The Washingtonian’s View

U.S. Speaker of the House and California Congresswoman Nancy Pelosi, believes Asian Americans and Pacific Islanders (AAPI) are a critical part of the United States’ national growth and success.  Presently, there are more than 14.4 million Americans that identify themselves with an Asian or Pacific Islander background.  AAPI represents more than 16 ethnic backgrounds, speaking nine different languages, and belonging to a number of different religions and cultures, their diversity is the beauty and strength of our country.

There is plethora of notable Asian Americans.  Think about the architecture of Maya Lin, the Vietnam Memorial designer; or how about the musical styles of Toshiko Akiyoshi, famous Jazz pianist.  What about the acting credits to Tia Carrere, Margaret Cho, Bruce Lee (1940-1973), or Keanu Reeves?  There are famous Asian American reporters like:  Connie Chung, K.W. Lee, and Ann Curry, and lets not forget about Brooke Lee, Miss Universe 1997 or Ang Lee, Movie Director.

If those people are unfamiliar to you, think about the athletic skills of Michelle Kwan, Tiger Woods, Kristi Yamaguchi and Brian Yee.  And you cannot forget about Jerry Yang, Co-founder of Yahoo; Vera Wang, Fashion designer; Daniel K. Akaka and Daniel K. Inouye Senators. Hawaii; Norman Y. Mineta, U.S. Secretary of Commerce; first Asian-American Cabinet member; Donna E. Shalala Secretary, U.S. Dept. Health & Human Services; John Sununu Senator, New Hampshire and Hisaye Yamamoto, author.

The bottom line is:  Asian Americans contribute greatly to the United States, as one would assume.  Asian American owned businesses have helped to boost the American economy for decades; but just recently is getting more attention.  They [Asian Americans] are invaluable to the American industry.

In the area of small businesses, Asian Americans have dominated. Since the arrival of new immigrants (since 1965), Asian communities have proliferated. Walk around any Chinatown, Little Tokyo, Koreatown, or Little Saigon and you’ll see hundreds of small shops and businesses, selling everything from traditional foods, ethnic music, travel, haircuts and manicures, flowers, and liquor.

Without the goods and services they offer, much of the American money machine would come to a screeching halt. The phenomenon of Asian Americans coming into the proprietorship of small businesses is no fluke.  In the last several years the idea has received a lot of attention.   Some of this attention has been positive, while [as with many things] there has been some negative press.

The growth of the overall American economic juggernaut is directly and intrinsically tied to the growth of Asian small businesses.

In a 2000 U.S. Census, the Public Use Microdata Samples (PUMS), listed the rates of all people living in the United States who are of Asian decent, self-employed and are 25 years of age or older. This census primarily dealt with the seven major Asian ethnic groups. Interestingly, the study shows that foreign-raised Asians (those who immigrated to the U.S. at age 13 or older) are much more likely to be self-employed than U.S.-raised Asians (those who are either U.S.-born or who immigrated to the U.S. before age 13 — the “1.5″ generation).

The study also concluded that among foreign-raised Asians, Koreans have the highest self-employment rate at almost 28%. The rate of being directly involved in a family small business in one form or another is probably even higher than that, when you count family members or relatives who work for Korean store owners.  However, Koreans do not have the highest self-employment rates among the U.S.-raised — rather, Taiwanese do. In fact, research shows that in the last couple of decades, women, immigrants, and people of color have entered self-employment in increasingly larger numbers.

A couple of weeks ago the Organisation of Chinese Americans (OCA) met to discuss major issues affecting not only Chinese Americans, but also the Asian American community as a whole.  The focus of the conference was to make note of the progress Chinese Americans has made in the past 35 years and the huge potential for advanced progress in the future.

The organisation’s mission is to serve as a national organization that is dedicated to advancing the social, political, and economic well being of Asian Pacific Americans in the United States.

The OCA’s conference was informative and resourceful.  It made sense of much of the information that one could find floating in the field.  The conference selected an impressive number of people that had not only academic experience in the field, but real personal knowledge.  That’s something that an academic textbook can explain in raw detail.

The conference was sponsored in part by AT&T, Asianweek, KLL Investments, PepsiCo, INC, State Farm and Verizon.   As far as exhibitors, representatives from the Department of Energy, Department of Citizenship and Immigration Services, the Department of Justice, and the U.S. Postal Service.

The organizers even made time to provide a career services department, a health fair, and a seniors day.

