Struggling finances faced by owners of small businesses identifying as LGBTQ in their pursuit of funding
Small business owners, including those who identify as LGBTQ, are facing a host of challenges in the current economic climate, according to a report published by the Movement Advancement Project (MAP) and the Center for LGBTQ Economic Advancement & Research (CLEAR).
Spencer Watson, president and executive director of CLEAR, highlighted that the banking turbulence in March has raised concerns for small business owners, particularly those within the LGBTQ community. He explained that smaller, younger, and revenue-constrained LGBTQ-owned businesses are struggling with additional pressures.
In contrast, the report found that 35% of non-LGBTQ businesses that applied for funding were rejected. This disparity is a cause for concern, as tightening lending standards could put LGBTQ-owned businesses at increased risk, according to Watson.
The report, published in 2021, revealed that 46% of LGBTQ-owned businesses that applied for funding did not receive any financing. This trend continued in a 2022 report, where LGBTQ-owned businesses reported higher rejection rates for funding compared to their non-LGBTQ counterparts.
Much of the funding sought by LGBTQ-owned businesses was through Covid relief programmes, Watson mentioned. However, the main organizations reporting the largest funding setbacks for small LGBTQ-identifying business founders in the 2022 study were not explicitly named in the search results provided.
The small business economy is being hindered by inflation, supply chain disruptions, and labor shortages, as stated. These economic conditions, coupled with higher interest rates, the collapse of smaller community banks, and the resulting constriction of lending, are more detrimental to the LGBTQ community than the non-LGBTQ community, Watson added.
While LGBTQ small business owners are optimistic, they are more likely to report a variety of financial challenges than non-LGBTQ businesses, according to Watson. Six in ten LGBTQ small businesses reported difficulties affording operating expenses over the last year.
Similar themes are emerging in the analysis of the 2022 Federal Reserve's small business credit survey, as mentioned by Spencer Watson. Holly Wade, executive director of the National Federation of Independent Business' Research, expressed concerns about small business owners' future business conditions, not only those who are LGBTQ.
It is important to note that most of the businesses owned by people who identify as LGBTQ are not necessarily oriented towards or servicing the LGBTQ community. This underscores the need for continued support and advocacy for the LGBTQ business community.
As the economy continues to navigate through turbulent times, it is crucial to address the unique challenges faced by LGBTQ-owned small businesses to ensure a level playing field for all entrepreneurs.
Read also:
- Deepwater Horizon Oil Spill: BP Faces Record-Breaking Settlement - Dubbed 'Largest Environmental Fine Ever Imposed'
- Meta Unveils Ray-Ban AR Display Sunglasses; TikTok Agrees to $200 Million Deal
- Historic downtown temples to receive restoration funds totaling over 25 million pesos
- Cars' Environmental Impact Explained
