on the ways Black residents can build generational wealth, such as educating themselves about their financial and social capital, investing in stocks, budgeting, and thinking long-term about protecting their assets to to ensure that the next generation is safe.

Elsewhere, Jeanette Velasquez, founder of Velasquez Tax & Business Services, recommended having a good accounting system and emphasized the importance of financial literacy.

The critical nature of ensuring that the Black community is represented at the table – and that policies and initiatives are focused on building wealth – was a message that resonated loudly throughout the conference.

“Boston will continue to lead by example at a time when we desperately need examples of what it looks like to move forward and not back,” Wu said.

Previous Globe material has been used in this report.

This story was produced by the Globe’s Money, power, inequality team, closing the racial wealth gap in Greater Boston. You can sign up for the newsletter here.

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Shannon Larson can be reached at [email protected]. Follow her @shannonlarson98.