Asian-owned small businesses face challenges in growing their businesses, but contribute to the economy by creating jobs for unskilled immigrants, according to the study “NYC’s Economic Engine: Contributions and Challenges of Asian Small Businesses.”
The study was issued by the Asian American Federation (AAF) in a press conference on December 6.
Specific to the Filipino community, the study reports that Filipino firms declined (-41 percent) in economic activity from 2007 to 2012, and likewise saw drops in overall payroll (-27 percent).
The report states Filipino entrepreneurs were dominant in at least two industries: HealthCare and Professional Services. They were likely to operate child day care centers, provide support services to businesses and buildings or they could be physicians with their own private practice.
“Asian-owned firms were more likely to be smaller firms because of the way ethnic ownership is defined,” says the study. “Asian-owned firms were more likely to be in the services sectors with lower wages overall.”
The report says Asian businesses accounted for half of net new economic activity and half of net new paid employment in New York City from 2002-2012. At the same time, self-employed Asians had 10-percent lower median wages and earnings compared to their non-Asian counterparts.
Key findings of this report include:
- The number of Asian-owned businesses in New York City grew faster than the overall number of businesses from 2002-2012. In fact, Asian-owned businesses accounted for 31 percent of net new businesses during that time period.
- Asian-owned businesses were concentrated in service sectors, including taxi and limousine services, retail, personal care services including beauty and nail salons, food services, and construction. In other words, Asian-owned firms were more likely to be in the services sectors with lower wages overall.
- While Chinese-owned businesses accounted for almost half of all Asian-owned businesses, the largest growth in the number of businesses occurred among Japanese- and Other Asian-owned businesses, with Bangladeshi and Pakistani owners making up the bulk of Other Asian business owners.
- Self-employment may be the option some Asian workers take because they are shut out of the mainstream job market due to language skills or citizenship status.
The study makes the following recommendations to the city to better support Asian-owned small businesses:
- Address the growth and diversity among Asian small businesses. Tackle the diversity of languages spoken in the city and build comprehensive and robust assistance programs that reach all of the potential entrepreneurs in the Asian community.
- Improve awareness of existing programs that help Asian-owned businesses comply with rules and regulations by creating a single point of contact for Asian owners and by working with chambers of commerce and business associations to provide relevant education to small businesses.
- Create new programs or enhance existing ones that support the expansion of small businesses.
- Develop training programs that improve the skills of small business workers, such as English classes that address workplace needs and workforce training programs that are closely aligned with small business needs.
Jo-Ann Yoo, executive director of the federation, said, “Asian small businesses have increasingly become a vital economic force in New York City, and this report finally provides the numbers to prove that our city depends on Asian entrepreneurs to sustain its economic activity and employment rate.”
“Asian-owned small businesses were borne out of necessity,” said Howard Shih, research and policy director of the federation. “Yet, despite being shut out of mainstream jobs due to limited English proficiency and/or citizenship status, Asian New Yorkers have found a way to shape the very fabric of this city’s economy. With real investment in their education and training, we are certain to see a great return on our investment in the long term.” – Cristina DC Pastor/The FilAm