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As White small business owners sell their businesses in inner cities (i.e., Jews and Italians in New York in the 1980s), Asian immigrants take over in these areas. 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).In my own research on this topic, I have found that, in the same way that analyzing self-employment using the all-encompassing category of "Asian American" distorts specific differences between Asian ethnic groups, analyzing self-employment as a single type of employment can also be misleading.They also 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.Also, working in the ethnic enclaves shield owners and workers from racial hostility and discrimination that they would normally face in the mainstream labor market.
In my academic research on self-employment and entrepreneurship among Asian Americans, I have organized the different explanations of Asian immigrant self-employment into four main categories.Further, we know that the second and later generations of Asian Americans are increasing in size and as a result, helping to further integrate the Asian American community into the mainstream.As this happens, it is likely that a growing proportion of entrepreneurial activity among Asian Americans will move away from traditional "enclave" industries, and instead, will increasingly involve more businesses located in professional service industries -- industries that will allow Asian Americans to put to good use their high levels of education and occupational skills.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).
They are also likely to already have lots of financial resources to help them start their businesses.S Specifically, the summary report points out that as of 2012, there were 1.9 million Asian American-owned businesses. These Asian American-owned businesses also generated 9.4 billion in revenue (up 148% from 2002), employed more than 3.6 million people, and supported payrolls totaling 0.5 billion.They also describe how, very similar to the geography of the Asian American population in general, almost 60% of these businesses were located in just four states (California, New York, Texas, and Hawai'i) and that more than one-third are located in just four metropolitan areas (Los Angeles/Orange County, New York, Honolulu, and San Francisco).This model argues that middle and upper-class Whites business owners don't want to deal with their predominantly Black or Latino working-class customers because they fear losing money, status, or for their own personal safety.