Economic Globalization and the Future of Black America
Transcription
Economic Globalization and the Future of Black America
Economic Globalization and the Future of Black America Author(s): James H. Johnson Jr., Grover C. Burthey III and Kevin Ghorm Reviewed work(s): Source: Journal of Black Studies, Vol. 38, No. 6 (Jul., 2008), pp. 883-899 Published by: Sage Publications, Inc. Stable URL: http://www.jstor.org/stable/40035029 . Accessed: 24/01/2013 00:42 Your use of the JSTOR archive indicates your acceptance of the Terms & Conditions of Use, available at . http://www.jstor.org/page/info/about/policies/terms.jsp . JSTOR is a not-for-profit service that helps scholars, researchers, and students discover, use, and build upon a wide range of content in a trusted digital archive. We use information technology and tools to increase productivity and facilitate new forms of scholarship. For more information about JSTOR, please contact support@jstor.org. . Sage Publications, Inc. is collaborating with JSTOR to digitize, preserve and extend access to Journal of Black Studies. http://www.jstor.org This content downloaded on Thu, 24 Jan 2013 00:42:32 AM All use subject to JSTOR Terms and Conditions EconomicGlobalization and theFutureofBlack America Journalof Black Studies Volume38 Number6 My 2008 883-899 © 2008 Sage Publications 10.1177/0021934706290981 ~ http://jbs.sagepub.com hostedat http://online.sagepub.com JamesH. Johnson Jr. University ofNorthCarolinaat ChapelHill GroverC. Burthey III Wharton School,University ofPennsylvania KevinGhorm University ofNorthCarolinaat ChapelHill This articleassesses the AfricanAmericanexperiencewith economic - theincreasing forgoodsand servicesconsumedin tendency globalization incountries theUnitedStatestobe producedoffshore likeMexico,India,and theraciallydisparateeffects of theshiftof blue-collar China.It documents whichbeganin the 1960s and continuesto thepresent, and jobs offshore, American estimates thesize oftheAfrican that is at risk of future population movement ofwhite-collar job lossduetotheoffshore jobs- a post-1990phenomenon.The articleconcludeswith a set of strategiesthatAfrican mustpursueto survive, andprosperin theyearsaheadin Americans thrive, thehighlyunpredictable andturbulent globaleconomyofthe21stcentury. Black entrepreneurship Keywords: economicglobalization;offshore outsourcing; - theincreasing forgoodsand services tendency globalization in theUnitedStatesto be produced offshore in countries consumed like threatens thecurrent andfuture Mexico,India,andChina- seriously employoftheAmerican worker mentprospects (Engardioet al, 2003; Hira& Hira, thateventhemosthighly educated 2005;Prestowitz, 2005).Research suggests Americanworkeris vulnerableto thepowerfulforcesof globalization 2005;Hira& Hira,2005).TheEconomicPolicy 2004;Friedman, (Buchholz, inlong-term for thatthepercentage increase unemInstitute reports, example, with some months or was 6 more) (i.e., greater amongpeople college ployment (299%)thanitwasamongpeoplewith (259%)ora bachelor's degreeorhigher & a highschooldegreeor less (156%) between2000 and 2003 (Allegretto Stettner, 2004). 883 This content downloaded on Thu, 24 Jan 2013 00:42:32 AM All use subject to JSTOR Terms and Conditions 884 Journal ofBlack Studies In thisarticle,we assess theAfricanAmericanexperiencewitheconomic globalization.Specifically,we documenttheraciallydisparateeffectsof the shiftof blue-collar jobs offshoreand estimate the size of the African Americanpopulationthatis at risk of futurejob loss due to the offshore movementof white-collarjobs. We conclude by outliningstrategiesthat AfricanAmericansmustpursueto survive,thrive,and prosperin the years ahead in the knowledge-intensive and speed-driveneconomy of the 21st century. Backgroundand Context Americanworkers'increasingemploymentvulnerabilityin the internationalmarketplaceis rootedin twowaves ofeconomicglobalization.The first wave involvedtheoffshore movementofblue-collarjobs, whereasthesecond wave involvesthe shiftof white-collar 2005). jobs offshore(Ernsberger, The firstwave of globalizationbegan in earnestin the early 1960s and continuesto thisday. Nationally,5.3 millionmanufacturing jobs have