The New Deal and Racial Exclusion: A Lasting Divide in Infrastructure Opportunities
The New Deal, hailed as a transformative economic initiative, funded large-scale public works projects to revitalize the American economy during the Great Depression. However, these taxpayer-financed projects overwhelmingly benefited white-owned construction firms while systematically excluding Black and Hispanic/Latinx businesses. This exclusion created a vast wealth and experience gap that businesses of color still struggle to catch up with today.
Unequal Access to Public Contracts
The construction of dams, airports, tunnels, and other infrastructure projects funded by New Deal programs—like the Public Works Administration (PWA)—solidified the dominance of white-owned firms. Despite performing labor on many projects, Black workers and contractors were excluded from leadership roles and prime contracts. These early opportunities gave white firms a competitive head start, building experience, relationships, and capital that continues to benefit them today.
While New Deal projects aimed to stimulate economic growth, they effectively reinforced existing racial inequities. Black and Hispanic/Latinx firms were denied the chance to participate in large public works projects, leaving them out of lucrative markets and depriving them of the opportunity to grow at the same pace as their white counterparts.
Fluor vs. McKissack: A Case Study of the Wealth and Experience Gap
The disparity in opportunity is evident when comparing major construction firms like Fluor Corporation and McKissack & McKissack. Fluor, headquartered in Irving, Texas, reported $15.5 billion in revenue in 2023 and is ranked 303 on the Fortune 500 list. With over 110 years of experience, Fluor offers engineering, procurement, and construction services worldwide, cementing its place as a global leader.Wikipedia
In stark contrast, McKissack & McKissack, one of the oldest Black-owned construction firms in the U.S., reported peak revenue of $8.5 million in 2023. With only 150 employees and a revenue-per-employee ratio of $56,980, McKissack’s scale is minute compared to Fluor. While McKissack’s achievements are commendable, the comparison underscores the glacial gap between firms built with historic access to capital and infrastructure opportunities and those excluded.Encyclopedia.com
The Need for Seismic Intervention
Today, capital and experience remain crucial to securing large infrastructure contracts. However, the historical exclusion of Black and Hispanic/Latinx firms makes it nearly impossible for these businesses to meet such requirements. Many firms of color are limited to subcontracting roles, while industry giants like Fluor dominate prime contracts and industry publications, further marginalizing smaller firms from recognition and growth.
To bridge this divide, bold and transformative actions are necessary, including:
Equitable Access to Contracts: Award prime contracts to minority-owned firms, ensuring they receive the same opportunities as their white counterparts. This goes beyond subcontracting to place businesses of color in leadership roles for large-scale projects.
Targeted Capital Access Programs: Establish specialized loan and grant programs for businesses of color, acknowledging the historical exclusion and systemic inequities they have faced. These programs should address the residual impact of legal segregation and the economic disparities hindering their growth.
Industry Inclusion and Data Transparency: Actively feature minority-owned businesses in industry publications and ensure their growth is tracked and reported with the same rigor applied to larger firms. This transparency will highlight successes, identify challenges, and promote accountability within the industry.
These interventions are essential to dismantling the barriers created by past discrimination and fostering a more inclusive economy that allows businesses of color to thrive.
The comparison between Fluor and McKissack reveals a deep, systemic inequity rooted in the racially exclusive practices of the New Deal era. The gap will remain without structural changes in how contracts are awarded and how businesses are capitalized. McKissack’s achievements reflect resilience and highlight the overwhelming need for systemic reforms to ensure that future opportunities are more inclusive. Only with intentional efforts can we begin dismantling the barriers that have kept businesses of color from fully participating in and benefiting from the American economy.
