DOVER – Diversity in Delaware’s vendor supplier base has a renewed focus thanks to the First State’s new administration and persistent advocates who have seen studies and pilot programs come and go in recent years with varied successes.
In one of his first meetings with the business community, Division of Small Business Director Christopher “CJ” Bell named supplier diversity as a priority, so that the state government’s purchasing power reflects the demographics. Some like Delaware Black Chamber Commerce Founder Ayanna Khan, say the shift in thinking was a needed change to ensure diverse business owners see future opportunities at the state level.
“We’ve been advocating for a long time and so far, we’ve moved the needle a little bit,” she told the Delaware Business Times.
But the state isn’t quite there yet, she added.
A disparity study released in 2022 stated what many advocates like Khan knew: non-minority and women-owned business firms were utilized significantly more than minority-owned or women-owned business counterparts.
In fact, the numbers told the tale the best – the utilization analysis showed that 91.16% of firms used were not owned by minorities or women, versus the 8.84% which were owned by one of those groups.
The disparities continued in the report which stated that “Asian American firms [accounted] for 3.54% of dollars spent and nonminority females [accounted] for 2.70 percent of dollars spent.”
“There’s this narrative that the businesses don’t exist, they’re not around, they’re not capable, all of these things. But that’s just not true,” Khan said, emphasizing that Delaware has diverse businesses capable of handling larger jobs.
“And they’re ready to work,” she said. “Sometimes we say, ‘We have this project, but we can’t find any Black and Brown contractors or firms.’ I have to ask, ‘did you even look?’ This is our mission and vision, right? To address the disparities and really advocate for improvement in those disparities.”
To help diversify the business base for its vendors, the state implemented a pilot program to hire contractors and subcontractors and local labor organizations to work on six state-funded projects. The goal with the Community Workforce Agreement pilot was to increase diversity while also unionizing larger projects. The program didn’t go as planned, according to Khan, who received a report on some of the pilot program.
The Food Bank of Delaware House was one of those projects, and it yielded 1,750 hours worked, with Black workers contributing only 417 of those hours and Hispanic workers 56 hours to the project.
A similar tale was told in the data from the Delaware Department of Natural Resources and Environmental Control’s new lab in Smyrna – a total of 1,244 hours worked were reported, with Black workers contributing 324 of those hours and Hispanic workers contributing 51 hours to the job.
La Plaza Executive Director Mary DuPont said the project ultimately had a noble goal, but it sorely missed the mark for the end goal of added diversity.
“Last year, 37% of all new businesses were Latino owned. They’re very entrepreneurial and they’re very self-sufficient and independent. They have a lot of skills and they know how to work hard. Having a business is a good way for them to really make some money and get ahead in a society that otherwise discriminates a lot against communities of color,” she said.
The pilot program, however, didn’t work to bring those community members and business owners into the loop, she added.
“Tying together unionizing the community workforce agreements with minority participation was like – one has nothing to do with the other. We have very low union participation in anything in Delaware. Delaware is not a big union state. And then the unions that we do have are predominantly white males, especially in the trades. The whole premise behind that was hard to understand, to be honest with you. I didn’t see the connection. One didn’t solve the other. They’re unrelated issues and it really showed,” DuPont said.
DuPont and Khan are both hopeful that the new administration can help move the needle more toward diversity with a bit of effort in a different direction, along with the work already being done at Delaware’s Office of Supplier Diversity.
Shavonne White, director of that office, said Bell’s comment on a renewed focus on diversity in the First State’s vendor base “made [her] day” as she has worked hard to ensure businesses of all ownership types reap the benefits of Delaware’s growing economy.
“We want to increase the spend in all of our agencies and help our businesses increase their capacity so they can do business with the state of Delaware,” White told DBT. “To give you an idea – in 2024, overall, the state of Delaware spent $15.5 billion in goods, services and products; 6% of that went to diverse small businesses. We want to make sure that our spending reflects our community because we have a diverse community here in our state.”
According to the Centers for Disease Control and Prevention, about 11% of Delaware’s population is Hispanic or Latino while about 24% is Black – that doesn’t include gender or disability-based statistics.
White pointed to the reconstruction of the Vocational Technical High School in Glasgow, another project in the pilot agreement, as a possible success story.
The goal was to increase the use of disadvantaged business enterprises with a goal of at least a 7% utilization rate. Without unions as a required factor, as well, the results were drastically different – nearly 39% of the workforce on that project came from certified minority, women or veteran-owned businesses, according to White.
“They’re getting a brand-new school. I mean, this is a $230 million renovation project,” White told DBT. “Out of that success, came House Bill 387 – so now, any state construction project over $30 million, there is a goal of spending between 10 and 30 percent with a business that is labeled a disadvantaged enterprise.”
Last June, then Governor John Carney signed that new law that sets that benchmark for state-funded public works project after it unanimously passed through the General Assembly.
Ultimately, working to diversify the vendor base would help strengthen the supply chain here in Delaware, White said.
“Diverse businesses hire diverse people. It supports not just the business community, but the community as a whole,” White told DBT.
But she added that it doesn’t stop there – supporting entrepreneurs in increasing their own business capacity will be important as the state works to improve the diversity of its vendor base. It also means that advocating for better diversity-minded practices, educating those diverse businesses will become key in the future.
“We’re really looking at that capacity piece and it’s not just get certified [as a minority, women, disability or veteran-owned business] and respond to an RFP. It takes more than that. So we want to really make sure that our businesses are ready to do business with the state,” she said.
