Policing in America: The Impact on the Entrepreneur

April 19, 2022 | By

Minnie McMillian & Phylicia Bediako

"Although policing and entrepreneurship are not often talked about together, especially for communities of color, we posit that police presence can have a reciprocal relationship with local entrepreneurs."

If entrepreneurs are the "key" to disrupting persistent generational wealth inequities, the "lock" is the communities they serve. When an entrepreneur taps into their passion, whether it's entertainment, beauty, or food, they provide resources or means that enhance the community. In Black and Brown neighborhoods, these businesses are even more significant. The most prominent example that illustrates the importance of economic vitality in a community is the Greenwood neighborhood of Tulsa, OK, one of the well-known Black Wall Streets that thrived during the height of the Jim Crow era. However, there were other neighborhoods in this era as well where Black entrepreneurs and their communities flourished. To learn more about the other Black Wall Streets, check out this article written by Forward Cities President & CEO Fay Horwitt, “Tulsa’s Greenwood neighborhood wasn’t America’s only Black Wall Street." In these communities, notably Greenwood, the Black dollar would often circulate 36 to 100 times and stay within the community for almost a year. A century later, the number has dramatically decreased as now a dollar circulates once or for only 6 hours in the Black community.

We must address the fact that, despite not being privy to a complete report of the pledges made to Black-owned businesses, communities and entrepreneurs of color are still dealing with the effects of the financial devastation of the pandemic and troubled community-police relations. In a 2021 publication, the FBI's Uniform Crime Reporting program revealed that, despite accounting for 13% of the U.S. population, Black people accounted for 33% of those arrested for non-fatal violent crimes. These disproportionate statistics contrast with those for white people, who made up 60% of the population but only 46% of arrests for non-fatal violent crimes. These statistics start to reveal how law enforcement and the criminal justice system can impact entrepreneurship in communities. Here are some of the ways these concepts interact: 

Neighborhood/Community Level:

A neighborhood is a catalyst to a thriving entrepreneurial environment. Entrepreneurs can start their journey when their community has adequate resources such as financial enterprises, physical space, and human support. An aspiring entrepreneur with a good sense of their community knows that areas populated by increased police presence alongside high mistrust of law enforcement can negatively impact patronage for their new business. 

Excessive patrolling, racial profiling, broken windows policing, and other discriminatory and racist law enforcement practices can lead to arresting community members who could have been patrons. An arrest record can create barriers to community members’ future earnings and job potential, which also decreases potential revenue for the stores they could have shopped in. Hostile local law enforcement may not feel like a resource for entrepreneurs of color who need emergency services. High/excessive police presence may make the neighborhood feel less safe for those who feel targeted by the police and seem less safe for people from outside of the neighborhood, both of which could decrease foot traffic near businesses. A negative reputation may discourage entrepreneurs from locating their business in their own or other low-income or primarily BIPOC neighborhoods, causing money to leave those communities rather than cycle repeatedly. All of these things could reduce the amount of money coming into the neighborhood from people visiting from higher-income neighborhoods while also promoting retail leakage as local residents seek products and services in other neighborhoods. Entrepreneurs who run businesses outside of their neighborhoods may pay property taxes, special business taxes, and other improvement-focused taxes and fees to other neighborhoods.

Entrepreneur Level: 

Once an entrepreneur has an established business within the neighborhood, their interaction with law enforcement can impact their financial and human resources. If a Black or Latinx-owned store is located within a community with a large population of people of color, they may be affected by the frequent arrests of their neighborhood members. The numerous arrests could impact the entrepreneur in several ways; one, is the general management and operations of the business if the arrest happens to be an employee. The arrest affects the family of the person arrested as there is now a loss of income. Now, the entrepreneur must compensate for the loss—both leading to stress. Additionally, entrepreneurs must be mindful of those employees with family or friends incarcerated from the management side, as it could impact their work performance. 

The consumer is just one of the critical resources needed for an entrepreneur to gain revenue. Therefore, frequent arrests in BIPOC communities decrease the economic stability of local businesses owned by people of color. There are numerous ways the incarceration of community members changes the economy. One, with more arrests, this could lead to fewer consumers supporting entrepreneurs and businesses. Two, imprisonment of those aspiring entrepreneurs could mean fewer people could start or operate businesses. Lastly, frequent arrests in their community could mean fewer people to employ at their business. 

Incidents of police use-of-force at a place of business can create trauma and decrease the volume of patrons entering the business. For example, Cup Foods in Minneapolis, MN, a convenience store that people in the neighborhood frequented to compensate for the food desert and the lack of adequate grocery stores, will likely remain connected to the death of George Floyd for years to come. Given the role that Cup Foods played in the highly publicized case, residents may develop a negative, triggering, or traumatic reaction to being in the store. As a result, the entrepreneur could lose revenue due to fewer people visiting the business because of the harsh reminder of someone being arrested. For other potential patrons, the entire block or area could be a trauma reminder or trigger that leads them to shop elsewhere. Unfortunately, countless other entrepreneurs and neighborhood businesses that we do not know by name could be having the same experience. 

The impact of the community-level trauma associated with fatal police encounters can affect all members of the neighborhood and city but can be especially difficult for individuals who look like the person who was killed. The trauma is experienced not just geographically, but also within communities of color across the nation who may be repeatedly exposed to new stories and videos that trigger psychological pain and fear. In recent years, the increased attention to police violence and inequities rooted in systemic racism present have been associated with persistent distress. Many people worry about themselves, their friends, and their families falling victim to a similar experience. Some days, it’s just too much to take and fake being okay, especially in a predominantly white setting. For Black and Brown entrepreneurs, this can fuel distrust in and distancing from institutions and organizations, some of which are designed to support entrepreneurs, hoping to help them in their ventures. 

Entrepreneurship serves as one potential solution to generating income for individuals, households, and communities of color in a post-pandemic era. Although policing and entrepreneurship are not often talked about together, especially for communities of color, we posit that police presence can have a reciprocal relationship with local entrepreneurs. Law enforcement can aid with dealing with unruly patrons or reporting issues about a potential robbery. Yet, experiences such as long response time, previous experience with racial discrimination, or the crime not being treated seriously can decrease trust and confidence. Strategies to address the complexity and domino effect of violence include barring the use of unlawful tactics geared towards criminalizing Black and Brown people in under-resourced neighborhoods and training law enforcement officers to create genuine relationships with the communities they serve. Law enforcement training can integrate  cultural competency and diversity perspectives and highlight an equity-centered approach to preventing and addressing community violence. Relationship-building may take the form of law enforcement agencies establishing a community liaison that specializes in creating transparent communication with the community or providing officers with protected time to get to know local entrepreneurs and small business owners in the community. Law enforcement agencies could contract with local business owners, partner with local business owners to host events, or even encourage or incentivize officers to patronize local businesses for lunch, office supplies, or other agency needs. The long-standing gap between communities of color and law enforcement has contributed to stubborn economic development inequities, but Forward Cities specializes in bridging those gaps so that all communities thrive. Connect with us for more insights on supporting entrepreneurial ecosystem building and addressing barriers for entrepreneurs who have been historically underserved or systematically excluded.


Policing in America Reports & Presentations 

Perceptions of Police Activities   Results from the Policing in America Survey by Race and Ethnicity in Cook County, Illinois and Dallas County, Texas  (June 2021) 


(Upcoming in 2022) Understanding variation in public perspectives on policing through the integration of individual-level survey data and public data sources - A report for the Policing in America Study