been lost since 1979. Roughlyhalf of thisjob loss occurredbetweenJuly2000 and July2003 (CongressionalBudget Office,2004; Press Associates Union News Service, 2003). The Americanpublic's anxietiesabout thefirstwave of globalizationare capturedmost vividly in the experience of one fictionalbut typical displaced blue-collarworker.We'll call him Joe Smith. Joe Smithstartedhis day early,havingset his alarmclock (MADE IN he JAPAN)for6 a.m.Whilehiscoffeepot(MADE IN CHINA) was perking, shavedwithhiselectricrazor(MADE IN HONG KONG). He puton a dress shirt(MADE IN SRI LANKA),jeans (MADE IN SINGAPORE),andtennis shoes(MADE IN KOREA). After inhisnewelectricskillet(MADE IN INDIA), cookinghisbreakfast he satdownwithhis calculator(MADE IN MEXICO) to see howmuchhe couldspendtoday.Aftersetting hiswatch(MADE IN TAIWAN)totheradio to (MADE IN INDIA), he gotin his car (MADE IN JAPAN)andcontinued searchfora good-paying American job. At theend of yetanotherdiscouraging and fruitless day,Joedecidedto relaxfora while.He puton his sandals(MADE IN BRAZIL), pouredhimon hisTV (MADE IN selfa glassofwine(MADE IN FRANCE),andturned INDONESIA), and thenwonderedwhyhe can't finda good-paying job in ... AMERICA. This content downloaded on Thu, 24 Jan 2013 00:42:32 AM All use subject to JSTOR Terms and Conditions et al. /The FutureofBlackAmerica 885 Johnson todisplacedblue-collar hasbeentogo backtoschool workers Ourmantra in the information andre-toolforwhite-collar But,ironically, jobs economy. intheearly white-collar offshore U.S.-basedcorporations beganmoving jobs with low-level 1990s(Friedman, 2005; Hira& Hira,2005).Thisshift began werelessenthusiastic aboutperforming serviceworkthatU.S. workers such credit card in as writing and code, computer processing charges, working customerservicecall centers & Parkhe, Bhaumik, Kanakamedala, (Amoribieta, 2001;Easton,2003;Waldman, 2003).Duringthelate1990s,thetrendaccelcontracted withoffshore vendorsto addresstheirY2K eratedas U.S. firms needs et al., (Amoribieta 2001). programming inaneffort tocutcostsduring thelatestrecession, Morerecently, U.S. corvendors in what is as have offshore known business engaged porations which involves a of business functions, range including processoutsourcing, and customer care sales,marketing, operations, management, supply-chain somestategovernments havecontracted with 2001).In addition, (Bandham, vendorsforvariousservices,notably, call centersforfoodstamp offshore & Prinz, Purinton, 2004). (Mattera, Woolsey, programs is movingupthevaluechain Now,thetrendtowardoffshore outsourcing - whatis functions withinU.S. firmsto higherorder,knowledgeintensive knownas knowledge (Bhandari, 2003). Thisdevelopprocessoutsourcing DeloitteResearch mentis mostevidentin thefinancialservicesindustry. thatpotentially 2.0 millionAmerican jobs in thebankingandsecureports abroad(Rosenthal, ritiesindustries couldbe losttooutsourcing 2003).And that"thetop15 globalfinancial institutions will theTowerGroup estimates offshore outincreaseinformation technology spendingon vendor-direct - representing an increasefrom$1.6 billionin sourcingby 34% annually 2004 to $3.89 billionin 2008" ("TopFinancialInstitutions," 2004). No oneknowsforsurehowmanyU.S.-basedwhite-collar jobs arelikely TheU.S. BureauofLaborStatistics isjustnowbeginning tomoveoffshore. thetrend(U.S. NewsWire,2004). to monitor to gatherdatasystematically ofCalifornia, thatabout14 a University However, Berkeleystudyestimates base- are conmillionU.S. jobs- roughly11% of theU.S. employment in occupationsvulnerableto offshore centrated (Bardhan& outsourcing Kroll,2003). in laser-like withhisemployer recentexperience JimBrannon's captures ofthissecondwaveofglobalization, fashionthereality especiallyas ithas In contrast tothefictional bluemovedupthevaluechaininU.S. businesses. Brannon is a realpersonwholives described JoeSmith, collarworker, earlier, in a largeinformation firm. He was an executive inAtlanta. technology This content downloaded on Thu, 24 Jan 2013 00:42:32 AM All use subject to JSTOR Terms and Conditions 886 Journal ofBlackStudies Atthetopofhiswhite-collar littleabouthisjob. game,JimBrannonworried He was six-figure software an educatedman witha jet-setting