In the ever-changing Nevada business scene, companies are finally acknowledging shifting demographics and the vital role of ethnic diversity in their business strategies. “Corporations have realized minority business is important to the fabric of our state,” said Dianne Fontes, president of the Nevada Minority Business Council, which helps mentor minority business people and connects minority businesses with purchasing agents at large corporations. “It’s good business to utilize minorities because they are also customers,” she pointed out.
Diversity initiatives have two principal goals: to increase the percentage of racial and ethnic minorities in employment, especially in management areas; and to make sure minority contractors and suppliers receive a share of contracts for goods and services.
Awareness of diversity programs is barely keeping up with the realities of the work force. Nearly a third of the state’s secondary-school students are Hispanic, which will create a huge impact on the available work force. Will Nevada be prepared for the next wave of talented and diverse employees and minority-owned businesses?
The kinds of businesses owned by minorities are as varied as the ethnicities represented in Nevada. Trends lean toward restaurants in the Hispanic communities, according to Eloiza Martinez, president of the Latin Chamber of Commerce, who said, “A lot of people miss their traditional food, so providing a place to get it will usually pay off.” According to Robert Yu, president of the Asian Chamber of Commerce, Asian-owned businesses range from restaurants to professional services such as Realtors and attorneys. Yu said a growing sector is medical offices around the Las Vegas Valley.
“Today, minority businesses are more savvy,” said Fontes. “The work ethic and professionalism are greater than ever before.” Martinez added, “There’s room for everyone. Housing is still good, the tax structure is favorable, and Nevada provides a good business environment.”
Businesses Reflect Changing Demographics
The nation’s Hispanic population reached 41.3 million as of July 1, 2004, according to national estimates by the U.S. Census Bureau. Hispanics, who may be of any race, accounted for about one half of the national population growth of 2.9 million between July 1, 2003 and July 1, 2004. The Hispanic growth rate of 3.6 percent over the 12-month period was more than three times that of the total population (1.0 percent).
The U.S. Census Bureau statistics for 2000 show a Nevada work force of 995,195. The ethnic breakdown is: 69 percent Caucasian; 16.4 percent Hispanic; 5.9 percent African American; 4.7 percent Asian and 1.1 percent American Indian. Of the management and financial workers (9.6 percent of the total workforce), 81 percent are Caucasian, with less than 10 percent in each of the other ethnic categories. However, in the service industry, representing 20.7 percent of the work force, 11.2 percent are Caucasian, 5.3 percent Hispanic, 1.6 percent African American, 1.7 percent Asian, and 0.2 percent American Indian.
Corporate Commitment to Diversity Grows
One indicator of progress in increasing minority representation in the business environment is the number of public and private sector entities adopting diversity initiatives. Fontes said Nevada companies are doing a fairly good job overall. “Some are better than others,” she said. “We support any company providing a program with the intention of increasing opportunity for minority business enterprises, not just in concept, but with training and information.”
“The most important thing is commitment and attitude,” said Horacio Lopez, a long-time advocate of minority business. He owns the Southern Nevada Courier Service and is chair of the Resource Committee of the Regional Business Development Advisory Council. “Private industry has set the model for minority enterprise. There, policy is being handled from the top down, instead of bottom up, as it is in government. When the CEO says, ‘I want this to happen,’ it does.”
The barometer for diversity management in Las Vegas is MGM Mirage, which launched an overall diversity initiative four years ago. In 2003, MGM Mirage adopted a formal policy requiring minority bid participation in all contracts and purchases exceeding $1,000. Minority firms seeking contracts are required to be certified by a partner organization, such as the National Minority Supplier Development Council. Tracking mechanisms allow the company to monitor progress, and the corporation openly discloses and reports its diversity spending. For example, the company spent $847.8 million in biddable goods, services and commodities in 2004. Of this amount, $77.4 million was spent with minority-, women- and disadvantaged-owned business enterprises (MWDBEs), up from $24.3 million in 2001. The number of registered MWDBEs in the MGM Mirage Supplier Diversity Program continues to expand, and the amount of money spent increased by 218 percent between 2001 and 2004.
Diversity initiatives in hiring are not just good business, but essential for the future survival of major corporations. “The labor market is shrinking as baby boomers begin to retire,” said Punam Mather, senior vice president of corporate diversity and community affairs at MGM Mirage. “These initiatives make us competitive for attracting and, more importantly, retaining productive employees.
“We believe in creating a culture that truly values and recognizes the contributions made by everyone,” Mather continued. “That makes us more attractive as an employer and gives us a tangible return on the largest investment we make [in our employees].”
