June is Economic Empowerment Month at United Black America. As we come to the collective realization that the American economy has changed forever, African-Americans find ourselves particularly vulnerable. This month, we will offer strategies and tactics on all things financial and economic. Stay up to date and subscribe to our email list here.
Crushing Black Unemployment: The United Black America 4 Part Plan
Its no secret that when the economy catches a cold, the Black economy catches the flu. Well, Black folks – we have Pneumonia. Unemployment is now up to 8.2 percent – from 8.1 percent the previous month. Things with the economy clearly aren’t progressing, and for the Latino and African-American communities, the unemployment rates rose .7 percent and .6 percent respectively.
Clearly, the President and the Congressional Black Caucus has shown Black America that they have nothing for their people by way of economic empowerment. Therefore, its time for us to challenge conventional thinking when it comes to our financial destiny.
With that, here are 4 ways that all of us can survive and even thrive in this Recession.
1. Create and Build Side Hustles: The More The Better
Black unemployment is caused by a lack of diversification in our hustle. We rely on a single job or career to provide us with everything we need. Doing so is like betting your money on a single stock to make you rich. (How you lookin, Facebook shareholders?!)
Make no mistake about it, these are Recessionary Times. Black men and women MUST have at some side hustles if they expect to survive and thrive while the rest of the country goes to hell.
Think of your side hustles as a portfolio of income producing activities. For instance, the average barbers in my hood also sell boot-leg CDs, throw barbecues, is a club promoter, sells (ahem) cigarettes, does T-shit printing, graphic design, tattoos, and runs a mobile car detailing service.
You cannot rely on just your college degree or your athletic abilities to keep you economically viable. Two examples come to mind: George Foreman and Magic Johnson.
Boxer George Foreman didnt rely on his fists to keep him in good financial shape. Today, he is famous for his side hustle -the George Foreman Grill – which has earned him close to $200 million. His other side hustle, The George Foreman Signature Collection clothing line has been flying off the racks since its launch in March 2004.
Magic Johnson’s side hustles have literally kept him alive. Rather than relying on the little bit of change he made as a 13-year NBA veteran, he built Magic Johnson Enterprises; a company with a successful portfolio of national franchises, including Starbucks, Burger King, 24 Hour Fitness, Washington Mutual Home Loan Centers, AMC/Magic Johnson Movie Theatres and T.G.I. Friday’s.
So what can you turn into a side hustle? Do you have a camera and an airbrushed background? Go to the club or to a theme park and take pictures. Do you read tarot cards? Braid hair? Build websites? Cook? These can all be developed into productive side hustles. Have you gotten complements on your style, or have you worked at a high-end clothing boutique? Then become a stylist! Do you know how to use Photoshop? Design CD covers for local musicians. Learn to do piercings, or Design and sell your own line of T-Shirts (See: Swagger Right Clothing and Sleep is For The Rich for inspiration).
Don’t put your eggs in one basket, and keep your portfolio of hustles diversified to protect against risk. In other words, if your hair braiding side hustle slows down, you have event production hustle to fall back on.
2. Create Jobs and Buy Black
A major cause of Black unemployment is the fact that we are the last to get hired and the first to get fired. The solution is to create our own jobs, and support the businesses that create those jobs. Heres how:
Once a side hustle starts to present itself as a real potential money maker, start sharing the wealth. Recruit those close to you to help you expand. Not only will you increase your earnings potential, you will also create jobs for others. According to the SBA , half of all the jobs in the United States are created this way.
Once you have begun to produce and provide goods and services based on your unique passions, talents, or perceived needs and you have started a small scale operation with a handful of employees, the final step is to link up with and patronize other black businesses.
Statistics have shown that only 4% of African American’s dollars are spent with Black owned and operated companies, and in the words of Dr. Jawanza Kunjufu:
“You cannot give 96% of your income away and blame 100% of your problems on someone else”.
If you own a black bookstore, seek out black writers and black owned and operated publishers. If you own a fruit stand, seek out black family farms. If you are a black blogger, seek out black web designers and programmers. Even if you havent launched your operation, seek out and shop black owned and operated companies.
The point is that rather than becoming someone else’s employees, we should be positioning ourselves and our children to be the bosses. Then, when our friends, nephews, sons, daughters and cousins go looking for jobs, we will be the ones who are hiring them.
Support your local hustler.
3. Re-Think Education
When it comes to education, don’t use it to work for someone else but figure out how to make it work for YOU. Be your own boss and the master of your fate.
Black unemployment has been a direct result of our students going into massive amounts of debt in college, pursuing easy majors that provide no real skill, and then dropping out. Let me explain:
Currently, the Top 5 college majors in the United States are
- Business (marketing)
- Political science
- Criminal Justice
The Top 5 college majors in China are
- Information Technology
- Languages (English and Arabic)
The Department of Labor identifies the top 5 sectors that are “projected to add substantial numbers of new jobs to the economy or affect the growth of other industries or are being transformed by technology and innovation requiring new sets of skills for workers.”
