by Aisha Huertas Michel, Director, Patricia M. Arnold Women’s Rights Project
Discrimination comes in many forms. Sometimes, it shows up where you least expect it or where we may not think to look for it. At first glance, it may be hard to imagine someone (perhaps a woman), who is successful, earning a middle class income, and who owns her own business as someone who faces discrimination. Yet, in 2010 and 2011, MGT of America, a management research and consulting company providing Equal Employment Opportunity studies, produced in two phases the second of two disparity studies for the Virginia Department of Minority Business Enterprise that found discrimination against women and minority-owned businesses in state contracting (the first study, which documented similar discrimination, was produced in 2004).
The results documented that women and minority owned businesses do not receive their fair share of state procurement dollars in relation to their ability and readiness to do the work. For example, between July 1, 2005 to June 30, 2009 women and minority-owned businesses made up 19.50% of the available businesses in the architectural and engineering sector (of which 9.54% were nonminority women), yet they were only awarded 2.69% of the Commonwealths’ architectural and engineering contracting dollars. In addition, 15.16% of the available construction firms were women and minority owned (of which 7.68% were nonminority women), but they were only awarded 1.07% of the Commonwealth’s construction contracting dollars. These studies, and the anecdotal experiences of many women and minority business owners included in the studies, clearly demonstrate that Virginia has failed to provide equal opportunity to these women and minority business owners.
If you are not a business owner, you may wonder why, outside of trying to sympathize, the lack of state-contracts being awarded to women and minority owned businesses is a civil rights issue or how it affects you. It’s a civil rights issue because the disparity found in the studies between the availability and utilization of women and minority owned businesses presents a prima facie case of discrimination. It affects you directly because of the adverse impact this discrimination has on the ability of women and minority owned businesses to contribute to the growth of our economy and tax base.
According to research conducted by the National Women’s Business Council, “women-owned firms have an economic impact of $3 trillion that translates into the creation and/or maintenance of 23 million jobs, 16 percent of all U.S. jobs. These jobs not only sustain the individual worker, but contribute to the economic security of their families, the economic vitality of their communities and the nation.” Research also shows that more women-owned businesses than other businesses offer their employees health insurance, thus helping to provide affordable healthcare for their employees and their families – something that is critically important considering that medical bills are the biggest cause of individual bankruptcies in the United States. Furthermore, women-owned businesses provide a greater share of their earned dollars and their volunteer time to charities. Finally, their workforces are more inclusive of women . In summary, lack of fair competition in state contracting means that women-owned businesses have less dollars to drive their growth and increase employment opportunities, less dollars for philanthropies, and fewer employees with health insurance. The result is a collective loss for the Commonwealth and the country.
From 2005 to 2009, the Commonwealth spent more than one billion tax-payer dollars to pay for prime contracting projects. Of those, only .4% went to businesses classified as “nonminority women-owned” and 1.4% went to all other minority prime contractors (including minority women). That means that 98% of more than one billion dollars went to businesses that did not belong to women or minorities – a disparity that must be rectified both to end the discrimination that persists and to help women and minority-owned businesses grow and contribute to the growth of our economy and our tax base.
The ACLU of Virginia has long worked to end discrimination in Virginia, both blatant and inconspicuous. That is why we are working to address the challenges that the Commonwealth’s women and minority-owned businesses face. To achieve that goal, we will be reviewing the Governor’s SWAM executive order to see what improvements we might recommend; monitoring the progress of the legislative work groups that are looking at the procurement process to ensure that the experience and rights of women and minority-owned businesses are considered; and evaluating what other actions should be taken to end the discrimination in public contracting that disadvantages women and minority business owners and all Virginians.
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