A study of the manpower implications of small business financing
by Joseph Debro
A 1968 book-length report, titled “A Study of the Manpower Implications of Small Business Financing: A Survey of 149 Minority and 202 Anglo-Owned Small Businesses in Oakland, California,” was sent to the Bay View by its author, Joseph Debro, prior to his death in November 2013, and his family has kindly permitted the Bay View to publish it. The survey it’s based on was conducted by the Oakland Small Business Development Center, which Debro headed, “in cooperation with the small businessmen of Oakland, supported in part by a grant, No. 91-05-67-29, from the U.S. Department of Labor, Manpower Administration, Office of Manpower, Policy, Evaluation and Research.” Project co-directors were Jack Brown and Joseph Debro, and survey coordinator was Agustin Jimenez. The Bay View is publishing the report as a series. A prolog appeared in the December 2013 Bay View, Part 1 in January 2014, Part 2 in February, Part 3 in April, Part 4 in May, Part 5 in June, Part 6 in August, Part 7 in October, Part 8 in November, Part 9 in January 2015, Part 10 in March, Part 11 in May, Part 12 in October, Part 13 in December, and this is Part 14 of the report.
History of Oakland
The King of Spain in 1820 granted about 45 thousand acres of land in what is now Alameda and Contra Costa counties to Luis Maria Peralta, a loyal soldier and explorer. Peralta divided his property, called Rancho San Antonio, among his four sons who, like other Spanish – and later Mexican – ranchers of the day, cultivated a few crops and raised some cattle.
The relative serenity of the Peralta estate lasted only until the Gold Rush, when three Eastern prospectors, disillusioned with their failure to find gold, sought their fortunes in what is now Oakland. Since anti-Mexican and anti-Spanish sentiment was quite high, especially after the Mexican American War, it was not difficult for Americans to dispute land grants held by Latins.
These three men, A.J. Moore, Horace Carpentier and Edson Adams, each staked claims to adjoining tracts of land amounting to a total of 480 acres and laid the foundation for the establishment of a town which was incorporated as such in 1852. Farmers and small businessmen were the principal settlers of the town, which soon boasted a city hall (1852), a school (1853), a newspaper (1854) and a regularized ferry service to San Francisco (1853-54).
The town became a city in 1854, and by 1869 had an active port, a bank, a hospital, a library association, a water company and paved streets in addition to being the major terminus for the first transcontinental railroad. By the latter date, there were already 10,000 persons residing in Oakland.
Growth was accompanied by problems of employment. During the latter part of the 1870s, Oakland was beset by large numbers of unemployed whites who were being forced out of jobs by the supply of cheaper Oriental laborers. Discontented laborers burned the city hall in 1877, and for many years, the anti-Chinese sentiment was very strong. This left intense feelings of racism, especially prevalent among the poor, as the city’s heritage.
Industrial evolution of Oakland
By 1910, there were 150,000 persons in Oakland with about 460 manufacturing establishments with an annual output of approximately $30 million. Its main producers were large food plants, packing houses, canneries, mills and iron works. These figures expanded rapidly so that by 1940 there were about 288,000 people with 1,415 industrial plants and an annual output of $500 million, with $62 million being in defense contracts (Peterson, 1967: 12-15).
The Second World War expanded Oakland’s economy even further, especially as the nation girded itself for defensive and offensive military operations. Defense contracts were boosted to about the $200 million mark, mainly connected with the war effort.
Two hundred fifty thousand Negroes were attracted to the Bay Area to work in shipbuilding, in defense plants, and in the Oakland Naval Supply Depot, Oakland Army Supply Base and Alameda Naval Air Station. By 1942, more than 142,000 people were employed as laborers in the city’s 11 shipyards (Peterson, 1967:13). Industries mushroomed fantastically. It appeared that Oakland would enjoy a continued boom indefinitely.
The cessation of the war, however, spelled disaster for the city. Many government contracts were withdrawn, leaving behind a large number of Negroes who were nonunionized, unskilled and semi-skilled workers recruited during wartime.
The improved freeway system enabled many old plants which were founded within the city proper to escape to suburban areas of the county where taxes were lower, and where an elite labor force could be drawn to staff modern, sometimes automated factories. The East Bay Manpower Survey (1967:8) reported: “In 1958, 56 percent of manufacturing employment was in Oakland, but by 1966, only 36 percent was within the City of Oakland. The city experienced a loss of jobs in most manufacturing industries with a resulting net loss over the period of more than one out of every five manufacturing jobs. While Oakland is still the manufacturing hub of the county, there is definite dispersion and shift of location to the southern part of the county.”
