7.8% of Philadelphia’s 1.6 million population are Asians and 11% of Philadelphia’s small businesses are Asian-owned, according to the U.S Census estimate released in January 2022. Philadelphia has 12.1 businesses per 1,000 residents and Asians place the highest rate of business formation with 30 firms per 1,000 Asian residents according to the Central Philadelphia Development Corporation report released in August 2020.
Recently, Goldman Sachs released a Research Paper on Asian Americans' contributions to the U.S. economy. Asian Americans drove 23% of US private sector output growth from 2003-2019. This translates to a total GDP growth contribution of $1.5 trillion in current dollar terms. Asian Americans have also driven 22% of US employment growth during this period, despite accounting for just under 6% of the US population in 2019. In 2019 alone, AAPI households earned more than $783.7 billion in income. This allowed them to pay more than $167.9 billion in federal income taxes and almost $72.5 billion in state and local taxes.
Asian Americans and Pacific Islanders make up 5.8 percent of the U.S. population but we account for 7.7 percent of all federal income tax paid and 6.8 percent of total spending power in the United States. The AAPI community is as diverse economically as it is in terms of their ancestry. The popular misconception that all Asian Americans are wealthy, or that they somehow constitute a “model minority,” hides lingering challenges and struggles that many smaller AAPI groups face.
The Asian business community in Philly represents a great diversity of Indian, Chinese, Korean, Japanese, Filipino, Vietnamese, Cambodian, Thai, Burmese, Indonesian, Pakistani, and Laotian businesses to name a few. To have all these businesses in one area means we have an incredibly dynamic workforce and multicultural talents that are integral to the City’s socio-economic development.
The Impacts of COVID-19
Pandemic-related closures and restrictions on indoor gatherings were particularly hard on the restaurants, clothing, and jewelry stores, nail and beauty salons, and other service industries in which many Asian-owned firms are concentrated. Revenue in Philadelphia’s Chinatown fell 40% a year after pandemic lockdowns and COVID regulations took place, leaving many immigrants with limited English skills struggling. Many businesses were forced to close down like Rangoon restaurant and T.T Skewer in Chinatown, with little business due to the pandemic and soaring costs on meat and produce. Staff shortages and supply chain disruptions also contributed to the shutdown of many Asian-owned businesses. The shifting health mandates, COVID-19 caseload surges, rise in Asian hate crime, unsafe community with a significant number of shooting and drug dealing activities, and most importantly hefty taxes have really discouraged so many AAPI-owned businesses to stay open in the city.