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Abstract
Using 2006–2010 American Community Survey data and a multilevel research design, this study examines how the spatial concentration of African Americans within local labor markets is associated with the probability of self-employment and job earnings from business ownership. We find a negative relationship between the spatial concentration of African Americans and their business ownership in Miami, but not in Atlanta. In Detroit, a higher percentage of US-born African Americans in the local labor market is actually associated with a higher probability of business ownership. The relationship between the percentage of African Americans and job earnings also differs across the three study areas. These results suggest that the relationship between racial/ethnic concentration and African American entrepreneurship is highly contingent on the economic conditions and demographic composition of local labor markets.
Notes
1. Due to space limitations, descriptive statistics for both individuals and the local labor market (here measured as public use microdata areas (PUMAs), discussed as follows) for each of the three study areas are not provided; however, they are available upon request.
2. Due to the diversity of service industries, we further divide the service sectors into producer services (including information, communication, finance, insurance, real estate, professional, and management) and social services (including those supportive sectors in education, health care, and personal services). Public services are not included because the self-employed labor force or business owners are not directly employed in this sector. In addition, the public service sector has a very small share and little spatial variation across PUMAs.