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Ownership matters

Evidence shows that business owners of color are more likely to train, hire, and promote workers of color than are their white counterparts. The Twin Cities have several high-quality community-based organizations delivering entrepreneur training and supports to minority-owned businesses, particularly in geographic areas that are economically challenged. The Neighborhood Development Center (NDC), Northside Economic Opportunity Network (NEON), and Metropolitan Economic Development Association (MEDA) have collectively trained thousands of entrepreneurs, supported hundreds of businesses, and helped advance growth and employee hiring among many of those firms. While providing important resources and benefits, much of these organizations’ efforts are on retail businesses that often will not grow to be large job generators.

In the Central Corridor, the Business Resources Collaborative (BRC), a collection of business owners, association representatives, and public and nonprofit partners, has developed a strategy for growth aimed at mid-sized businesses already working along the CCLRT line. The strategy calls for investment, coupled with technical assistance, aimed t mid-sized firms with growth potential. This has an implicit expectation to drive racial equity, in that the target for employee hiring would be residents living in or near the corridor. However, there hasn’t been an explicit call for hiring people of color as part of the strategy. The operational challenges are to raise ample investment funds, identify businesses ready and willing to expand with ownership capital, and create customized training and hiring pipelines for each business expansion to ensure that residents of color are the first in the hiring queue.

Finally, there are new cooperative ownership models that show promise for equitable job creation for a competitive economy. Cooperative ownership is often only understood as a housing organization or a grocery co-op, rather than as a model for goods-producing firms or as a way to generate equitable employment. Nationally, examples of cooperative ownership as a vehicle for equitable job creation are emerging. One of these examples is the Evergreen Cooperative Initiative in Cleveland, OH. Evergreen Cooperatives include institutional laundry service, solar energy installation, and greenhouse food production – all servicing local organizations and build on cooperative ownership structures in which employees have ownership stake in the enterprise. Here in the Twin Cities, there are emerging efforts to strengthen community ownership of real estate and business developments in neighborhoods around the region. Many of the examples at hand are found in more affluent neighborhoods and may not prove to be job generators. However, there are opportunities in lower-income neighborhoods to use cooperative ownership as a tool for increasing equity among low-income workers and people of color.

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