successful, couldn'ttouchhim.He job. . . . The vagariesof freetradeandglobalization information techwas,afterall, a vauntedexecutive... in a world-spanning Itwas theblue-collar Joe,Brannonbelieved,who'dwake nology[company]. anddiscoverhisfactory up one morning job hadgoneto MexicoorChina. inFebruary 2002.A letter Brannon, though, experienced justsucha morning orderedhimto clearouthis deskby day'send.Gonewerethefancyoffice, ofinvincibility, andonce-solid beliefintherighteousexpenseaccount, feeling nessofCorporate America. now52,represents oneofthehundreds ofAmerican ofthousands Brannon, white-collar workers whosejobshavedisappeared inthepast3 years.While[his former desiretocutcostswaspartly toblameforBrannon's unememployer's] he saysa majorculprit was offshore 2003). ployment, outsourcing (Chapman, Most economistsdownplaythepublic'sgrowingconcernsaboutoffshoringof white-collar jobs (Drezner,2004; Mann,2003). Theycontend thattheUnitedStateswill developthenextwaveof innovations thatwill createevenbetterand higherpayingjobs thanthoselostto offshore outtheUnitedStateshas demonstrated a highlevelof sourcing.Historically, resiliencein responseto globalization and structural changesin theeconomy.But,severalrecentdevelopments challengeourinnovation capacity andthusourabilityto createthenextwaveofgoodjobs in theyearsahead 2005; Segal,2004). (Engardio& Einhorn, theglobalcompetitive ConsiderthedevelopFirst, landscapeis changing. - China,India,and nations that are and free trade ing embracing capitalism theformer SovietUnion,amongothers(Joseph, Koehler et al., 2004; 2002; these nations have a thatis Krishnan, 2004b,2004c).Collectively, population 10 timesthatof theUnitedStates.Theyproduceannuallyfarmorewelltrained thanwe do as a nation(Krishnan, 2004c).Andtheir collegegraduates the same work as workers for educated American collegegraduates perform abouta tenthof thecost(Beckman,2003; Guerra,2002). Moreover, these countries haveinvested in newtechnological infrastructure and createdthe businessandregulatory to with theUnited environment necessary compete States(Gupta,2003). totheUnitedStateshavemadeup muchofthetalent Second,immigrants in oureconomy. that has driven innovation led manyofthe pool Immigrants that fueled the economic boomof the high-technology start-up companies 1990s (Saxenian,2000). And international students and children of immiare for all of the enrollment growth grants principally responsible nearly This content downloaded on Thu, 24 Jan 2013 00:42:32 AM All use subject to JSTOR Terms and Conditions et al. /The FutureofBlackAmerica 887 Johnson - the training in the physicalsciences,math,and engineering programs and incubators for new advances that lend scientific themselves to grounds - at boththeundergraduate and graduatelevelsof U.S. commercialization highereducation(Ante,2004; Engardio& Roberts,2004; Schemo,2001; "SourcesofVitality," 2001). restrictions the9/11terrorist attacksconstrain Butsecurity imposedafter threaten our theflowof foreigntalentintotheUnitedStatesand thereby of to the next innovators and innovations (Ante, generation ability develop 2004; Johnson,2002; Johnson& 2004; Council on Competitiveness, researchindicatesthatsomeoftheimmigrants Kasarda,2003). Moreover, ofinnovations thatdrovethe1990s whowereengagedin thedevelopment homeandsetting economicboomarenowreturning up businessesthatwill firms in fields like with U.S. -based and nanotechbiotechnology compete 2004; Goswami, 2004; Krishnan, 2004b; Nair, 2004). (Florida, nology firms are mostthreatening, U.S.-based a Third,andperhaps many shifting of their research and activities off(R&D) development significant proportion one ofAmerica'smost shore(Engardio& Einhorn, 2005). GeneralElectric, wasoneofthefirst to establish anoffshore R&D facilrevered firms, companies in The in 2000 John F. Welch India, (Rose, 2002). Technology ity Bangalore, - two and researchers Centrehostsmorethan1,600scientists, engineers, "breakthirdsof whomhave advanceddegrees.Chargedwithdeveloping ofGE businesses," thattranslate intogrowth thecenter technologies through disclosures forresearch anddevelhas"filedmorethan150patent reportedly activities" since2000 ("GE Expands,"2002). opment multinational FollowingGE's lead,a wide arrayof U.S.