Student research shows difficult road for POC, women business owners

Easing of regulations could encourage growth of businesses owned by marginalized community members, according to ASU economic analysts

Cities across the country could have more minority-owned businesses if they eased policy and regulation related to starting one, said an economist who analyzed research from ASU's Center for the Study of Economic Liberty.

The Center for the Study of Economic Liberty produced the Doing Business in North America (DBNA) Report which is annual, student-led research ranking 134 cities across the U.S., Canada and Mexico based on "how easy it is to set up, operate and shut down a business."

Chandler ranked the best of all Arizona cities in the study at spot 13, followed by Mesa at spot 34, Phoenix at spot 36 and Tucson at spot 45.

The student researchers found that regulations could be eased on policy addressing the time, costs and paperwork required in the process of starting a business, as well as easing the accessibility of information about how the process actually works.

Alicia Plemmons, an assistant professor at Southern Illinois University Edwardsville, presented her analysis about this year's (DBNA) report during a webinar hosted by ASU on Oct. 19.

Plemmons, who specializes in occupational regulation and taxation, said the DBNA project is special because it is "one of the only data sets" focusing on business policy at a city-level.

"We have more information than we have ever had before, but the problem is everybody's looking at state-by-state variation," Plemmons said.

Mason Hunt, who works at ASU as a project coordinator on the DBNA report, said specific cities were chosen for analysis based on population.

"It's really hard to find some of these local regulations, so we try to provide a one-stop-shop where all this data is available for people to look up," Hunt said. "We hope it encourages competition and allows researchers and policymakers to kind of incorporate this data into their policymaking."

Plemmons said she noticed the cities that do well in promoting minority business ownership usually have easy-to-navigate websites providing business owners the resources they may need. In addition, she said business fees which more proportionally fit the average income in the area played a role in easing the process of starting a business.

Jill Buschbacher, a program manager in Tempe's economic development department, said the city tends to direct struggling business owners to grant programs, some of which address the financial hardship caused by COVID-19. There are several pages on the city's website that help local business owners navigate through the start-up process.

Plemmons said it is important to examine local business policy to ensure minority business owners won't continue to face discrimination.

"(Small businesses) didn't have the same representation 100 years ago, when there might have been more barriers and before the Civil Rights Act," Plemmons said. "The world in itself has shifted, but a lot of these laws (business regulations) were started long before the world has shifted."

Phil Bradstock, a program manager for Phoenix's community and economic development department, said the city of Phoenix's Small Business Toolbox is a one-stop-shop for Phoenix's local business information and programs.

"We don't charge anything for it, but we have gathered everything together," Bradstock said. "We have relationships with all of these different groups and we can point (business owners) in the right direction and tell you where to go directly."

Michelle Pierson, a deputy director in Phoenix's community and economic development department who coordinates with small businesses, said the phone number provided on the toolbox webpage is the city's most accessible business information resource.

"A live voice can go a long way for these small businesses, because some of them surprisingly don't have access to computers," Pierson said.  

PHXBizConnect is a Phoenix-specific digital platform for grant and business advising programs led by CO+HOOTS that was launched during the COVID-19 pandemic to address economic downturn.

Jenny Poon, founder and CEO of CO+HOOTS, said a digital platform with business resources has been especially important in helping ensure minority businesses have access to support that caters to their needs.

"Traditionally a lot of these programs and grant programs, funding programs, resource programs have been built but not actually reached the people that need them most," Poon said. "That is the big purpose of this platform is to make sure that these resources are available, make sure people of color and women know that these resources are available and that we are specifically catering content and resources and direct support for them."

StartUpPHX also provides a space where local business owners can be mentored and share ideas with other business owners. The program is overseen by the Phoenix Public Library in partnership with ASU's Entrepreneurship & Innovation Group and Phoenix's community and economic development department.

While the DBNA research team does not critique public policy, Hunt said he hopes the research will encourage conversation and change related to local business regulation.


Reach the reporter at awaiss@asu.edu and follow @WaissAlexis on Twitter.

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