94% of federal contract payments and 89% of federal contracts go to white owned businesses 

New York, NY. — April 2, 2025 — A new report from the Global Black Economic Forum (GBEF) sets the record straight: Far from benefiting from “special treatment,” minority-owned businesses are being systematically shut out of federal contracting opportunities. Despite making up a vital part of the business community, minority-owned firms receive less than 10% of federal contract dollars. This stark disparity comes as misinformation campaigns falsely claim that taxpayer dollars are being funneled disproportionately to diverse businesses.

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In reality, minority-owned businesses are underfunded and underutilized. With the federal administration’s March 14 executive order gutting the Minority Business Development Agency (MBDA), the gap is poised to grow even wider. Each year, the federal government spends more than $1 trillion on contracts, making it the largest consumer in the world—and one of the most powerful drivers of economic growth. Yet, instead of leveraging that spending to promote prosperity, innovation, and inclusion, political rollbacks and restrictive policies are locking out diverse entrepreneurs.

“Fair access to federal contracts is not only an issue of justice – it’s about economic growth and mobility,” said Alphonso David, President and CEO of the Global Black Economic Forum. “If policymakers are serious about ensuring the U.S. economy remains the global engine of prosperity, they must reform the federal contracting system to ensure minority-owned businesses can fairly compete. At a time when people are concerned about the economy, this report makes clear that diverse businesses can help expand the economic pie for all people in America.”

The report further found that: 

• Minority-owned businesses make up 22.6% of employer firms, yet they receive far less than their proportional share of federal contracts, highlighting a major economic disparity. 
• 54% of set-aside program contracts go to white owned businesses,  disproving the myth that minority-owned businesses overwhelmingly benefit from receiving special advantages.
• The rollback of the Minority Business Development Agency (MBDA) and other federal programs threatens to widen existing disparities, making it even harder for minority-owned businesses to compete and grow in the federal contracting landscape.
• Federal contracts represent approximately 11% of total federal spending ($773.68 billion in FY 2024), yet minority-owned businesses receive only a fraction of these funds.
• Investing in minority-owned businesses could significantly boost the economy, as these firms generate $363.6 billion annually, sustain over 1 million jobs, and contribute more than half a trillion dollars in total economic impact.

The full report is available for download at gbef.com/foundation