Asian Americans and Pacific Islanders (AAPI) are the fastest-growing ethnic group in the United States, according to the U.S. Census. And they’re quickly embracing entrepreneurship. The Small Business Administration (SBA) estimates there are 2.5 million AAPI-owned small businesses in the U.S.
That’s the good news. The not-so-great news is that most AAPI business owners (92%) faced difficulties keeping their businesses open and operating amid the pandemic, according to the 2021 Asian American and Pacific Islander Business Owner Spotlight, a new study from Bank of America.
Like most small business owners, APPI entrepreneurs faced pandemic-related challenges. But this ethnic group also experienced “a surge in anti-Asian sentiment,” which 61% acknowledged impacted their mental health. Yet, despite dealing with their own stress, AAPI small business owners were concerned about the wellbeing of their employees, leading to almost 75% of them changing, or planning to change, their approach to employee wellness and benefits. Top changes include instituting a more flexible schedule (62%), remote work (50%), offering more paid time off (29%), and offering charitable matching programs or support for community involvement (25%). Plus, 41% cut their own pay to keep their employees on staff.
Fortunately, there were several resources AAPI small business owners could rely on for help, including:
- Support from friends and family (68%)
- Local government programs (58%)
- Other small business owners (55%)
- Mentors (53%)
- Their local community (52%)
- Small business bankers (51%)
Looking to the future, nearly all AAPI business owners reevaluated their company’s operations during the pandemic—and 90% say they plan to make permanent changes. Changes include:
- Enhancing sanitation practices (54%)
- Offering a product or service created in response to the pandemic (31%)
- Accepting more forms of cashless payments (30%)
- Shifting to a digital sales strategy (30%)
- Shortening their hours of operation (27%)
Like most small business owners, partially driven out of necessity, 80% of AAPI business owners adopted digital tools and strategies in response to the pandemic, including finding new ways to interact with customers (48%) and employees (35%), and implementing a digital-first marketing strategy (37%).
Asian American business owner stock photo by KimSongsak/Shutterstock