Latino entrepreneurship on the rise in Pennsylvania, for many reasons
HARRISBURG, Pa. — When Elizabeth Peralta’s husband suffered a stroke at the height of the COVID-19 pandemic, she had no option but to leave her job.
She had to be on call to help him and take him to medical appointments. Her job at a warehouse gave her no flexibility to do that.
As her husband got better, Peralta started picking up some independent work cleaning houses and offices. She still was not ready to go back to the labor market as a wage employee.
“That’s when the light bulb went off and I said ‘I can do this,’” Peralta said.
She set out to create her own cleaning business – J&E Cleaning services – which she launched in March. She now works for hospitals, restaurants and daycares, and hopes to expand, and hire more people.
“I felt motivated, despite the current economic conditions and the situation for migrants, because it’s really a personal motivation I have,” Peralta said. “I needed to take on an enterprise that could move me forward, that could give me that feeling that I’m doing something for myself, not just working for a company –something to build my independence.” She also wanted to leave a legacy for her children.
Peralta is one of many Latinos who have started their own businesses in recent years. The U.S. Treasury Department reports the number of self-employed Latino workers has increased 26% between 2019 to 2023.
Pennsylvania saw a nearly 50% increase in Hispanic-owned businesses between 2012 and 2019, according to Census data. Non-Hispanic businesses increased by 9.3%, which means Latinos are creating businesses at a higher rate than their non-Hispanic peers.
Data from the Small Business Administration also shows an increase in lending to Latino-owned businesses. SBA is an independent federal agency that administers lending programs for small business owners. In Pennsylvania, SBA loans to Latino-owned businesses doubled between 2020 and 2023, from $19 million to nearly $40 million.
According to SBA, this increase in lending is happening amid a tightening credit environment and has also been part of an intentional approach to provide more support to small business owners in underserved communities.
“We have just seen in the last, probably 10 to 15 years, an effort to reach out to really all underserved communities, especially Hispanic owned, because we realize that they’re part of the huge part of the economy,” said John Fleming, regional administrator at SBA.
Some business owners, such as Jenny Urbano, started a business from scratch, without much access to capital to start with. Urbano said that when she started her business in March, she was unemployed and not in the best position to create a hair salon. She only had enough money for a security deposit, and not enough saved for the first two months of rent.
Now, Urbano is running Jenn Beauty Salon in Harrisburg by herself, but hopes to expand her clientele and hire more employees.
“I also say that when you do things with love, all you need is one client, because that person will bring you new clients, and that’s how I have grown so far,” Urbano said.
When Urbano moved to Harrisburg almost three years ago from New York City, where she owned a hair salon, she worked some side jobs to get by, including packaging cheese at a factory. But cosmetology remained her passion.
“I realized that what I earned in a week there, I could earn in two days doing what I do,” Urbano said.
A passion for a craft and a desire for independence from the wage labor market are some of the reasons that drive Latino entrepreneurship.
Esmirna Jiménez, an accountant and financial advisor based in central Pennsylvania, said she is noticing a boom in clients seeking advice on looking to start businesses, particularly clients who are undocumented who are finding it difficult to find jobs at warehouses and other places where employers are checking people’s work eligibility in the U.S. through E-verify.
Jiménez helps her clients apply for an Individual Taxpayer Identification Number, which allows them to provide services and pay taxes as an independent contractor.
“Small businesses boost local economies,” Jiménez said. “Those business owners will go on to pay federal and local taxes. They buy and sell, and pay for insurance. They pay employees too, so that diversifies low-resource, minority economies.”