Higher rates of immigration and higher-than-average incomes were key factors in the rise of Asian Americans’ economic strength, according to findings recently highlighted in a series of Nielsen 2020 consumer reports on levels of disposable income among Black, Latinx and Asian Americans.
The analytics company estimates that prior to the pandemic, the total buying power of Black Americans was on track to reach $1.8 trillion by 2024. Latinx buying power was projected to reach $2.3 trillion by the same year.
Nielsen defines buying power as the collective disposable income a group has after taxes.
The total US population grew by only 8% over the same span, according to Nielsen. The population of non-Hispanic Whites declined by 1% during that time. The Asian-American population is expected to increase an additional 21% by 2025, according to US Census data cited by Nielsen.
“Asian Americans represent the fastest growing ethnic group in America,” NielsenIQ global marketing vice president Mariko Carpenter told CNN Business during a pair of recent interviews. “Population-wise, we almost doubled.”
Nielsen’s research also shows Asian Americans are overrepresented in high-earning science, technology, engineering and mathematics related fields.
“We have 23% of the working population of Asian-American professionals that work in STEM,” Carpenter said. “You have 12% in some of the medical fields. We tend to also be in professions that are high income, which contributes to the buying power.”
But Asian Americans are also the demographic group that has the biggest disparity in wealth, according to Carpenter and the Asian/Pacific Islander American Chamber of Commerce and Entrepreneurship. The group’s president, Susan Allen, said it remains unclear how much damage the Covid-19 pandemic has done to Asian Americans’ collective buying power.
“Many Asian businesses have really gone down badly,” Allen told CNN Business. “Those who are owning the restaurants, retail stores, nail salons and the very basic community-based businesses, they are the ones who have suffered greatly.”
Nielsen’s report said the rise in Asian-American buying power and their outsize influence on US consumer behavior through online gaming communities and social media make the demographic group an ideal target for marketers looking to maximize results for their advertising and publicity campaigns.
“Asian Americans are 21% more likely to use social media to support companies and brands,” Carpenter told CNN Business. “We are pace setters when it comes to technology, adoption and really shaping brands.”