Extra special interest was given to sessions centered around globalization, grassroots mobilization for the ’08 elections, and small business ownership. There was another area revolving around youth leadership.  Overall, the issues discussed were along the same lines of another powerful organization, the U.S. Pan Asian American Chamber of Commerce Education Foundation (USPAACC-EF).

In late May the U.S. Pan Asian American Chamber of Commerce Education Foundation held its 23rd Anniversary CelebrAsian Business Opportunity Conference.  The conference was held at the Hilton Washington, the same place where the OCA was held.

During the USPAACC-EF, CEOs representing the “50 Fastest-Growing Asian American Businesses” were among the 700 attendees.  Those CEOs’ businesses generated $4.9 billion in revenues in 2007.

CelebrAsian is known as the largest gathering of its kind in the United States.  It focuses on bringing together Asian American suppliers and small business owners with buyers for Fortune 500 corporations, the federal government and the small/minority business community.

One looming question that seems to permeate through this piece is, “Why are so many Asian immigrants opening up their own businesses?” The answer may surprise you.  Actually, the answer to that is broad indeed.  There are many reasons why, but in looking at this from an academic position you see how many of these reasons overlap with one another.

There is the theory of Labor Market Discrimination, which argues that immigrants try to find a “regular” job as an employee working for someone else but can’t and therefore have no choice but to go into business for themselves.  This can be because of the immigrant’s inability to speak English fluently, his/her educational or occupational credentials from her home country are not recognized by U.S. companies, and possibly the common reason being simple discrimination by the employer based on race.

The best examples of this theory are the experiences of Chinese immigrants in the late 1800s.

Another widely accepted view is the theory of Cultural Traits or Ethnic Resources. This theory says that immigrants chose to go into business for themselves when they apply their cultural traditions of working hard, delaying material gratification, and sacrificing for the next generation.  Within this theory they rely on using family, relatives, or other immigrants in their ethnic group as unpaid or cheap labor. They also sometime set up an informal savings and loan arrangement with friends or relatives to get start-up capital.

A third theory is called the theory of Class Resources. Here, Asian immigrants plan from the beginning to open their own business using specific education and job skills gained just for that purpose (i.e., a business degree or an apprenticeship). Within this theory, the idea is they tend to have “Americanized” attitudes and norms of behavior that makes it easier for them to relate to their Asian and non-Asian customers and community.

Finally, there is the theory of Structural Opportunities, which has three separate sub-theories or “models.” The first is the Middleman Minority model. This model argues that middle and upper-class Whites business owners hire Asians to work as a “buffer zone” to Black or Latino working-class customers. The second model is that of the Ethnic Enclave. This argues that the Asian immigrant business owner is bet served by opening their businesses within their own ethnic community or enclave.   The last model is Economic Openings. As White small business owners sell their businesses in inner cities, Asian immigrants take over in these areas.

“Considering that the USPAACC-EF has been at the forefront of educating, training and nurturing of Asian American suppliers and small business owners, it would only make sense that these organistions grown and improve even the most basic of all American life,” said Susan Au Allen, USPAACC-EF National President and CEO.

Asian American businesses have made a considerable impact in U.S. markets.  Even in a down market Asians Americans have found ways to contribute positively.
A few months ago I attended the Wells Fargo Asian Business Leadership Awards here in Washington, D.C. The crowd was upbeat and promising – even a bit more optimistic than most other organizations at the time.  In attendance was Jack Perkowski, ASIMCO Technologies chairman and CEO and best-selling author of Managing the Dragon: How I’m Building a Billion-Dollar Business in China.  Perkowski shared his experiences in building a billion-dollar business in China.  He explained the end result comes with leering patience and self-control.

In getting a business set in China it takes 13 different levels of red tape.  Some Western companies eventually gave up; but for those that were steadfast, they made millions by tapping into the billion plus people.

Modern census figures showed that in 2002 there were over 1.1 million Asian American-owned companies.  These companies produced over $326 billion in revenues.  The Department of Labor and the Small Business Association both project these businesses to generate over $597 billion in revenues in 2010.

Also, as the U.S. economy changes from one based on manufacturing to services, more service-oriented business opportunities develop. These businesses tend to offer easy entry but also involve high risks of losses or failures (i.e, garment, groceries and restaurants, personal services, and retail sales).

Headquartered in Washington, D.C., USPAACC-EF has a nationwide reach through regional chapters in Northern and Southern California, New York, Texas, Illinois, Georgia, and Washington, D.C.-Maryland-Virginia in the national capital area.