2002 Survey of Business Owners and Self-Employed Persons (SBO) Lee R. Wentela U.S. Census Bureau - Company Statistics Division ALA 2008 Midwinter Meeting Pennsylvania Convention Center Philadelphia, PA, January 14, 2008

2 ALA 2008 January 14, 2008 Survey of Business Owners Formerly the Surveys of Minority- and Women-Owned Businesses 7 Part of the Economic Census required by law to be taken every 5 years for years ending in “2” and “7” 7 Provides data for businesses and business owners by Gender Hispanic or Latino origin (May be of any race) Race

3 ALA 2008 January 14, 2008 Survey of Business Owners (cont.)  Established in 1969 by the same Executive Order that created Dept. of Commerce’s Minority Business Development Agency (MBDA)  Data compiled from several sources IRS business income tax returns Other Economic Census reports Mailout/mailback survey  Conducted on a company or firm basis rather than individual locations of a firm

4 ALA 2008 January 14, 2008 Which Businesses Are Included Includes all nonfarm firms operating during 2002 with receipts of $1,000 or more that filed tax forms as: Individual proprietorships Partnerships Any type of corporation

5 ALA 2008 January 14, 2008 Which Businesses Are Excluded Excludes firms classified as: Crop and animal production Rail and scheduled air transportation Postal service Funds, trusts, and other financial vehicles, except real estate investment trusts Religious, grantmaking, civic, professional, and similar organizations Private households Public administration

6 ALA 2008 January 14, 2008 Definition of Hispanic or Latino Business Ownership Defined as owning 51% or more of the stock or equity in the business.

7 ALA 2008 January 14, 2008 Categories of Hispanic or Latino Business Ownership Hispanic or Latino origin -Hispanic -Non-Hispanic Gender -Male -Female -Equally Male-/Female-Owned

8 ALA 2008 January 14, 2008 Categories of Hispanic or Latino Business Ownership (cont.) Detailed Hispanic or Latino categories -Mexican, Mexican American, Chicano -Puerto Rican -Cuban -Other Spanish/Hispanic/Latino

9 ALA 2008 January 14, 2008 Categories of Other Business Ownership Race -White -Black or African American -American Indian or Alaska Native (AIAN) -Asian -Native Hawaiian or Other Pacific Islander (NHPI)

10 ALA 2008 January 14, 2008 Categories of Other Business Ownership (cont.) Other -Publicly held and other firms not classifiable by gender, Hispanic or Latino origin, and race For respondent firms only -Veteran -Service-disabled veteran

11 ALA 2008 January 14, 2008 Most Significant Changes in 2002 Ethnicity and race questions were modified to meet Office of Management and Budget (OMB) guidelines. Allowed an individual business owner to self-identify with more than one racial category.

12 ALA 2008 January 14, 2008 Most Significant Changes in 2002 (cont.) North American Industry Classification System (NAICS) replaced the Standard Industrial Classification (SIC) system used in previous surveys.

13 ALA 2008 January 14, 2008 New Owner Characteristics Data Collected in 2002 Age Education level Veteran status Primary function in the business Average number of hours worked per week Whether the business provided the owner’s primary income source

14 ALA 2008 January 14, 2008 New Business Characteristics Data Collected in 2002 Year the business was originally established, purchased, or acquired Home-based Family-owned Franchise Source(s) of capital used to: -start/acquire the business -expand/improve the business Types of customers Types of workers

15 ALA 2008 January 14, 2008 Publication Levels - Businesses  Summary statistics at the U.S. level and at the State level by 2- and 3-digit NAICS codes on the total number of firms by gender, Hispanic or Latino origin, and race; sales and receipts, employees, and annual payroll  U.S. level data by employment and receipts size of firm  Selected metropolitan areas, counties, and places with 100 or more women- or minority- owned firms

16 ALA 2008 January 14, 2008 Publication Levels – Characteristics of Respondent Firms  U.S. level by kind of business, gender, Hispanic or Latino origin, and race  U.S. level by employment and receipts size of firms

17 ALA 2008 January 14, 2008 Publication Levels – Characteristics of Owners of Respondent Firms  U.S. level by kind of business, gender, Hispanic or Latino origin, race, and business interest

18 ALA 2008 January 14, 2008 SBO Includes Firms With Paid Employees and Firms With No Paid Employees 2002 All firms (millions) Sales and receipts (billion dollars) Total U.S. firms23.022,604 Employer firms5.521,836 Nonemployer firms

19 ALA 2008 January 14, 2008 Growth of U.S. Firms All firms Percent change Number (1,000,000) Receipts (trillion dollars) Includes firms with paid employees and firms with no paid employees.

20 ALA 2008 January 14, 2008 Growth of Hispanic-Owned Firms All firms Percent change Number (1,000)1,5731, Receipts (billion dollars) Includes firms with paid employees and firms with no paid employees.

21 ALA 2008 January 14, 2008 Percent Change Comparison from 1997 to 2002 by Group 1 1 American Indian- and Alaska Native-owned businesses have been excluded due to noncomparability. * Denotes that the percent change for NHPI-owned firms’ receipts was not statistically significant.