-headquartered inIndiaandotherdeveloping R&D facilities offshore firms haveestablished nations(Krishnan, 2004a). Muchof theworkin drugdiscovery (bioinformoregenerally), forexample,reportedly andgenomics, matics,proteomics, is shifting toHyderabad, GenomeValley(Iype,2004). India,nicknamed ofthefactthattheUnitedStatesis losingitsinnovation Emblematic capacwhichincluded "theresearch labsthatdeveloped plants, ity,164U.S. chemical foreverything from handsoaptohomeinsulation to[computer] keyingredients haveshutdownsince2001,idlingmorethan120,000workers harddrives," "ofthe120 chemicalplantsbeingbuiltaroundthe 2005).Moreover, (Arndt, worldwithpricetagsof$1 billionormore,justone- a 1,725-acre polyvinyl La.- is intheU.S has chloride China,bycomparison, plantinPlaguemine, on thisshift, Arndt(2005) notesthat"bigger, 50" (Arndt, 2005).Elaborating inthedeveloping worldare markets areoverseas. Newfacilities faster-growing ifnotmoreso." andproductive as thoseinAmerica, oftenas sophisticated This content downloaded on Thu, 24 Jan 2013 00:42:32 AM All use subject to JSTOR Terms and Conditions 888 Journal ofBlackStudies Commentingon how theoffshoremovementof R&D activitiesthreatens the nation's innovationcapacity,U.S. Senator Joe Lieberman stated in a recentreport(Koehleret al, 2004), The innovation infrastructure thatservedus wellin thefaceofless formidable competition is no longersufficient in thefaceof thisnewfierceglobal ofourinnovation infrastructure aredeterioratcompetition. Keycomponents forR&D, thenumber ofscienceandtechnology ingas federalfunding gradin theU.S. continue to decline. uates,andbusinessinvestments He wenton to statethat ourinnovation undermined capacityis further bythemassivebudgetdeficits whichthreaten future in R&D and education,and increaseour investments exposureto currency manipulation by foreignleaders.This subsequently leads to theloss of manufacturing and servicejobs. Ourcompetitiveness is further tradeagreements thatare not adecompromised by international whenourtradepartners failtoliveup totheircommitments. quatelyenforced Whatdoes thisominoustrendportendforU.S. competitiveness in the Arndt asserts the that "for the U.S., (2005) global marketplace? likely resultsare less investment, fewerjobs, and fewerscientific discoveries." thelikelyeffects in thefollowing (2005) characterizes Ernsberger way: In the yearsahead,sizable numbersof skilled,reasonablywell-educated middle-income in service-sector workers safefromforjobs longconsidered - accounting, andriskmanagement, healthcareand law,financial eigntrade information to namea few- couldbe facinglayoffsor serious technology, nationsperform offwagepressureas developing increasingly sophisticated shorework.Theshift a dramatic ofwealthoverthenext portends realignment - valued... at "hundreds ofbillionsofdollars." coupleofgenerations A recentOrganization forInternational Investment (OFII) surveyof morethan100 top-levelexecutivesof majorU.S. subsidiaries of foreign seem to these bleak to companies support prognoses. According theOFII, U.S. subsidiaries of foreign-owned "insource 5.4 millionjobs companies an annual of billion." The OFII $307 supporting payroll Insourcing Survey 2005 was designedto "gaugehowtheUnitedStatesis perceivedas a locationforbusinessinvestment vis-a-visothernations"(OFII, 2005). The surveyresultsrevealedthattheUnitedStatesis perceivedas weak onfourofthetopinvestment locationcriteria: healthcarecosts,laborcosts, This content downloaded on Thu, 24 Jan 2013 00:42:32 AM All use subject to JSTOR Terms and Conditions Johnson et al. /The FutureofBlackAmerica 889 and tax system.The UnitedStateswas ratedstrongin only legal system, andskilledworkforce. Mostofthesurvey onecategory: knowledge respondentsindicatedthattheircompanieswouldincreaseor maintaincurrent intheshortterm(i.e.,thenext12 months), levelsofinvestment buthalfsaid that"theircompanieshave made Chinatheirmostimportant for priority As Goswami(2004) so aptlystated,it increasingly futureinvestments." appearsthatthe"U.S. doesn'tbeckonanymore." RaciallyDisparateEffectsofEconomicGlobalization Economicglobalizationhas touchedall U.S. workersin one way or another 2005; Hira& Hira,2005). ButAfrican (Buchholz,2004; Friedman, Americanworkershave been affectedmoreadverselythanWhiteand especiallyby theshiftof blue-collaror manufacturing Hispanicworkers, RisesFaster," 2003;Johnson, Farrell, ("BlackUnemployment jobs offshore has noted & Stoloff, 1998;Leonardar2003). As one commentator Wright, RisesFaster," 2003), ("BlackUnemployment were2 million blackAmericans infactory In 2000,there working jobs,or of thenation'stotalof 20 millionmanufacturing workers. 