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PolitiFact Florida: Do Hispanic entrepreneurs start 3 times as many businesses as white males?

By Allison Graves
Democratic gubernatorial candidate Chris King gives a campaign speech at the Florida Young Democrats Convention in Tampa on May 20. (OCTAVIO JONES | Times)

Chris King, a self-proclaimed progressive entrepreneur, tied Florida’s economic well-being to the prosperity of immigrants at a recent forum with fellow Democratic candidates for governor.

King offered an eye-popping statistic comparing Hispanic immigrants to working white men to prove his point.

"Well, Hispanic entrepreneurs, those who have immigrated from Spanish-speaking countries, often start three times as many businesses as white males," King said at a forum hosted by the Florida Democratic Party on Oct. 28. "So, we have a need that they fulfill, and this is a governor who is going to communicate that constantly."

We wondered about his statistic. A spokesperson for King’s campaign clarified that he was referring to the rate of growth in the number of businesses started by these demographics, not the raw number of total businesses started.

After some digging, we found a lot of data that speaks to the fact that Hispanic entrepreneurs are opening businesses at a faster rate than the non-Hispanic white population nationwide.

King campaign manager Zach Learner sent PolitiFact Florida a few pieces of evidence to support this claim, but most of the data is almost a decade old or does not speak to King’s exact wording.

Remember: He was comparing the growth of businesses started by Hispanic entrepreneurs, which includes men and women, to white men.

We asked the King campaign to clarify whether the candidate was referring to Hispanic immigrants, that is Hispanics who were not born citizens of the United States, or Hispanic entrepreneurs, which could include immigrants and nonimmigrants. We did not hear back.

But we found that the talking point holds up with either reading.

First, we turned to the Census Bureau’s 2015 American Survey of Entrepreneurs, the most up-to-data from the bureau.

This survey, which started in 2014, attempts to produce yearly estimates on businesses and business ownership by demographic groups, and is meant to supplement the Survey of Business Owners, which is only conducted every five years.

The bureau defines Hispanic-owned businesses as those operating in the United States as 51 percent or more of their ownership to be by individuals of Mexican, Puerto Rican, Cuban or other Hispanic or Latino origin.

Based on the most recent information from the bureau, the number of Hispanic-owned businesses with paid employees (owned by men and women) increased by 4.6 percent from 2014 to 2015, or by about 299,000 to 313,000 businesses.

In contrast, the number of businesses owned by white men grew by about 1 percent in the same time span, from 2.91 million to 2.94 million.

So, based on this data, Hispanic-owned businesses grew at a rate about three times faster than those owned by white men. But there are some problems with this comparison.

First off, comparing the growth of businesses started by Hispanic entrepreneurs, which includes men and women, to those started by white men is not an apples-to-apples comparison.

More important to know is that the Census Bureau hasn’t tabulated a male, non-Hispanic white category. In other words, there’s no way to separate white men and Hispanics who identify as white.

"Since Hispanic is defined as an ethnicity and white as a race, there can be double counting within the Hispanic category as the category includes ‘Hispanic white,’?" said Virginia Hyer, a spokeswoman for the U.S. Census Bureau.

So the rate could actually be higher than what King said.

Hyer recommended comparing the "non-Hispanic white" category to the Hispanic category.

Based on data from those categories, the number of non-Hispanic white-owned businesses grew less than 1 percent, from about 4.1 million to 4.2 million. And the number of Hispanic-owned businesses with paid employees increased by 4.7 percent.

That means the Hispanic growth rate for businesses from 2014 to 2015 was more than three times the growth rate for non-Hispanic white businesses opened by men and women.

We also looked at older data that covers a larger time frame from the Census Bureau that support that overall notion that Hispanic immigrants are opening businesses at a faster rate than white men.

According to the 2012 Survey for Business Owners, the number of Hispanic entrepreneurs not born a citizen of the United States increased 28 percent between 2007 to 2012, from 645,000 entrepreneurs to 827,000.

In the same time, the number of white entrepreneurs who are men only increased 6.5 percent, from 11.7 million to 12.5 million. (Unlike the American Survey for Entrepreneurs, the data is not tabulated by non-Hispanic whites, so the total count of white men could include Hispanics who identify as white.)

The growth of Hispanic-owned businesses mirrors the country’s rising Hispanic population.

Hispanics are the second-fastest growing racial or ethnic group, according to the Pew Research Center. Between 2000 and 2016, the Hispanic population grew from 35.7 million to 56.5 million, a jump of more than 50 percent.

Whether looking at just Hispanic immigrants or Hispanic entrepreneurs, King has a point.

We rate this claim Mostly True.

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