New Study: AAPI buying power increasing faster than any other group

Asian Americans buying power is growing faster than any other ethnic group.

"Asian Americans command an estimated 6.2 percent of the nation’s total buying power, roughly $1 trillion," says a new study released last week by the University of Georgia.
"The 267 percent increase since 2000 makes the Asian market the fastest-growing minority market in the country, with a buying power greater than the gross domestic product of Turkey," continues UG's Multicultural Economy Report.

“While minority markets are certainly enjoying more buying power than ever before, the rate of growth differs. We find the largest percentage increases in the Asian and Hispanic markets, followed by relatively slower rates of growth in the African American and Native American populations," said UG economist Jeff Humphreys, author of the study.

"Whites (still) comprise the largest share of the U.S. market, but have the slowest percentage rate of buying power growth.”

The UG report, which also had sections on Hispanic and Black communities' buying power, broke down the buying power of the five largest Asian subgroups:

• Indian Americans, which is the fourth largest group in terms of population, is the strongest in terms of buying power with  $283 billion (28 percent).  
• Chinese Americans (except Taiwanese) are second in terms of buying power, making up 23 percent of the U.S. Asian market ($233 billion) but are the largest population. 
• Filipino Americans constitute the third-largest group both in population and buying power, accounting for $146 billion or 14.4 percent of the market. 
• The fifth most-populous group is Korean Americans, who rank fourth in terms of buying power with $81 billion or 8 percent of the U.S. Asian market. 
• Vietnamese Americans are fifth in terms of buying power ($73 billion).

The Asian American market is buoyed by booming population growth, which includes strong immigration, high educational attainment, increased entrepreneurship, and an overwhelmingly urban population.

The growth rates in the top 20 fastest growing states indicate that Asian Americans are moving beyond the traditional AAPI population centers on the West Coast, Chicago, New Jersey and New York City and moving into unexpected areas such as the Dakotas bolstering an already established trend towards the southern states.

Ranked by the rate of growth of Asian buying power since 2000, the top 10 states are: South Dakota (497 percent), North Dakota (479 percent), Arkansas (449 percent), Vermont (445 percent), North Carolina (422 percent), Texas (414 percent), Arizona (387 percent), Georgia (369 percent), Nevada (361 percent), and Indiana (357 percent).

While Texas is the only state that also ranks among the nation’s 10 largest Asian consumer markets (at third), Georgia (13th) and North Carolina (15th) are also among the nation’s most rapidly emerging Asian markets.

The Asian American market is bolstered by rapid population growth and employment gains. From January 2000 to March 2017, the number of jobs held by Asian Americans increased by 3.6 million, or 63 percent. The population also benefits from high educational attainment and a marked increase in Asian-American business startups.

Where Asians spend more:

• dining out
• housing
• public transportation
• education
• clothing

Where Asians spend less:

• utilities
• used cars
• cash contributions
• health care
• entertainment

“The Asian market is partially underserved because it’s less unified than some of the other groups and has many different languages and customs, comparatively,” said author Humphreys. “That makes it harder for marketers to craft a one-size-fits-all advertisement, but makes a great opportunity for more niche targeting.”

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