10.1percent intheoverall workforceinroughly thesameproBlackswererepresented thatbeganin March2001;sincethen, Thencametherecession portion. or15percent, havedisappeared. White 300,000factory jobsheldbyblacks, in all. Butbecausethey workers lostmanyfactory jobs,too- 1.7million to beginwith, thedamagewas weremuchmorenumerous proportionally less,just10percent. ofBlack workers in themanuOwingin partto thishighconcentration rate(10.8%) was doublethe sector,the Black unemployment facturing rate(5.4%), 6.2 percentage nationalunemployment pointshigherthanthe rate(4.6%), and4.2% percentage Whiteunemployment pointshigherthan theunemployment theHispanicrate(6.6%) in December2004. Moreover, forBlacks(3.2 percentage raterosefaster points)thanitdidforWhites(1.1 point)between2000 and percentage points)andHispanics(0.9 percentage 2004 (BureauofLaborStatistics, 2005). The blue-collar job exodushas hitBlackmenolderthan20 yearsofage and Black youthbetweentheages of 16 and 19 especiallyhard.Between raterosefaster forBlackmenthanforany 2000and2004,theunemployment AndinDecember2004,theunemployment rate other subgroup. demographic This content downloaded on Thu, 24 Jan 2013 00:42:32 AM All use subject to JSTOR Terms and Conditions 890 Journal ofBlackStudies forBlack youth(30.8%) was doublethe rateforWhiteyouth(15.7%) (BureauofLaborStatistics, 2005). Becauseitis a fairly itremainsunclearhowAfrican recentdevelopment, Americanshavebeen affected the movement of white-collar by jobs offshore.To providea perspective on thelikelyeffects, we extracted datafrom theCensus2000 PublicUse MicrodataSampleson theabsolutenumber andpercentage ofAfrican Americanswhowereemployedin white-collar For comparison occupationsmostat riskof goingoffshore. purposes,we also extracted dataontheabsolutenumber ofall U.S. workandpercentage ersemployedin themostvulnerable occupations. In 2000,as Figure1 shows,11.3%(2.2 million)ofall employed African Americans in occupations thatareat risk (19.1 million)wereconcentrated ofgoingoffshore. Blackswerenotas vulnerable as as theU.S. workforce a whole- 13.2% ofall U.S. jobs areat riskofmovingoffshore.1 Butthere werecertainoccupationalnichesin whichBlacks weremorevulnerable thanall U.S. workers: humanresourcemanagement, paralegalsand assisandcustomer care(see Figure1). It is interesttants,andsales,marketing, thespecificbusinessfunctions that ingthattheseoccupations represented to offshore venlargeand smallfirmsalikewereaggressively outsourcing dors.Thus,AfricanAmericanswereslightly morevulnerable to offshore - at leastat the outsource-related job loss thanotherdemographic groups ofthisdecade. beginning Respondingto ExternalThreats How haveAfricanAmericansrespondedin thepast to powerfuleconomicforcesthathaveadverselyaffected thestructure of opportunity for theircommunity? Americans haveresponded Historytellsus thatAfrican and pursuingself-employment as an by beingfarmoreentrepreneurial avenueof upwardmobility(Butler,1991). ThreeexamplesfromAfrican Americanhistory areillustrative. was thefirststatein thenationto emancipate itsslavesin Pennsylvania 1780. Fifty-eight yearslater,a snapshotof AfricanAmericanentrepreneurialism was providedwhen"A RegisterofTradesofColoredPeoplein theCityofPhiladelphia andDistricts" was publishedin 1838.The register listed656 personswhowereengagedin 57 different Included occupations. inthedirectory wereBlackbakers,custombootandshoemakers, bricklayersandplasterers, brushmakers,cabinetmakers,carpenters, caulkersand This content downloaded on Thu, 24 Jan 2013 00:42:32 AM All use subject to JSTOR Terms and Conditions Johnson et al. /The FutureofBlackAmerica 891 Figure1 Totaland Black Employment in Occupationsat Risk