22 ALA 2008 January 14, 2008 Growth of U.S. Employer Firms Firms with paid employees Percent change Number (1,000,000) Receipts (trillion dollars)

23 ALA 2008 January 14, 2008 Growth of Hispanic-Owned Employer Firms Firms with paid employees Percent change Number (1,000) Receipts (billion dollars)

24 ALA 2008 January 14, 2008 Percent Change Comparison from 1997 to 2002 by Group 1 1 American Indian- and Alaska Native-owned businesses have been excluded due to noncomparability. * Denotes that the percent changes for Black-owned employer firms and Asian- and NHPI-owned employer firms’ receipts were not statistically significant.

25 ALA 2008 January 14, 2008

26 ALA 2008 January 14, 2008 Growth of Hispanic-Owned Firms by State All firms by state Percent change California427,678336, Texas319,340240, Florida266,688193, Includes firms with paid employees and firms with no paid employees. Firms with more than one domestic establishment are counted in each geographic area in which they operate, but only once in the state total.

27 ALA 2008 January 14, 2008 Combined Statistical Areas (CSAs) With the Largest Number of Hispanic-Owned Firms: 2002 CSA Firms (number) 1 Los Angeles-Long Beach- Riverside, CA277,858 New York-Newark-Bridgeport, NY- NJ-CT-PA211,024 Houston-Baytown-Huntsville, TX75,562 1 Includes firms with paid employees and firms with no paid employees. Firms with more than one domestic establishment are counted in each geographic area in which they operate, but only once in the U.S. total.

28 ALA 2008 January 14, 2008 Counties With the Largest Number of Hispanic-Owned Firms : 2002 County Firms (number) 1 Los Angeles County, CA188,422 Miami-Dade County, FL163,187 Harris County, TX61,934 Bronx County, NY38,324 Queens County, NY35,195 1 Includes firms with paid employees and firms with no paid employees. Firms with more than one domestic establishment are counted in each county in which they operate, but only once in the state total.

29 ALA 2008 January 14, 2008 Cities With the Largest Number of Hispanic-Owned Firms: Includes firms with paid employees and firms with no paid employees. Firms with more than one domestic establishment are counted in each city in which they operate, but only once in the state total. City Firms (number) 1 New York, NY129,412 Los Angeles, CA84,629 Houston, TX41,753 Miami, FL35,887 San Antonio, TX29,654

30 ALA 2008 January 14, 2008 Distribution of Hispanic-Owned Firms by Kind of Business: F irms with more than one domestic establishment are counted in each industry in which they operated, but only once in the U.S. total.

31 ALA 2008 January 14, 2008 Industries Accounting for the Largest Receipts for Hispanic-Owned Firms: 2002 Kind of business Sales and receipts (billion dollars) 1 Retail trade40.4 Wholesale trade39.3 Construction31.4 Manufacturing Receipts are for firms with paid employees and firms with no paid employees.

32 ALA 2008 January 14, 2008 Industries With the Highest Average Receipts (in $1,000s) Per Firm for Hispanic-Owned Firms Compared to All U.S. Firms: 2002

33 ALA 2008 January 14, 2008 Percent of Home-based Firms by Receipts Size of Firm: 2002 Receipts size of respondent firms % of Hispanic-owned respondent firms % of all respondent firms Less than $5, $5,000 to $9, $10,000 to $24, $25,000 to $49, $50,000 to $99, $100,000 to $249, $250,000 to $499, $500,000 to $999, $1,000,000 or more7.85.8

34 ALA 2008 January 14, 2008 Percent of Franchised Employer Firms by Employment Size of Firm: 2002 Employment size of respondent firms % of Hispanic-owned respondent firms % of all respondent firms No employees to 4 employees to 9 employees to 19 employees to 49 employees to 99 employees to 499 employees employees or more Includes firms with payroll at any time during 2002.

35 ALA 2008 January 14, 2008 Sources of Start-Up Capital: 2002 Sources of start-up capital % of Hispanic-owned respondent firms % of all respondent firms Personal/family savings Other personal/family assets Personal/business credit card Business loan from govt Govt.-guaranteed bank loan Business loan from bank Outside investor None needed Item not reported5.13.9

36 ALA 2008 January 14, 2008 All U.S. Firms by Detailed Hispanic or Latino Origin: 2002 Detailed Hispanic or Latino origin Firms 1 (thousands) Sales and receipts (billion dollars) Mexican, Mexican American, Chicano Puerto Rican Cuban Other Spanish/ Hispanic/Latino Includes firms with paid employees and firms with no paid employees.

37 ALA 2008 January 14, 2008 Changes for 2007  One comprehensive 2007 SBO form accommodating up to four owners  Nineteen new questions  “Some other race” added to race categories  Opportunity provided to report online

38 ALA 2008 January 14, 2008 Changes for 2007 (cont.)  Protective noise for disclosure avoidance  Estimates for equally Hispanic-/Not Hispanic- owned firms (50% / 50% ownership) are tabulated separately  More Veteran-owned data  More timely data releases

39 ALA 2008 January 14, 2008 Tentative 2007 SBO Calendar  Phase I Mailout June million employers 3 mail report form follow-ups  Phase II Mailout May million nonemployers and new employers 2 mail report form follow-ups

40 ALA 2008 January 14, SBO Results 7 Released on a flow basis from 2010 to 2011 Press events SBO Web site: For access to prepackaged data products and the ability to build custom tables, visit American FactFinder (AFF), the Census Bureau’s online, self-service data access tool at

41 ALA 2008 January 14, 2008 Contact Information Lee Wentela Chief, Economic Census Branch Phone: Katherine Russell Project Manager, Survey of Business Owners Phone: Toll-free number: