Tawanna Black, founder and CEO of the Center for Economic Inclusion Photo by Brandon Werth

This week, the St. Paul-based Center for Economic Inclusion released a report that “offers a baseline” for public entities to track their progress on racial equity.

The public sector Racial Equity Dividends Index collected data from 22 participating cities, counties, and government entities in Minnesota.

In its introduction, the report notes that in addition to employing thousands of people in the state, public offices also play key roles in setting policies related to economic and workforce development, housing, transportation, and public safety. These offices work and contract with local businesses while providing essential services to residents.

The public sector needs to work in tandem with the private sector in order to support the communities governments represent, center founder and CEO Tawanna Black told TCB. Data is pivotal to identifying areas in need of improvement, which is why everything the Center for Economic Inclusion does is done through a data-driven lens, she said.

Earlier this year, the center also released a 2023 Private Sector Racial Equity Dividends Index. When comparing the public sector to private sector findings, two pieces of the research stood out to Black.

The first was in findings around public entities’ procurement of suppliers and contractors. In the report, high-achieving survey participants in each category would be highlighted, but in procurement “we struggled to have any entities that we could recognize.”

The challenge is that many governments are not meaningfully measuring progress in diversifying this aspect of operation, Black said “Supplier diversity is what drives job growth,” Black said. “It’s what drives economic growth. If you’re spending with those businesses that are the fastest growing in the country, they add more employees which only improves your community.”

Secondly, Black noted public entities need to further center the voices of people of color in lobbying and advocacy work with federal policymakers.

“Are they aligning their racial equity strategies and their bonding bills, for instance, or their capital development bills?” she said.

In addition to data, the report highlights promising practices and case studies from Minnesota and across the country. The full report can be read here. 

The participating entities answered questions analyzing 11 key areas of economic development. Here are key insights from the report:

Leadership

• 20% of executive leaders, 15% of supervisors, and 25% of full-time staff at participating local governments identify as Black, Indigenous, Hispanic, Asian, or two or more races.
• No participating local governments have senior leadership teams that reflect the racial demographics of their communities.

Hiring

• 35% of new hires across participating local governments identify as Black, Indigenous, Hispanic, Asian, or two or more races.
• 95% of local governments publish salary information for all job postings.
• 55% of local governments set enterprise-wide goals for hiring a racially diverse workforce.

Culture, Retention, Advancement

• Approximately 90% of all full-time Black, Indigenous, Hispanic, and Asian employees at participating local governments earn family-sustaining wages.
• 41% of local governments have clear standards for promotions that are shared with all employees.

Procurement

• 36% of local governments have taken comprehensive actions to reduce barriers for suppliers.
• 9% of local governments regularly collect and share data internally on the racial diversity of their suppliers.

Budgets & Finance

• 25% of local governments invest assets in community development financial institution funds.
• 14% of local governments proactively seek input from Black, Indigenous, Hispanic/Latine, and Asian communities in the early stages of developing budgets.

Community and Economic Development

• 44% of local governments have initiatives to support entrepreneurship targeted towards Black, Indigenous, Hispanic/Latine, Asian, and other underrepresented communities.
• 24% of local governments only offer economic development job creation subsidies to companies that pay family-sustaining wages.

Workforce Development

• 15% of local governments survey workforce development program participants about their job placement experiences, disaggregate data by race, and use information to guide future job placements.

Housing, Transportation, and Land Use

• 89% of local governments’ zoning codes allow higher-density construction near commercial corridors and job centers.
• 47% of local governments offer financial programs for first-time homebuyers and analyze program participation by race.

Public Safety

• 82% of local governments invest in alternative crisis response teams.
• 14% of local governments publish comprehensive data on law enforcement activities disaggregated by race.

Human Services

• 25% of participating counties collect data on the race and ethnicity of program participants, identify underserved but eligible populations, and take action to increase participation.

Public Policy

• 68% of local governments have identified racial equity as a public policy priority.
• 38% of local governments have strategies to seek input from Black, Indigenous, Hispanic/Latine, and Asian communities about local ordinance development.