ofOffshoreOutsourcing Source:CompiledbyauthorfromCensus2000 PublicUse MicrodataSamples. confectioners themanwhoinvented ice cream), chairbottomers, (including a dentist andtailoresses, (whomanufactured porcelainteeth),dressmakers andcaterers (Minton,1913). plumbers, In themid-1800s,Philadelphia'sBlack businessesserveda primarily WhiteclienteleandsomeoftheBlack-owned businesshadWhiteemployees. Moreover,Blacks controlledsome lines of business.For example, thecatering Blacksreportedly andrestaurant business,which monopolized famousas a cityofgoodfood"(Minton,1913). "made[Philadelphia] The 1920swerealso a periodofrapidBlackbusinessgrowth. Itis interduringthisperiodwas a responseto risingBlack-White estingthatgrowth ofBlacksfromtherural migration antagonisms spawnedbythelarge-scale in 26 majorraceriotsin U.S. Southto theurbanNorth,whichculminated This content downloaded on Thu, 24 Jan 2013 00:42:32 AM All use subject to JSTOR Terms and Conditions 892 Journal ofBlack Studies cities in 1919 (Bates, 1997). These criticaldevelopments "markedthe of the end for Black that relied affluent white businesses on beginning clients."Whiteantipathy towardBlacksled to a growingsentiment in the African Americancommunity to "buyBlack." Black-owned insurance andBlack-owned werean companies newspapers of thisgrowingracial consciousness. the outgrowth Describing African American businesscommunity inthe1920s,one study(Butler,1991)noted, Blackprogress wasparticularly inlifeinsurance: 32firms apparent employed andcontrolled assets ofover$18million in1928 By1930,an 6,000agents estimated intheUnited businesses wereoperating 70,000black-owned States, a 700percent increase over1900.. . . The1920swerethegolden forthe years urban blackbusiness community.2 (p.35) Nationally, manyof theBlack-ownedfirmsestablishedduringthe 1920s werefinancedby churchesand fraternal and patronized organizations by members oftheseorganizations. It is unfortunate thattheGreatDepression muchofthegroundgainedduringthe1920s(Bates,1997). destroyed - roughly1980 to the present - represents The past 20 years a third in and selfperiod AfricanAmericanhistoryin whichentrepreneurship have been embracedas a strategyfor upwardmobility employment shiftin (Daniels,2003). Duringthisperiod,therehas beena fundamental boththecharacteristics ofAfrican Americansmallbusinessownersandthe established (Bates,1997). typesofbusinessventures Whereasthetraditional Black businessownerof theearlyto mid-20th was uneducated, and servedprimarily a Black century undercapitalized, theemergent classofBlackentrepreneur/small businessownerof clientele, thepost-1980 period(a) is collegeeducated,oftenMBA-trained; (b) provides one or moreprofessionalservices;(c) has paid employees;and orraciallydiverseclientele, (d) catersto a nonminority including corporate and government clients.Researchshowsthatthesenewlyemerging firms have been amongsome of the fastestgrowingbusinessesin the nation (Bates,1997;Daniels,2003; Hopkins,2005). set-aside or preferential contributed to Minority procurement programs therapidgrowth of thesebusinesses(Boston,1999). Emblematic of their Black-owned firms importance, nearly40% ofthemostrapidlygrowing theso-called"new gazelles"- indicatedin a recentsurveythatminority set-asideprograms had a "significant" effect on theirgrowth anddevelopment(BostonResearchGroup,2002). This content downloaded on Thu, 24 Jan 2013 00:42:32 AM All use subject to JSTOR Terms and Conditions et al. /The FutureofBlackAmerica 893 Johnson MovingForward effects oftheoffshore Giventheraciallydisparate movement employment African ofblue-collar and the size of the American atriskof jobs population due to the off of white-collar African loss Americans services, shoring job cannotassumethatgood-paying jobs intheUnitedStateswillbe either readily ofemployment. Globalization's accessibleorsecureforms too paceis simply fastandtheinternational too intense for African Americans even competition mostprestigious thosegraduating from thenation's collegesanduniversities foreconomicsurvival. torelyon majorcorporations African To thrive andprosperinthefuture, Americans mustbuildon the tradition that has served as the of economicsurlynchpin