As heavy industry left Oakland, the better educated professional and semi-professional as well as managerial-level Caucasians followed suit, leaving the shells of abandoned factories and empty lots to the occupants of the slums – the relatively immobile and ill-trained Caucasians as well as Negroes, Mexicans and Mexican Americans and other minority groups. Some of the salient characteristics of this disadvantaged population are given in the following pages.
In recent years, Oakland has undergone dramatic demographic changes. The non-white population rose from 4.6 percent in 1940 to 14.1 percent in 1950, 25.7 percent in 1960 and to 34.5 percent in 1965 (Human Population Laboratory, 1966:52).
Concurrent with the immigration of non-whites, Caucasians have fled the city. The non-Spanish surnamed population (Anglos) fell from about 288,000 in 1940 to 271,000 in 1960, while the total city population rose from about 302,000 to 368,000 persons. Currently, there are over 100,000 non-whites in Oakland, and over 90 percent of these are Negro.
A rough estimate of Spanish surnamed persons and others of Latin American descent in Oakland would add another 40,000 (1967, unofficial estimate of Centro de Informacion y Servicios, Oakland), indicating an increase of about 24,000 since 1960.
A breakdown of the disadvantaged racial and ethnic groups in the city’s four Target Areas in 1965 is given in Table VII. As depicted there, the non-Target Areas are predominantly white while the Target Areas contain a high percentage of minority peoples. The age distribution tends to be more equally balanced between young and old in the non-Target areas. The Target areas, however, show a higher percentage of young children, of separated family units and a greater number of persons per household. From a socio-economic point of view, the Target Areas suffer disadvantages often hardly noticed or felt in non-Target Areas.
Both Negroes and persons of Latin American or Spanish heritage are concentrated residentially in the Target Areas. Seventy-four percent of the city’s Negroes and Spanish surnamed individuals are located there. Of the four Target Areas, only one, Fruitvale, has a majority of Anglos: 55 percent. In the others, the percentage of Anglos varies from 13 percent in West Oakland to 24 and 25 percent in North and East Oakland, respectively.
Thirty-seven percent of Oakland’s total population dwells in the Flatlands, or Target Areas, which house 77 percent of the city’s Negroes.
Inadequate housing characterizes most of the Target Areas. During the Second World War, thousands of temporary dwellings were constructed to house Southern Negroes, who were to work on various defense projects, particularly shipbuilding. Fifty-five percent of all Bay Area Negroes were living in such temporary structures by the end of the war, and all but about a tenth of such units were considered substandard in terms of structure, sanitation or population density.
When these units were condemned, Negroes were forced to seek low cost housing elsewhere. They found themselves shelter in the older section of Oakland and the surrounding cities. The breakup of public housing forced Blacks into a small number of census tracts in the cities of Oakland, Emeryville and Berkeley, and from that point on, residential segregation has accelerated the formation and expansion of the ghettoes.
Now that industries are moving to suburban all-white areas, where overt and covert forms of residential segregation exist, minority peoples are removed from the locus of work. With only very inadequate transportation, there is little hope for the minority community to be employed in areas which are inaccessible except by auto.
The conditions of housing are poor in the ghettoes; there is a low percentage of owner-occupied houses, and overcrowding is nearly universal. There is a great need for major and expensive structural modifications before rendering such housing sanitary or safe. Only 12.2 per cent of Oakland’s homes were owner-occupied by non-whites in 1965 and, of these, undoubtedly a great proportion were Orientals, thus reducing the involvement of Negroes as homeowners.
Overcrowding was evident insofar as data extrapolated for 1965 indicates that 16.6 percent of all non-whites were living in homes where there were 1.01 or more persons per room compared to 6.4 percent for the total population of the city living under the same conditions. Similarly, 23.7 percent of all non-whites in Oakland as contrasted with 16.3 percent of the entire population had a density of 0.76-1.00 persons per room. In addition to these problems of crowding, non-white families tended to be larger than those of the population as a whole, as inspection of Table VIII will reveal.
Joseph Debro, born Nov. 27, 1928, in Jackson, Miss., and a pillar of Oakland until his death on Nov. 5, 2013, was president of Bay Area Black Builders and of Transbay Builders, a general engineering contractor, former director of the Oakland Small Business Development Center and the California Office of Small Business, co-founder of the National Association of Minority Contractors and a bio-chemical engineer.