News Briefs
Ad Woes
New York City’s Commission on Human Rights found that only 2.5 percent of top earners in the advertising industry were Black. The commission examined 8,000 employees working for 16 agencies and found that about 22 percent make more than $100,000 a year and only 2.5 percent of those are Black. Although the major ad firms have Black workers, they are largely absent from the most senior or creative levels. The ad firms will be monitored by the city and will set up diversity boards and establish recruiting and internship programs through universities with large minority student populations.
Urban Schools
Lawmakers in New Jersey plan to develop a school funding formula that ends special treatment for poor, urban schools. The plan would end disputes over state funding disparities between suburban, rural and city schools, but would have to pass muster with a state Supreme Court ruling that has demanded equality between poor and wealthy schools. State Sen. John Adler and Assemblyman Herb Conaway, co-chairmen of a special committee mulling over school funding as part of property tax reform talks, said their goal is to develop a formula that can be imposed on every school district, no matter its location.
TV/Film Studio & Distribution Center
Sapphire Entertainment Inc. was launched in Chicago as the first African-American-owned television and film studio and distribution center. CEO and founder Andrea Allen says the center will produce, market and distribute action, comedy, drama, thriller and suspense movies for all audiences. Sapphire, which received much of its funding from a private investor, plans to employ 300 workers in its distribution and sales centers in Chicago and Los Angeles, in its corporate offices and in studios on the Gold Coast area of Chicago and in New York within the next three years.
Buying Power
Hispanics will outpace Blacks as the most powerful minority consumers in the country next year, but the vast majority of U.S. states will continue to see Blacks as their strongest minority market because the nation’s Hispanic population is concentrated in a handful of areas, the University of Georgia’s Selig Center for Economic Growth says. Hispanics are expected to have buying power of $863.1 billion, compared to Black buying power of $847 billion in 2007. Hispanics, the largest and fastest growing ethnic minority, will comprise about 8.5 percent of the nation’s consumer market next year.
Digital Divide
Two out of every three white students use the Internet, but fewer than half of Blacks and Hispanics do, according to data from the National Center for Education Statistics, an arm of the U.S. Department of Education. The specific numbers are 67 percent for whites, 44 percent for Hispanics and 47 percent for Blacks. Experts say this creates barriers for minorities in a world in which they're going to be expected to know how to do these things. Overall, 91 percent of students in nursery school through 12th grade use computers; 59 percent use the Internet.
Customizing Wal-Mart
Wal-Mart Stores Inc. is retooling its 3,256 U.S. stores over the next two years to give them a more customized mix of goods and layout for key groups of customers, including Hispanics, African-Americans and affluent shoppers. The move, called segmentation, is the latest strategy twist for the world’s largest retailer as it struggles to revive growth rates that have fallen behind smaller rivals such as Target Corp. and after the company’s first quarterly drop in profits in a decade. Other target groups identified by Wal-Mart’s market researchers are “empty nesters/boomers,” suburban and rural shoppers.
Home Inequity
The Federal Reserve’s analysis of 2005 home lending data found that 54.7 percent of Black borrowers paid a higher than typical interest rate on home mortgages. That was up sharply from 32.4 percent in 2004. For Hispanics, 46.1 percent paid more than is typical for their mortgages last year, more than double the 20.3 percent reported in 2004. In contrast, only 17.2 percent of whites paid higher interest on their home mortgages last year. However, that was up considerably from 2004’s 8.7 percent. The report also said that Black borrowers applying for mortgages were more likely to be turned down than Hispanics and whites.
Unstable Middle Class
Higher borrowing rates and a shortage of assets to be passed from previous generations continue to create instability in the Black middle class (those earning between $60,000 and $200,000 a year), a problem that is often overshadowed by severe urban poverty but that Congress should not ignore, speakers at a Congressional Black Caucus legislative conference said. They said many middle income Blacks struggle financially because they own few assets such as real estate or stocks and frequently pay more for home mortgages, auto loans and other big-ticket items.
Harvard’s No-Contribution Rule
Harvard University said the families of undergraduate students with low incomes would no longer have to contribute to the cost of their child’s education. In 2004 the rule applied to families earning less than $40,000 a year with an honor student graduating from high school soon. Harvard’s president, Lawrence H. Summers, said that when only 10 percent of the students in elite higher education come from families in the lower half of income distribution, “We are not doing enough.” On March 30, 2006, Harvard announced that families with incomes of less than $60,000 would not have to contribute. For more information, visit Harvard’s financial aid Web site, http://fao.fas.harvard.edu/, or call the school’s financial aid office: 617-495-1581.
Education Report Card
The United States has fallen behind other nations in educating its young adults and workers and college affordability continues to deteriorate for most American students and their families, according to the study “Measuring Up 2006: The National Report Card on Higher Education” from the National Center for Public Policy and Higher Education. The diverse young population that will replace the country’s well-educated baby boomer generation does not appear prepared educationally to maintain the United State’s edge in the global economy. The United States is still a world leader in the proportion of Americans ages 35 to 64 with a college degree, but ranks seventh on this measure for 25- to 34-year-olds. In college completion rates, the United States ranks in the bottom half.
Mutual Fund Giveback
The Securities and Exchange Commission said five mutual fund managers would return a total of $7 million plus interest to investors who were overcharged for performance-based fees between April 1997 and December 2004. The commission censured and presented cease-and-desist orders to mutual funds operated by the Dreyfus Corp., Gartmore Mutual Fund Capital Trust, Kensington Investment Group Inc., Numeric Investors L.L.C. and Putnam Investment Management L.L.C.. There is no fine in the settlement.
Positive Colonization?
The Representative Council of Black Associations, an umbrella group for France’s Black community, called for the iconic Petit Robert dictionary to be pulled off the shelves, arguing that the dictionary’s definition of colonization as getting the “best returns out of a country” perpetuates the notion that colonialism is a positive endeavor. Colonization has been a hot subject in France since parliament passed a law last year requiring schoolbooks to highlight the “positive role” of French colonialism. After a wave of protests, the term was stripped from the legislation.
Weight-Loss Market
The global obesity treatment market is expected to advance to upwards of $9 billion by 2010, with surgical interventions expected to account for 82.5 percent of the market, up from 68.9 percent in 2005, according to “Obesity: The Worldwide Market for Pharmaceutical and Surgical Treatment,” a study from Kalorama Information. Prescription and over-the-counter anti-obesity and weight-loss pharmaceuticals will fare poorly primarily due to competition from the surgical segment, the failure of breakthrough anti-obesity drugs and the inability of current drugs to produce major weight loss for most patients.