entrepreneurial vivalatvariousperiodsinhistory (Bates,1997;Butler,1991;Minton,1913; thatAfrican American-owned businesses Schramm, 2004). It is imperative and in future tothrive, the because are continue prosper, grow they farmore in thesame African Americans than White-owned firms to likely employ businessniches(Boston& Ross, 1997). businesseswillfacetwomajorhurdlesor ButAfrican American-owned obstaclesin theyearsahead (The BostonConsulting Group,2005). The Because of legal challenges, to minority set-asideprograms. firstpertains tobe a viableoptionforAfrican American busisuchprograms areunlikely in thefuture(Boston,1999). The second ness growthand development movement of white-collar businessprocessesand relatesto theoffshore from offshore functions. vendors,who knowledge-intensive Competition white-collar services at arecapableofproviding highquality globallycoma to the survival and is threat major viabilityof African petitiveprices, in businesses similar niches.3 African Americans American-owned operating mustdevelopgloballycompetitive strategies, includingpossiblyforging vendors,to overcometheseand other strategicallianceswithoffshore iftheyareto remainprofitable in theforeseeable threats future. thesurvival, In additionto ensuring and expansionof existing growth, AfricanAmerican-owned "bootcamps"and businesses,entrepreneurship shouldbe offered on a routine basisthroughout businessplancompetitions to assistAfricanAmericanswho haveentrepreneurial thecountry aspiratheircreativeideas and innovations intocompetitive tionsto transform Americanbusismallbusinesses.The overarching goal is to moveAfrican ness ideas to marketmorequicklythancan be achievedvia traditional businessassistanceprograms. minority This content downloaded on Thu, 24 Jan 2013 00:42:32 AM All use subject to JSTOR Terms and Conditions 894 Journal ofBlack Studies The bootcampsshouldofferaspiringAfricanAmericanentrepreneurs intensive shortcoursesinall ofthecorefunctional areasofbusiness,as well as technicaland legal assistancein suchareasas securinga patent, tradeand commercialization. The business marking, technology plan competitions shouldprovidea nationalforumfor aspiringAfricanAmerican toreceivecriticalfeedbackontheirbusinessideasandtonetentrepreneurs workwithotherentrepreneurs, The andventure angelinvestors, capitalists. NationalBlack MBA Association,perhapsin collaborationwith the nation'stopbusinessschools,shouldchampiontheseinitiatives. African in Americans also mustpushforgreater content entrepreneurial bothK-12 andhighereducation. Giventhatrapidandunpredictable change is likelyto be theonlyconstant in thefuture, African American (andother) fromall levelsoftheU.S. education with youthwillneedtograduate system - a demonstrated acumen totakeincalcugreater entrepreneurial willingness lable risksand theabilityto be agile,flexible,tenacious,and decisivein tounanticipated andopportunities. responding challenges AfricanAmericanyouthwiththeseessentialskills,the By graduating U.S. educationsystem willgo a longwaytowardcreating thenextandsucof notonlytraditional in businessvenceedinggenerations entrepreneurs butalso social andcivicentrepreneurs who arecommitted to using turing theirentrepreneurial talentsto makemeaningful changein thenonprofit andgovernment sectors(Bornstein, 2004). Finally,the wealththatexistsin the AfricanAmericancommunity thesubstantial resourcesofthefaithcommunity) mustbe lever(including aged to createnew,and expandexisting, minority-focused pools of angel andventure new capital.Suchpools ofcapitalwillbe neededtojumpstart African American-owned and-operatedbusinessesandto groworexpand ones(Bradford & Bates,2004). existing ConcludingThoughts After the"EarlyHistory ofNegroesinBusinessinPhiladelphia" chronicling in a March 1913 addressbeforethe AmericanHistoricalSociety,Dr. HenryMintonconcludedhisformalremarks bystating"thatoursalvation as a racedependsmoreuponcommercial successthanuponanyotherone factor"(p. 20). Giventheraciallydisparateeffects ofthepowerful forces ofeconomicglobalization, ofthe we believethatDr.Minton'sassessment AfricanAmericanconditionin 1913 holds equal, if notgreater, weight today. This content downloaded on Thu, 24 Jan 