Racial Wealth Snapshot: Asian Americans
EDITOR'S NOTE: This is the third of a series of snapshots from Prosperity Now's Racial Wealth Divide Initiative providing key data on racial wealth disparities in America. The first snapshot looked at the racial wealth divide facing Black Americans, and the second presents important facts for understanding how wealth divides play out at the intersection of race and gender.
Asian Americans and the Racial Wealth Divide
Asian Americans are the fastest-growing racial group in the United States, with a population expected to double in the next 50 years. Asian American is a racial category that includes Americans who are from or whose relatives are from a diverse group of countries: China, Korea, Japan, India, Pakistan, Thailand, Vietnam, the Philippines and many others.
Trends suggest that Asian and Pacific Islanders (API) have fared better economically relative to other racial groups in part due to highly educated immigrants. Asian Americans, on the aggregate level, may have a higher income than White Americans, but API families have more incomes per household. When family size and educational attainment are factored in, we see that Asian Americans, in general, do not have higher incomes than White Americans. Although Asian Americans generally earn more than most communities of color, they face shared challenges of economic inequality and insecurity.
Asian Americans consist of a multitude of immigrants and descendants from countries in Southeast, South, East and Central Asia. The majority of Asian Americans are immigrants, with 66% of them being foreign-born. Most Asian Americans are of Chinese origin, comprising four million individuals out of the 18 million Asian Americans in the United States. Following behind are Filipinos, Indians, Vietnamese, Korean and Japanese at 3.4 million, 3.1 million, 1.7 million, 1.7 million, and 1.3 million, respectively. As of 2015, Asian Americans make up 5.8% of the total U.S. population, and are expected to reach 14% by 2065.
California and New York’s metropolitan areas, such as New York City, Los Angeles and San Francisco, are densely populated with Asian Americans and are considered hot spots for Asian migration. California is home to nearly six million Asian Americans, while New York has approximately two million Asian Americans. Twelve percent of recent Asian immigrants settled in the New York-New Jersey-Pennsylvania area, and eight percent are in the Los Angeles area. Smaller cities, however, have also experienced a recent influx of Asian migration.
The household median income for Asian Americans is $74,829, 39% greater than the national median income of $53,657. Indian Americans have a higher household income than any other Asian American subgroup, with a median household income of $101,591. After Indian Americans comes Filipino, Japanese and Chinese Americans with high median incomes of $82,839, $70,261, and $69,586, respectively. However, there are vast variances in Asian groups in terms of household income, as Bangladeshi Americans have a median income of $51,331, which is almost 50% lower than Indian Americans.
Asian Americans as a whole earn more than any racial category in the United States. But when educational attainment is factored in, Asian Americans still make less than White Americans. White American men with a bachelor’s degree earn $72,599 on average, while Asian American men with the same degree make $56,921. Though the disparity is smaller between white women and Asian American women, there still exists an income disparity that ranges up to $4,000 when looking at various educational levels.
Asian American income must also be understood in light of the fact they have larger households (3.02) as compared to the national average of 2.6. Also, Asian Americans are disproportionately concentrated in areas with the highest cost of living, which reduces the overall benefits enjoyed by higher incomes.
Economic insecurity within the Asian American community is evinced by its poverty rates. As of 2011, the Asian American poverty rate was almost 14%, three percent higher than White Americans. When a cost of living adjustment was included, Asian American poverty increased to about 16%, six percent higher than White Americans. And if we examine Asian Americans by nationality we can find some particularly alarming poverty rates. For example, Hmong, Cambodian and Laotian Americans tend to be at the bottom of the economic ladder for Asian Americans, with very high poverty rates of about 38%, 29%, and 18.5%, respectively.
Asian Americans have the lowest unemployment rate across any household of color, with only 3.0% of the population unemployed. This low unemployment rate is partially due to Asian Americans’ having higher educational levels on average than White workers. Again, some Asian American nationalities have particularly high unemployment rates. The Vietnamese American community has the highest share of unemployed workers who are long-term unemployed (30.2%), trailing only non-Hispanic Black community (34.7%).
Forty-nine percent of Asian Americans aged 25 years and older have a bachelor’s degree or higher, which is higher than the U.S. population (28%). The ethnic groups with the highest share of college graduates are Indian Americans (70% of whom have B.A. or B.S. degrees) and Chinese and Korean Americans (about 50% of whom have a bachelor's degree). Twenty-one percent of Asian Americans also have advanced degrees, in comparison to 14% of Whites. The high levels of educational attainment are connected to the primary “pull” factor of Asian American immigration: high-paying jobs.
Asian Americans have higher median wealth than Blacks and Latinos with a 2013 median wealth of $91,440. But they have substantially less wealth than White Americans whose median wealth in 2013 was $134,008. Asian Americans also suffered the greatest loss of wealth during the great recession, highlighting the economic vulnerability of this community.
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