Strategic student recruitment is the key to consistent employee minority hiring practices, according to the MGM Mirage 2004 Diversity Report. The company established an innovative five-year partnership with the College of Hotel Administration at UNLV to promote minority student enrollment and graduation to enhance the pool of qualified candidates for employment in the gaming industry.
With a $500,000 commitment, eligible students may seek educational support from the MGM Mirage Scholarship Fund. Fourteen students were named MGM Mirage scholars in 2004. The company has worked on a national scale to strengthen its relationships with educational institutions throughout the U.S. In fact, MGM Mirage maintains a full-time college recruitment manager whose primary mission is to develop strategies to help position the company as an “employer of choice” by attracting and recruiting college minority graduates.
Harrah’s Entertainment owns 13 casinos in Northern and Southern Nevada – six of them on the Strip, including Caesars Palace, Ballys, Paris, Flamingo, the Rio and Harrah’s, as well as the Reno Hilton, Harvey’s in Tahoe and others. Now in the initial stages of developing its corporate diversity program, Harrah’s has made it a top priority and assigned responsibility at the highest management level. Vice President Fred Keeton is Harrah’s chief diversity officer.
Harrah’s spokesman David Strow said Harrah’s diversity program will be all-encompassing, including employment and vendor purchasing. “We want to do more than just talk – we want a complete plan that involves every segment of the company. To do that, we must plan and take the time to do it right.”
Prior to its recent merger with Caesars, 47 percent of Harrah’s 46,500-person work force was made up of minorities. “Harrah’s management intends to improve diversity figures at all levels of the organization, from the front line to management,” said Strow. The concept Harrah’s is developing goes beyond the traditional definition of diversity, which is usually based on ethnicity and gender. “That’s important to us,” Strow said, “but we also believe you should go beyond that and think about wider inclusions, such as an individual’s background, national origin, sexual orientation and so on.”
Harrah’s expects to implement its diversity program by the end of this year and begin in earnest in 2006. “We also plan to communicate with our employees and explain why it makes us a stronger company,” Strow said.
Some companies don’t find it necessary to have a formal minority hiring policy or diversity program. “As of the first of this year, our total work force was 2,750 people,” said Jenny DesVaux Oakes, assistant vice president of Sierra Health. “Of that, we have nearly 1,000 minority employees. We just look for the best person for the job, and with the fast-growing minority population, it just takes care of itself.”
A major trend is the bundling and partnering of businesses for smaller companies. “This gives an opportunity for success,” said Fontes. For example, when Thor Construction entered the Nevada market, it was bidding for projects without success. MGM Mirage paired Thor with Perini Building Company in a joint-venture partnership between a minority- and majority-owned general contractor. Thor worked on 12 separate projects, providing services that totaled more than $20 million in 2004.
Construction Plays a Major Role
Minority workers are heavily employed in the construction industry, which plays such a major role in shaping the image of the metropolitan areas of Reno, Carson City, North Las Vegas, Henderson and Las Vegas. However, a growing number of business owners, licensed contractors and subcontractors also are minorities. The National Association of Minority Contractors (NAMC), Nevada Chapter, is recognized as the preeminent construction organization representing minority contractors and minority- and woman-owned construction-related businesses.
“We like to say we are bridging ethnic barriers,” said Al Barber, NAMC national president and owner of TBL Construction in Las Vegas. “NAMC’s role is to provide opportunities for minority- and female-owned businesses. We advocate for issues that concern minority contractors and promote the economic and legal interests of minority-owned firms. Our goal is to remove barriers to full equality and provide a connection between NAMC members and the people with whom they work.”
He added, “From a construction standpoint, minority businesses in general have proved successful in smaller projects and are more than capable of handling larger contracts. The trend I see is more minority-owned businesses getting larger contracts.”
Barber said NAMC endorses the highest professional standards in the construction industry and backs it up by providing support through a youth training program. Designed to provide young adults ages 16 to 21 an opportunity to learn the construction trade first-hand from experts, the Construction Youth Program teaches young men and women, many of whom are from disadvantaged circumstances, the crafts and skills needed to succeed in a construction career, as well as providing on-the-job training and even placing those who complete the course in meaningful jobs.
Chambers Get Involved
“There is a definite trend of more women entrepreneurs starting businesses,” said Eduardo Wagner, president of the Hispanic Chamber, which is based in Northern Nevada. “The majority of new minority-owned businesses in the past three years are owned by women.”
One of the major problems, at least in Northern Nevada, according to Wagner, is a lack of cultural understanding by non-Hispanics. “Corporate America sees all Spanish-speaking people as one,” he said. “They truly don’t know us.” Wagner said businesses, regardless of size, sometimes make wrong assumptions about the Hispanic community, such as all Spanish-speaking people being Catholic or being Mexican. “Corporations tend to lump all Spanish-speaking cultures together. They need to know the difference between the 22 different Spanish-language countries to market properly.”
