Report: COVID-19's heavy impact on Asian American workers and businesses

Asian-owned businesses hit hard by the COVID-19 pandemic continue to suffer.

The devastating human toll of COVID-19 on Filipino nurses — who made up a staggering majority of healthcare worker deaths early in the pandemic — exposed just how vulnerable Asian American communities were on the front lines. The resulting crisis was just as wide-ranging and severe across the broader AANHPI labor force, according to a new report.

“An important question to consider for the future is whether these disparities will continue as the economy reopens and be exacerbated by the apparent increase in anti-Asian sentiment in the US,” said Paul Ong, co-author of the report and director of the Center for Neighborhood Knowledge at the UCLA Luskin School of Public Affairs.

In an earlir report taken in 2021, Ong explained that because Asian-owned businesses tend to be in sectors that were the most impacted — such as food service, hospitality and retail — many of them didn’t have the money to keep their businesses open when profits took a nosedive.

        RELATED: Even as they saved lives, Filipino nurses faced racism

Analyzing labor data from California and New York between March and May 2020, researchers found that AANHPI workers and businesses suffered disproportionate job losses and small business closures compared to their white counterparts, according to report released earlier this month  from the UCLA Center for Neighborhood Knowledge, the UCLA Asian American Studies Center, and Ong & Associates.

“The racism throughout the pandemic also led people to avoid businesses in Asian neighborhoods altogether,” Ong added. 

Key findings

Widening Joblessness Gap: Prior to the pandemic, unemployment rates for Asian Americans and white workers were nearly identical. By May 2020, Asian American unemployment jumped to 15% (with overall joblessness at 21%), compared to 12% unemployment and 16% joblessness for white workers.

Overrepresentation in Jobless Claims: Asian Americans accounted for 16% of California’s workforce before shutdowns but made up 19% of initial unemployment claims. In New York, despite making up 9% of the workforce, they filed 14% of claims by mid-April.

Severe Impact on Low-Income Workers: Disadvantaged workers bore the brunt of the downturn—83% of Asian American labor force members with a high school education or less filed unemployment claims in California, compared to 37% for non-Asian workers with equivalent education levels.

Concentration in Vulnerable Sectors: Nearly 1 in 4 Asian American workers are concentrated in hospitality, retail, and personal services. In April 2020, Asian American unemployment reached 39% in hospitality and 40% in personal services/repair shops.

Small Business Closures: Between February and April 2020, an estimated 233,000 Asian American small businesses closed — a 28% drop — compared to a 17% decline among white-owned small businesses.

View from the edge

Streets in San Francisco's Chinatown were
empty during the COVID pandemic.

Since the worse of the pandemic appears to be over, the Asian American community is still struggling to overcome the financial and societal hurdles that came about because of the pandemic and the current anti-Asian sentiment fueled by Donald Trump's anti-Asian rhetoric and harsh immigration policy targeting a wide specturm of immigrants and uS citizens.

Lead researcher Ong noted that rising anti-Asian sentiment could worsen these  disparities as the still-struggling economy reopens amid questionable federal trade, economic policies and federal assistance cuts.

Among the report's recommendations:

• Enact federal policy to extend unemployment benefits and small business assistance, such as the Paycheck Protection Program and the Economic Injury Disaster Loan assistance program from the U.S. Small Business Administration.

• Enact additional state policies that provide benefits to marginalized populations least likely to receive unemployment benefits through the CARES Act.

• Enact additional policies to assist small businesses, including the so-called resiliency funds established by some local governments.

• Increase efforts to ensure marginalized populations take advantage of governmental, private and philanthropic resources to help people weather the financial hardships of COVID-19.

• Enact federal and state polices and fund programs to equip economically displaced people with job skills that are marketable during and after the COVID-19 crisis.

According to reports from organizations like National Nurses United, during the height of the pandemic, roughly 1 in 3 registered nurse fatalities from COVID-19 were of Filipino origin. That dramatic figure symbolizes the extent of the pandmic's impact beyond the hospital wards into the businesses and homes of the AANHPI communities.

“We need to invest in all workers to ensure a robust recovery,” the researchers write.

To prevent long-term economic damage, the report's authors urge federal and state lawmakers to extend emergency unemployment benefits, fund local small business resiliency grants, and expand job retraining programs targeting economically displaced service workers.

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