Minority firms face too little progress | Editorial

The latest (and aptly named) Disparity Study was recently issued by the city’s Office of Economic Opportunity. The report, which examines how much business Philadelphia does with firms owned by minorities, women, and disabled persons (M/W/DSBE), has a headline that suggests the news is better than it actually is — especially when you consider the city’s 26 percent poverty rate and the urgency that implies for the city’s economic growth.

City officials say the annual report, which has been produced since at least 2006, shows Philadelphia making “slow and steady” progress toward ensuring that these local M/W/DSBE companies collectively capture a 35 percent overall share of spending by city and quasi-public agencies. The aim is for that 35 percent goal to be achieved by the end of Fiscal Year 2020, which starts on July 1.

According to communication from the city, the report finds that city and quasi-public contracts have reached parity — one metric of equity — when it comes to minority and women-owned firms. But a closer look at the other numbers in the report suggest the reality is more mixed.

For example, the overall share of city business by these firms fell from 31.7 percent to 30.3 percent between fiscal years 2017 and 2018. That’s not much of a step forward, but Sylvie Gallier Howard, a deputy director of commerce for the city, assures us that the 1.4 percentage drop is not alarming, and that there’s no need to change course.

Also concerning is a steeper drop, from 42.8 percent to 36.6 percent, in the share of professional service contracts held by businesses owned by M/W/DSBE people. A significant number of M/W/DSBE firms in Philadelphia are in the business of providing exactly these services.

Additionally, the report reveals a worrisome gap between the goal of M/W/DSBE companies achieving a 23 percent share of public works contracts by 2020 and a utilization rate in FY 2018 of only 12 percent.

And the utilization of M/W/DSBE workers in city-related projects stood at 29.2 percent in FY 2018, according to the report. That compares to 38.6 percent in 2015.

City businessman A. Bruce Crawley, president and CEO of Millennium 3 Management, asks whether the numbers in the report provide the full picture. He also wonders why City Hall and the private sector don’t collaborate to enable Philly firms owned by minorities, women, and people with disabilities to compete for and win a larger share of contracts awarded by businesses, as well as City Hall.

These questions are worthy of answers. Perhaps the city should ask them. It’s worth remembering that white-owned firms still receive the lion’s share of public contracts in a city where non-Hispanic whites are just under a third of the population.

At the end of the day, the report for FY 2018 suggests there hasn’t been enough progress, that businesses have been waiting too long for their fair share, and ― most disheartening of all — that sluggish and arguably unsteady progress could persist if the city continues its current approach. “Slow and steady” is not a winning pace.