While job opportunities in the Hispanic community have been “overlooked and neglected,” Wagner admits corporations are now reaching out. “Understanding is the most important thing,” he said. “Our chamber is offering guidance toward that understanding.”
“Business within the Latin community is growing, although not at the speed we want it to,” said Martinez of the Latin Chamber, which is based in Southern Nevada. The chamber has matured to an influential organization of more than 1,300 members. One of its primary goals is education. “There are many small business owners who want growth and expansion for their businesses, but they need extra training,” Martinez said.
The Latin Chamber offers assistance to members through free workshops, seminars and one-on-one help from other members. “For first-time business owners, or maybe a mom-and-pop shop wanting to expand, we provide resources in areas they need, such as banking or accounting,” said Martinez.
She emphasized the Latin Chamber’s partnership with the Small Business Administration and the Nevada Minority Business Council. It also participates in three-way “unity” meetings with the Urban and Asian chambers. Another effective networking opportunity is the “breakfast with friends,” or Desayuno con Amigos. “Once a month we have a breakfast meeting opened up to the community,” Martinez said. “It’s all in Spanish for entrepreneurs in need of a networking opportunity.” Martinez’s advice for emerging minority-owned business owners is to educate themselves. “Education is the way to prosperity in your business.”
More representation of Latin interests is needed in the political arena, Martinez asserted. “I believe there is room for a Latina or Latino political figure to assist with growth issues,” she said.
The number of Asians moving from Southern California and other parts of the country has increased dramatically. “A prime example is the business development on Spring Mountain Road [in Las Vegas], said Yu of the Asian Chamber. He estimated the Asian population in Nevada has more than doubled in last five years.
“We are very optimistic,” Yu said. “Not just for minorities, but growth applies to everybody. Our state has one of the best business environments in the country – that is the main thing. Success creates jobs and brings people.”
“The sheer growth in population should fuel a corresponding growth in
business opportunities,” said Urban Chamber of Commerce Executive Director Louis Overstreet. He points to “slow, yet steady growth” in the past five years, fostered in part by a positive working relationship with the business community established by Urban Chamber President Hannah Brown, as well as the leaders of other chambers.
“Growth is a function of two things,” Overstreet said. “Namely, the gaming industry’s commitment to diversity, as spearheaded by the leadership of Terry Lanni of the MGM Mirage and demonstrated commitments exhibited by companies such as Station Casinos, the old Caesars Entertainment and Mandalay Resort group, Boyd Gaming and Harrah’s Entertainment; as well as the rapid increase in persons of color moving to Clark County.”
As for the types of businesses Overstreet sees in the minority communities, “There are three major areas of growth for minority businesses: firms providing goods and services to the hospitality industry; companies providing construction services; and individuals providing professional services, such as doctors, lawyers and dentists.”
Overstreet, however, is concerned that some Clark County government agencies have not increased the percentage of minority participation. The Regional Business Development Advisory Council’s Resource Committee Report dated June 8, 2005, stated: “2004 statistics indicate that the hoped-for improvements in the percentages of persons of color and women-owned businesses providing goods and services on [county] publicly funded projects have not materialized over the past decade.” Of the $1.7 billion spent by government agencies in Southern Nevada in 2004, $63.8 million (less than 4 percent) was paid to minority, disadvantaged or woman-owned businesses.
Perhaps the most challenged segment of the minority business community is the Native American community. “We are the least served of all Nevada populations,” said Debra Sillik, president of the American Indian Chamber of Commerce of Nevada, based in Las Vegas. “Native Americans are coming from all over the U.S. to Nevada for job opportunities,” she said. “But once they leave the reservations, access to services is more difficult than they are used to. Housing in particular is a serious issue. Many people end up in weekly rentals, or with extended families taking care of each other.”
The 2000 U.S. Census Bureau listed 10,615 Native Americans in Nevada, or 1.1 percent of the Nevada work force. Sillik estimates about 30,000 Native Americans currently live in Southern Nevada. The chamber is experiencing a resurgence, and is starting monthly luncheons beginning in August. “We hope to draw more corporations into the chamber,” Sillik said. “Members need resources and connections to excel. We are all about making it easier for our people to find jobs and start businesses.”
The face of Nevada continues to change. Minority businesses and the overall corporate sector are responding by adjusting their respective hiring practices, improving contract and supplier diversity strategies and taking the needed steps to create a vibrant and prosperous future business climate.