Many ex-offenders become entrepreneurs or become involved in informal work activities to avoid exclusionary hiring practices in the formal economy. “Ex-offenders re-entering communities face a host of problems, a major one being barriers to employment because of their criminal records,” according to Carmen Solomon-Fears, specialist in social policy at the Congressional Research Service.” Most employers now conduct background checks, with the result that people are often denied employment or even fired from jobs because of their criminal records,” she added.
With few mechanisms in place to support the inclusion of ex-offenders in the formal economy, many turn to informal participation and/or entrepreneurship. In this vein, Sterling sold CDs to support five children. Garner sold single cigarettes, oftentimes referred to as ‘loosies’ to support six.
These are examples of the types of informal entrepreneurial endeavors that unemployed ex-offenders rely on to make ends meet. “Many people who are officially jobless are nonetheless involved in informal kinds of work activity, ranging from unpaid housework to work in the informal or illegal economies that draw income,” according to William Julius Wilson, professor of social policy and director of the Joblessness and Urban Poverty Research Program at Harvard University.
These informal kinds of work carry added importance for black Americans, a demographic that is incarcerated at five times the rate of white Americans and earns on average 64-72 cent to every dollar earned by white men.
“It’s no wonder black people start businesses at five times the rate of any other race. We are fed up with paying a societal debt, when we know it was black hands that invested in the wealth building of this country absent financial return. Our labor should have yielded a black American surplus, not at a deficit we are paying to this day,” according to Kezia Williams, founding director of Black upStart.
“Folk tryna talk to me about Alton Sterling’s criminal record. Ok. But facts are, both Alton Sterling and Eric Garner were attempting an entrepreneurial endeavor to make ends meet after their sentences were served. Any black person with a degree, ambition and a wit of common sense knows landing a job at the corporate plantation is difficult unless you work two times as hard, are two times as smart, and willing to accept appetizer-like money knowing your credentials and work ethic are main course money worthy. Now imagine going through this same exercise with a criminal record,” she concluded.
These “informal activities,” such as selling loose cigarettes or CDs, are often criminalized by the state, perhaps because they are either partially or fully outside government regulation, taxation, and observation.
Therefore, many of the entrepreneurial endeavors of ex-offenders are illegal, unprofitable and/or unsuccessful because ex-offenders, specifically ex-offenders of color, continue to be criminalized and severely under-capitalized with little to no formal structures to acquire the funding and social capital necessary to scale a successful startup, according to Digital undivided, a California-based investment firm.
Defy Ventures, an online entrepreneurship training platform for people with criminal histories, is trying to change that. “Defy recognizes that many former drug dealers and gang leaders can become successful, legal entrepreneurs,” according to the website. We transform the hustle of our formerly incarcerated Entrepreneurs-in-Training (EITs) by offering intensive leadership development, Shark Tank– style business plan competitions, executive mentoring, financial investment, and startup incubation.”
So far, the results from the online platform are strong: of the 800 prisoners who went through Defy’s first prisoner entrepreneurship program in Texas, recidivism is just 5% and about 80 businesses have launched.
Entrepreneurship, broadly, and Defy, specifically, is not a solution to all of the problems plaguing our community. It cannot prevent a callous white police officer from murdering an entrepreneurial father of six. It cannot prevent local or state legislatures from enacting policies that disenfranchise millions of black Americans. It cannot eradicate educational inequality. But it is a seed of hope.
If properly watered, the seed can become a tree of life that nurtures an independent black economy and a strong institutional resource base that is necessary for black survival in the 21st century.
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