The estimates reported in the 2010 American Community Survey revealed that the median salaried household income of India-born immigrants was around $94,700. In comparison, the median household income of native-born Americans was estimated at $51,750. Unlike the Pakistan-born immigrants in Canada, who lagged behind others in economic prosperity, Pakistanis in America are relatively thriving where the median household income of Pakistan-born immigrants is 18 per cent higher than that of the native-born Americans.
The American Community Survey for 2010 (latest data available from the US Census Bureau) reveal that amongst South Asians living in the US, India-born immigrants are far ahead of Pakistanis, Bangladeshis, and Afghanis. Even when compared with immigrants from Egypt, a country known for supplying highly educated immigrants to the US, Indians report exceptionally higher indicators of economic progress.
Indian-born immigrants also reported one of the lowest poverty rates at 4 per cent. Afghanistan-born immigrants reported the highest poverty rate where one in five Afghan immigrants was deemed below the poverty line in the US. While Pakistan-born immigrants reported higher median household incomes than the native-born Americans, surprisingly 14 per cent of the Pakistan-born immigrants were below the poverty line compared to only 9.4 per cent of the native-born Americans.
Another indicator of financial distress amongst households in North America is the percentage of household income spent on gross rent. Households spending 30 per cent or more of household income on rent are considered financially distressed. Amongst households who live in rental units, 57 per cent of the immigrants from Pakistan, Bangladesh, and Egypt spent more than 30 per cent of the household income on rent compared to only 24 per cent of immigrants from India.
These poverty statistics raise several questions. For instance, despite having similar South Asian heritage, Pakistan-born immigrants report a 2.4-times higher rate of poverty than their Indian counterparts. Furthermore, poverty among younger cohorts (18 years old or younger) is even worse amongst immigrants from Pakistan than from India. At the same time almost 50 per cent of under-18 Afghan immigrants are reportedly below the poverty line in the US. These statistics necessitate the need to explore the reasons behind disparities amongst immigrants from South Asia.
I am presenting here a socio-economic comparison of South Asians in the US. I have restricted the reporting to immigrants from India, Pakistan, Bangladesh, and Afghanistan. This is done because India, Pakistan, Bangladesh, and to some extent Afghanistan have more in common in culture and recent history than other countries in South Asia. I have thrown in Egypt for good measure to serve as a control for immigrants from another Muslim country with a different cultural background.
The purpose of this comparative review is to determine what are the reasons behind the success of India-born immigrants in the US. Could it be that the immigrants from India had luck on their side, or could it be that Indian immigrants possessed the necessary ingredients to succeed in the highly competitive labour market in the United States. More importantly, one needs to explore why immigrants from Pakistan and Bangladesh lag behind those from India in achieving the same levels of economic success.
Sizing the South Asians:
With approximately 1.8 million individuals, India-born immigrants form the largest cohort amongst South Asians in the US. The American Community Survey (ACS) in 2010 estimated Pakistan-born immigrants at 300,000, Bangladesh-born immigrants at 153,000, and Afghanistan-born immigrants at 60,000. Egypt-born immigrants totalled 133,000. Immigrants from India were approximately five-times the size of Pakistan-born immigrants. The relatively large size of Indian immigrants leads to larger social networks, which help with searching for better employment prospects.
Despite their large size, most India-born immigrants in the US are recent arrivals. Whereas 47 per cent of the India-born immigrants arrived in the US after 2000, only 36 per cent of the Pakistan-born immigrants arrived after 2000. This suggests that the economic success of immigrants from India is driven by the recent arrivals. Relatively speaking, immigrants from Afghanistan have enjoyed the longest tenure in the US of all South Asian countries discussed here. Notice that while 42 per cent of immigrants from Afghanistan arrived in the US before 1980, only 25 per cent of the Indian immigrants accomplished the same.
Pakistanis have larger families:
With 4.3 persons per households, immigrants from Pakistan and Afghanistan reported significantly larger family sizes. In comparison, the native-born population reported a household size of 2.6 persons whereas the size of India-born immigrant households was around 3.5 persons. The difference between immigrants from India and other South Asians is more pronounced when one looks at the per capita earnings. Owing to their smaller household size, immigrants from India reported significantly higher per capita incomes than the rest. For instance, Bangladesh-born immigrants reported 50% less in median per capita income than those from India. And while immigrants from Pakistan reported higher household incomes than the immigrants from Egypt, the larger household size of Pakistan-born immigrants brought their per capita incomes lower than that of Egyptians.