2013 00:42:32 AM All use subject to JSTOR Terms and Conditions et al. /The FutureofBlackAmerica 895 Johnson successfulAfricanAmericanentrepreneurs have Throughout history, demonstrated timeand again the uncannyabilityto turnadversity into in with internal as well as external threats. opportunitydealing challenges AfricanAmericansmustrespondto thecurrent challengesof economic in much the same and most way: by developing, globalization nurturing, the full that exists in the unleashing important, entrepreneurial potential in African Americancommunity. this will Responding way paygreatdivithe dendsintheyearsahead.Foremost will be theassurance among payoffs thatfuture of African Americans are able to generations competesuccessand in for business the fully employment opportunities knowledge-based economyofthe21stcentury. Notes 1. Our estimatesof theat-riskpopulationare largerthantheBardhanand Kroll(2003) estimatesbecause we includeselectedoccupationsrepresenting higherorder,knowledgewhichtheydidnotconsideras beingvulnerable intensive to offshore functions, outsourcing. in Durham,NorthCarolina,was one ofthebestexamplesof 2. The Haytibusinessdistrict whereNorthCarolinaMutualLifeInsurance Durham'sParrishStreet, thisvibrancy. andsevfinancial servicesfirms werelocated,was popularly eralotherBlack-owned referred to as the "BlackWallStreet"in the1930s(Washington, 1981). firms 3. How vulnerable areBlack-owned tothiskindofcompetition? Ouranalysisofthe and servicefirmssuggeststhat29 ofthemprovidethetypeofwhite2005 BE 100 industrial vendors. collarservicesthatarewidelyavailablefromoffshore Whatwouldbe thedirecteffect shareto offshore iftheseBlack-owned firmslostmarket vendors?In 2005,the29 firmsthat to competition fromoffshore vendorsemployedalmost16,000workersand are vulnerable sales in excessof$4.3 billion. generated References A. (2004, March4). Educated,experienced, and outofwork(EPI S., & Stettner, Allegretto, BriefNo. 198).Availablefromwww.epl.org A. D. (2001).Programmers abroad: K., Kanakamedala, K., & Parkhe, Amoribieta, I., Bhaumik, A primer on offshore software TheMcKinsey development. Quarterly, pp. 129-139. Ante,S. E. (2004,October4). Keepingoutthewrongpeople.BusinessWeek, pp. 90-94. M. (2005,May 2). No longerthelab oftheworld.BusinessWeek, Arndt, pp. 80-81. mustgo: Businessprocessoutsourcing. Retrieved Bandham,R. (2001,October1). 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More"Can I helpyou?"jobs migrate fromU.S. to India.The Waldman, NewYorkTimes,Section1, p. 4. B. T. (1981). Durham,NorthCarolina,A cityof Negroenterprises. In L. R. Washington, Harlan& R. W. Smock(Eds.), The BookerT Washington papers (Vol. 11, pp. 56-64). Urbana:University ofIllinoisPress. This content downloaded on Thu, 24 Jan 2013 00:42:32 AM All use subject to JSTOR Terms and Conditions Johnson et al. /The FutureofBlackAmerica 899 of Management Professor JamesH. JohnsonJr.,is theWilliamRandKenanDistinguished in theKenan-Flagler BusinessSchoolat theUniversity ofNorthCarolinaat ChapelHill. His current researchactivities focuson theworkforce and workplaceimplications of post-1990 and suschangesin theUnitedStatesandon howto createhighlycompetitive demographic in thecurrent and communities era of economicuncertainty tainablebusinessenterprises and global insecurity. His recentpublicationsinclude"Racial Apartheidin a Small North RuralCommunity CarolinaTown,"in The Reviewof Black PoliticalEconomy,"Fostering in a Knowledge-Driven Economy:A NorthCarolinaCase Study,"in the Competitiveness and"9/11 andtheEconomicProspects ofMajorU.S. Cities," EconomicDevelopment Journal, in Planningand Markets. School GroverC. BurtheyIII receivedhisbachelor'sdegreeineconomicsfromtheWharton witha concentration in finance.His primary researchinterofPennsylvania, attheUniversity andemerging economics. estslie in theareasofeconomicglobalization BusinessSchool at the Kevin Ghorm is a 2nd-yearMBA studentin the Kenan-Flagler researchinterests lie in theareasof ofNorthCarolinaat ChapelHill. His primary University businessdevelopment andventure smallbusinessandminority-owned financing. This content downloaded on Thu, 24 Jan 2013 00:42:32 AM All use subject to JSTOR Terms and Conditions