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How Income Inequality Became A Big Issue Among Asian Americans

How Income Inequality Became A Big Issue Among Asian Americans. Asian Americans look pretty well-off. They lead in economic measures such as household

Monday, May 24, 2021

/ by Avishek Bera


The News Cover: 
From a quick glance, Asian Americans look pretty well-off. They lead in economic measures such as household income, consumer spending, and education levels. But let's take a deeper look at the numbers. Take household income, for example. The median for Asian households was $85,800 in 2019. But if you break it out, you'll see at the low end Burmese Americans with household incomes of 44,400, less than the median of all U.S. households. 

And at the high end sits Indian Americans with $119,000. When we add in other Asian ethnic groups, you'll see that the original number of 85,800 might not be as representative as it seems. Asian Americans are the most economically divided racial group in America. While they are more likely to hold high-income white collar jobs. Asian American workers also hold a significant number of low-income service jobs. So most national data sets look at the community in aggregate. 

And so when you combine it, it looks like Asian Americans and Pacific Islanders are doing well and often disguises, you know the realities of what those at the lower end of the economic spectrum are experiencing. And this has set up problems for the fastest growing racial group in the US, which includes subgroups for more than 20 countries. When we categorize all of these cultures as Asian American, it leads to generalizations. 

In reality, it's a lot more complicated. Here's a look at the growing income inequality in the Asian American Pacific Islander community and why it's hard to tackle. The term Asian American Pacific Islanders includes more than 40 ethnicities and subgroups. The six largest groups in the U.S. are Chinese, Indian, Filipino, Japanese, Korean, and Vietnamese. Today, Asian Americans are the fastest growing racial or ethnic group in the U.S. It's also the only major group whose population is rising because of immigration. 

From 1965 to 2015, the Asian population in the U.S. grew from 1.3 million to 18 million and 98% of that came from immigration. The 1965 immigration reform have a profound impact on Asian immigration. The policy has two goals. One is to allow for families unification so that it's a humanitarian goal, and the other is an economic goal of bringing in needed labor. The Immigration Nationality Act of 1965 vastly increased the numbers of Asian immigrants in the U.S. It prioritized highly-skilled and educated immigrants in careers like medicine, science and tech. 

This new wave of immigration helped confirm the stereotype of Asian Americans as the model minority. They were seen as the successful law-abiding minority who through hard work were able to achieve financial success. The concept has been used as a political wedge to minimize the institutional disadvantages other marginalized groups face. Scholars argue the model minority myth hides the inequities in the Asian subgroups. One example is Southeast Asian refugees who came to the US during the 1970s to 1990s. During that period, the number of Asians working in low-skilled occupations grew while those in high-skill occupations fell. 

When you come here as a refugee like my parents did, you're coming from, you're coming from war, you're coming from families that have been torn apart. You're kind of, you know, just dumped in the ghettos where the government can put you and you have a different mentality. It's more of like that survival mentality. For Asian Americans and Pacific Islanders, that wealth gap is largely due to immigrant selective selectivity. That is different groups are selected from their socioeconomic background and a context of immigration. So that would have consequences on their socioeconomic well being in a whole society and also their wealth. 

New immigrants who don't come with a highly-skilled work visa often have limited job options because of language barriers, lack of work experience and education. If you have this skill, you can get incorporated into the larger labor market and move up from there. But if you don't, then you either have to experience this downward mobility by taking low-wage jobs and gradually move yourself up. Or you can go through entrepreneurship. Opening up small businesses is more common among Asian Americans and Pacific Islanders than other communities. People don't have other opportunities and so they they shift to building businesses as a means of generating income and wealth for their families. 

My dad came here from Pakistan and lived in New York City before he married my mom. While he was in New York City, his first job was at Duane Reade unboxing, and being a load guy and he worked at ton of odd jobs like that. And he really did whatever you could and as many jobs as he could, in order to build his wealth, and in order to just have a footing in America, My family told me that I am the inventor. So I can see when I started business, I don't have any family member or any friend in this kind of business. 

It was just keep looking at and I have a confidence myself that I can learn. But after me, a lot of other family people and the friends they got in this kind of business. Recent studies have found that the AAPI population was more likely than any other racial group to ask friends, family, or rely on themselves for financing or business advice instead of going to institutions. My parents were from Vietnam, and they immigrated over to America in the 1980s. They were boat people, they were on a boat and traveled to Thailand and then had a sponsor in California. So they landed in Oxnard, California, so they didn't have any skills or any job opportunities. 

During the pandemic, it was found that Asian American Pacific Islanders experienced some of the worst economic effects. As more data comes out post-pandemic it could be an even darker reality. You're gonna see phenomenon where those who are more fortunate, probably did better. We did a study ordered by the James Irvine Foundation that found that Southeast Asian and Pacific Islander communities were more likely to work in gig professions. And we know the kinds of economic struggles that the gig economy has presented during the pandemic. I think once all of the data come out from this 2020-21 period, we're going to see these inequalities actually get worse in the Asian American and Pacific Islander community. 

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