In recent years, when the terms “LGBTQ” and “small business” are discussed in the media, it’s usually in response to a small but vocal minority demanding religious freedom to refuse service to members of the LGBTQ community, and the legal battles that follow. However, perhaps there are more important discussions revolving around business and the LGBTQ community — the power LGBTQ-owned businesses have in furthering equality.
The National Gay and Lesbian Chamber of Commerce reported recently that LGBTQ-owned businesses contribute a whopping $1.7 trillion to the U.S. economy, and businesses certified by the NGLCC account for more than 33,000 jobs a year. Certification by the NGLCC helps ensure small business owners in the LGBTQ community can compete for contracts with the federal government in a more meaningful way, opening doors to those who would otherwise not get a seat at the table.
This is critical given that there are no laws regulating the percentage of business the federal government conducts with LGBTQ business owners, as there are with women and people of color.
The progress in LGBTQ equality in the last decade has been remarkable, and while social opinion concerning LGBTQ people is improving at greater speed than ever before, there are still hurdles we face. Forty percent of lesbian, gay and bisexual people and nearly 90 percent of transgender people still experience employment discrimination or harassment in the workplace. The implementation of discrimination protections and inclusion policies for LGBTQ employees could save the U.S. economy more than $9 billion, resulting in lower turnover rates, reduced workplace-discrimination lawsuits and higher productivity levels for employees who feel safer and more valued in their jobs. The numbers don’t lie: LGBTQ-friendly workplaces help the economy thrive.
In terms of diversity, LGBTQ-owned companies are more likely to employ people from a variety of backgrounds and socio-economic statuses, which enables those businesses to think outside the box, understand a wide range of client needs and expectations and provide innovative solutions their competition may not even think of. In a study conducted by Harvard Business Review of 1,800 professionals, 40 case studies and numerous surveys and interviews, they learned that companies with diverse employees are 45-percent more likely to report growth over the prior year’s market share, and are 70-percent more likely to have captured a new market demographic for their products or services. The reason for this is that diverse employees are more likely to have a larger set of experiences on which to rely for creativity and problem-solving, and they’re also more open to trying new solutions to fulfill client needs. As a result, diverse businesses out-perform their competitors consistently, which translates to economic growth.
There’ve been a lot of questions since the SCOTUS marriage ruling in 2015 about where LGBTQ advocates go next in the equality conversation. Many looked to workplace and housing discrimination as the next step, but perhaps we’re overlooking economic and political empowerment through business as a key factor in the fight for equality. It’s not just about how LGBTQ people are treated in the workplace. Fostering a good workplace for others through business ownership gives people who’ve been discriminated against a safe, nurturing environment in which to thrive, earn an income and create personal stability. Currently, gay men earn less than straight men, but that is less likely to happen in an LGBTQ-owned business.
Younger generations are beginning to overtake older ones in the workforce, and with the increase in their earnings potential, young workers are looking for investing opportunities that not only promise financial gain, but social and environmental as well. LGBTQ-owned companies are more attuned to social progress and equal treatment, and it’s more than PR spin. LGBTQ business owners have lived with inequality, not knowing if and when they should come out to their employees and financial backers. Staying in the closet because it could affect business is never ideal, and out business owners have, in the past, faced the loss of essential funding for their ventures because investors have seen them as more of a risk. The more out business owners there are, the more such things become part of society’s norm, and in an ideal business world, their orientation wouldn’t matter in terms of risk or potential return on investment.
There’s also a surprising misconception that LGBTQ business owners are wealthy, which isn’t always the case. The NGLCC certification helps, empowering those business owners to compete for government contracts, thereby increasing potential earnings which benefit the economy as a whole. But not all LGBTQ business owners have seed money to begin new ventures, particularly if they’ve lost a job due to their orientation (such discrimination is still legal in more than half the states in the U.S.) or have strained familial ties where they weren’t given opportunities for higher education because they were ostracized by their parents. Owning a business seems out of reach for many LGBTQ people who’ve not had the privileges their straight counterparts have enjoyed, so to work for an LGBTQ-owned business can be an empowerment all on its own.
Visibility and diversity are not just talking points for LGBTQ entrepreneurs. They’ve lived it, and they know how important it is to provide equal opportunities for their employees. They’ve often had to be creative for the same chances their straight counterparts have, and because of this, they’re more innovative, more adaptable to changing times and social climes and, overall, more inclusive toward a variety of customers and employees. Small businesses are the lifeblood of the U.S. economy, and with more progress needed in the LGBTQ civil-rights movement, LGBTQ entrepreneurs are poised to bring even more equality to our ever-changing political, economic and social landscape.