- Advanced Manufacturing
- Financial Services
- Geospatial Technology
These numbers tell us that the U.S. economy has a slim chance of ever being as strong and competitive as it has been in the past, since China will begin to take advantage of the global resources that were responsible for American superiority. In fact, before our current middle schoolers graduate from High School, China would have become the worlds largest and strongest economy – and its no wonder. Chinese, Indian, and African students choose to take “hard majors” in science, engineering, technology, and mathematics, while American students (including African-Americans) choose easier majors.
(See: Generation Jobless: Students Pick Easier Majors Despite Less Pay – Wall Street Journal)
Aside from chosing easier majors, another phenomenon of the Depression that we are in is that more and more students say in school rather than trying to enter the job market. In an article written by the Wall Street Journal, David Leonhardt writes
Over the last few decades, the number of teenagers who enroll in college has actually been rising fairly steadily. But graduation rates have fallen. Less than a third of all students who enroll in community colleges with the intention of getting a two-year degree — a degree leading to jobs in nursing, auto repair, preschool education — ever do so at any college, statistics suggest.
The United States still leads the world in getting students to start college, notes Lawrence Katz, co-author of a recent history of education. But we no longer lead in what really matters: educational attainment.
So what we have here is more kids going to college for easier majors to avoid going into the job market, and then dropping out and being forced into it anyway. To make matters worse, these kids end up with high debt and no learned skills that they can use.
The whole purpose of investing in a college education is to leave with skills that you can use – not skills that employers can use you for. For instance, a 6-year degree in Psychology might sound good, but that degree is useless in the streets.
Compare that to an HVAC Journeyman with a two-year certification. According to the Department of Labor, these specialists typically earn $40 to $65 per hour. If you work even a little overtime you can easily make $85K to $100K + a year.
While a degree from a big HBCU might look good, adult educational institutions and community colleges are where its at. There, you can quickly learn skills that you can immediately put to use.
Example 1: Get an eCommerce certificate, then pick up the phone book, call local businesses, and help them build webstores to sell their goods and services online. You will need to know how to cold call, and will have to invest in some tools (business cards, mailouts, maybe a suit), but with so many businesses willing to pay more than $1000 for a one-off service, you will be more than able to recoup your investment.
Example 2: If you can cook and you have a car, deliver lunches. Theres a bro’man that comes through the barber shop at lunch time and delivers plates to the barbers and the customers. I caught up with him as he walked out and he revealed to me he had routes all through downtown. He wakes up at 8, makes around 60 plates, and delivers Monday through Friday. The plates go for $7 each. That’s $420 a day, or $8400 a month gross. All this with two-years of Culinary Arts training
4. Stop Spending Like Stupid
Its no secret that many Black men and women are slap stupid when it comes to spending. Our spending weakens us collectively, since rather than saving and investing to protect us from severe
Depressions Recessions, we are fighting for Jordans and lining up to get ratchet at the club.
I hear brothas and sistas complain about how broke they are, and yet miraculously find the money to fill up Vietnamese-owned nail shops, Arab-owned clothing stores, and White-owned restaurants and nightclubs.
We spend our sanity away trying to imitate the rappers and ballers that we see. Dr. Boyce Watkins, one of my favorite scholars and journalists, offers his perspective in this article entitled Yeah Rapper, Athlete Economic Buffoonery keeps our people Broke;
Mind you, not every person with money behaves in such a ridiculous way, but there is a culture that seems to influence young Black kids to believe that income should be used solely for irresponsible and counter-productive consumption. You are not here to build wealth, become captains of industry, or use your money to improve the world around you.
Instead, you are meant to use your money to become like the “N*gga in Paris” (Jay-Z) who earned $63 million last year, gave only $6,000 to charity, and sings songs about private jets flying over your head. Jay-Z also engages in some principles of wealth-building, but what he teaches our youth will leave them broke – some might even call him a slumlord.
The bottom line is that running away from education and economic responsibility is the best way to run right back toward slavery.
You can’t complain about the White man having his foot on your neck if you laid on the ground and placed your neck right underneath him. All of us have to call out buffoonery when we see it and encourage one another to make better and more productive choices.
It all starts with what you do with your time, your money, and your mind. – Thy Black Man
Most of our disposable income is spent on looking good. In my part of Amerikkka, it’s become a running joke; when it comes to Black men and women, more style often equals less substance. It’s not unusual to see men jumping off the city bus with no job and $200 Jordan’s on their feet, and the ladies in Chanel are usually the most crass and classless.
We would rather buy a Benz than a stock bond. We would rather buy a Long Island Iced Tea than a mutual fund or CD.
Our spending should be limited to 40% needs, 40% investments (including education and startup capital), and 20% wants. Now compare your budget to those numbers. If this aint you, then pay no mind. If not, pull your head out of your ass.
That, Ladies and Gentlemen, is how we can crush Black Unemployment. By building multiple side hustles, building and supporting Black businesses, learning practical skills, and controlling our spending we can single-handedly reverse Black unemployment.
The number of ways to make money are as varied as the people on the planet, so what legal side hustles do you use to make money? How has the recession effected you? What are you doing about it? Are you in college, a graduate, or in trade school?
Drop us a comment, and keep the discussion going in our new Forum.