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Why are so many Asian Americans unemployed during the COVID-19 pandemic?


An intriguing phenomenon

In the past, Asians in the US consistently enjoyed low unemployment across all racial groups, even in 2009−the worst year of the Great Recession. During the COVID-19 pandemic, however, Asians experienced unemployment rates higher than Whites, peaking at 15% in May 2020. Even as the economy started to improve and the unemployment rate began to drop in recent months, the recovery for Asians was slow, and unemployment remained uncharacteristically high.

This is puzzling. Why are things different with Asians this time around?

Overall, adults who have at least a college degree have experienced lower unemployment during the pandemic. Asians have the highest level of educational attainment of all racial groups: 56% of Asians ages 25 and above have a college degree or higher, compared to 35% among Whites. Based on education, we would expect Asian unemployment to be low, but this wasn’t the case.

A few unique demographic, cultural, and geographic aspects about Asian Americans are presented in this article to help explain why Asians are experiencing uncharacteristically high unemployment during the pandemic. We suspect, in addition to involuntary unemployment, perhaps there also was a significant amount of voluntary unemployment—opting out of the work— among Asians, due to a greater awareness of COVID-19 and its fatal consequences.


Home country influence

Unlike populations of other races, more than three quarters of adult Asians in the U.S. (77%) are foreign-born. Among those who are native born, 45% are under age 18, many of whom are the children of Asian immigrants. This means that Asians in the U.S. are often well-connected to their home countries.

Because COVID-19 first broke out in Wuhan, China and quickly spread to South Korea, Japan, Taiwan, Singapore, Vietnam, and other Asian countries, many Asians in the U.S., especially those from East and Southeast Asia, had early and first-hand knowledge about the lethal nature of the virus. The extensive network of family and friends in home countries, coupled with the vast amount of information shared through social media and news outlets in native languages, allowed many Asian Americans to witness a far more grim and dire situation than what was reported within the U.S. For example, the ultra-strict lock down measure implemented in China was unprecedented and provided a clear and chilling indicator to Chinese Americans regarding the severity of the coronavirus.

Memories of SARS

In addition, vivid memories of SARS in China, Hong Kong, Taiwan, Vietnam and Singapore in the early 2000’s led to heightened alertness of the coronavirus among Asians. The severity and devastation of the SARS scare and the remarkable similarities between SARS and COVID-19, prompted many Asians to maintain a high level of vigilance and caution from the very beginning of the pandemic.

Early adoption of precautionary measures

A high degree of alertness and fear of the virus among Asian Americans was visibly evident. Many East and Southeast Asian communities cancelled the 2020 Lunar New Year celebrations in February when COVID-19 cases were reported in the U.S. Asians were among the first to start wearing face masks, which led to some backlash with a number of anti-Asian incidents being reported. When PPE’s were in short supply, it was widely reported that Asians, especially those of Chinese origin, in communities across the U.S. were securing and donating large number of face masks to health care and other front line essential workers.

While mask wearing was met with considerable resistance across the country, it hardly was a politicized issue among Asian communities, where the attitude towards masks is perhaps equivalent to the motivation behind wearing seat-belts—both are regarded as essential for protecting lives. In addition, wearing masks in public is a common practice in many East Asian countries, for protection against the spread of respiratory diseases during cold and flu season, or from air pollution and smog, or sometimes simply against the wind chill during cold winters.

Work and School

Given this high level of alertness and vigilance, it is reasonable to assume that many Asians chose to stay home instead of continuing to work or returning to business-as-usual models once stay-at-home restrictions were eased. There is no data to show how much of this unemployment was voluntary due to self-selection, but there is anecdotal evidence that shows how certain Asian restaurants delayed re-opening and some Asian super markets faced a shortage of willing and available Asian workers, hence hiring Hispanic cashiers and workers to fill the positions instead.

The same reasoning that prompted Asian adults to opt out of work may also be applied to Asian families’ choice of keeping kids away from in-person schooling. Many school surveys indicate that Asians are more likely to choose online learning during the pandemic—another manifestation of pandemic vigilance adopted by Asian Americans. In New York City, for example, over three quarters of Asian children opted for remote learning compared to 43% of Black students and 41% of Whites. And while vigilance may be the root cause, the need to supervise children who are learning from home may further contribute to lower employment or reduced work hours for parents.

Geographic Concentration

Geographic factors may also impact voluntary and involuntary unemployment behavior among Asians. Asians are heavily concentrated in large metro areas and in states such as California, New York, and New Jersey, where the economies were among the hardest hit during the pandemic. High unemployment in urban centers may have disproportionately impacted the Asian labor force, which is over-represented in professional and technical services, colleges and universities, hospitals and dental offices, as well as in accommodation and food services, personal and laundry services, and taxi services. Jobs in these sectors were among the most affected by the pandemic, which in turn is reflected in the statistics as increased Asian unemployment.

Financial Feasibility

High unemployment rates often suggest economic hardship. For cases of voluntary unemployment during COVID-19, people may be making a deliberate decision to balance health and safety against earning a livelihood. Asians families could potentially be able to make these economically costly decisions partly because of their higher income overall and partly because of their higher saving rates across all income levels.

Asians have the highest median household income among all racial groups in the U.S (nearly $94,000 in 2019, compared to nearly $70,000 among Whites). In addition, Asian cultures strongly encourage saving money and accruing assets to protect against unexpected disaster or illness and to build a future for descendants. Hence, Asian Americans may be better positioned financially to ride out the pandemic and forgo work for a short time.

Returning to low unemployment

However, Asians will be able to opt out of work for only so long. As the pandemic prolongs and fatigue kicks in, so will practical realities and financial pragmatism. In the same way that news from overseas, caution, and vigilance led Asians to withdraw from the labor market, perhaps the knowledge of how effective precautionary measures are and the promise of a vaccine will organically bring them back into the workplace. We expect that the uncharacteristically high unemployment figures for Asian Americans are temporary and will gradually improve in tandem with other race groups. When the pandemic is over, Asian unemployment will likely experience a recovery to the previously low levels.

NOTE: Data points sourced from ACS 2019 1-year and BLS Employment Situation.