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28: Economic Well-Being, Supports and Barriers

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    Learning Objectives

    • Learn from the national and global perspectives of economic well-being, supports, and barriers among immigrants and refugees.
    • Recognizing that the world is constantly and rapidly changing.
    • Recognizing that Global/national/international events can have an impact on individuals, families, groups, organizations, and communities.
    • Global implications dictate that we foster international relationships and opportunities to address international concerns, needs, problems, and actions to improve the well-being of not only U.S. citizens, but global citizens.

    28.1 Introduction

    The section was written by Veronica Deenanath (Family Social Science, University of Minnesota), Nancy Lo (Family Social Science, University of Minnesota), Dung Mao (Family Social Science, University of Minnesota), Jaime Ballard (Family Social Science, University of Minnesota), and Catherine Solheim (Family Social Science, University of Minnesota)


    The United States is a nation of immigrants who often bring dreams of opportunities and economic prosperity and a goal to build a better life than the one left behind. Immigrant and refugee families are typically starting over economically; they arrive with few or no financial resources and are unfamiliar with the financial system in the host counties. As discussed in Chapter 1, some families immigrate because they were unable to financially support their families in their home country (Solheim, Rojas-Garcia, Olson, & Zuiker, 2012; Portes & Rumbaut, 2006). Others were able to support their families but had to leave everything behind to travel to safety after conflict or natural disasters. While there are some high-income immigrants who are recruited internationally by companies, this is a minority of immigration cases (U.S. Visas, 2013). The majority of immigrants come with hopes of economic change for their families.


    Iraqi refugee children preparing for relocation
    Iraqi refugee children preparing for relocation. DFID – UK Department for International Development – Iraqi refugee children at Newroz camp – CC BY 2.0.

    Although immigrants may arrive full of hope, their path to economic well-being can be long and challenging, making their dream seem far from reality. Economic systems differ between countries and cultures, and immigrants must learn new systems of payment and saving. They must also learn how to manage their finances in a virtual world of credit, debit, and online transactions – a far cry from mostly local cash-based markets in their home countries. Additionally, job skills and education do not always transfer across countries. Immigrants who were well-qualified for jobs in another country often find themselves under-qualified after resettlement. For example, an immigrant might have been a well-qualified teacher in their home country, but cannot teach in the United States without a teacher’s license, which takes time and money to obtain. Finally, many immigrants face discrimination as they apply for jobs and as they access services such as health care.

    This chapter addresses immigrants’ and refugees’ road to achieving economic well-being. Only limited research has identified the challenges and supports available to immigrants on their economic journey; the majority of information is drawn from analysis of government reports of employment, income, housing, and healthcare usage. In this chapter, we use this research to highlight the key areas of economic well-being in immigrants and refugees, including employment, access to health care and housing, financial management skills, and access to financial products and services.

    Economic Well-Being

    Economic well-being is an individual’s ability to buy the necessities of life for themselves and their families, and have resources to pursue goals that improve their quality of life. (OECD, 2013).

    28.2 Employment

    The most critical step towards economic well-being is obtaining adequate employment. Immigrants account for more than 17% of the United States workforce, although they make up only 13% of the population (MPI, 2013). The unemployment rate for foreign-born persons is currently 5.6%, while it is 6.3% for native-born persons (Bureau of Labor Statistics, 2015). Although immigrants have relatively high rates of labor force participation, the opportunities and benefits that are available to them depend on the level of employment they can obtain. We will address each in turn.

    Low-skill labor force. Immigrants make up half of the low-skill labor force in the United States (Bureau of Labor Statistics, 2011). In 2005, it was estimated that undocumented immigrants make up 23% of the low-skill labor force (Capps, Fortuny, & Fix, 2007). Low-skilled immigrant workers tend to be overrepresented in certain industries, particularly those with lower wages. Table 1 displays the foreign-born workforce by occupation.

    Occupation Share of Foreign-Born Workers in Occupation (%) Share of Native-Born Workers in Occupation (%)
    Management, professional, and related 29.8 37.7
    Service 25.1 17
    Sales and office 17.1 25.6
    Production, transportation, and material moving 15.2 11.6
    Natural resources, construction, and maintenance 12.9 8.1

    Approximately 20% of immigrant workers are employed in construction, food service, and agriculture (Singer, 2012). More than half of all workers employed in private households are immigrants and immigrants also represent a third of the workers in the hospitality industry (Newbuger & Gryn, 2009). The majority of the positions in these industries are low-wage jobs.

    South Central Farm in Los Angeles, one of the largest urban gardens in the United States
    South Central Farm in Los Angeles, one of the largest urban gardens in the United States. Wikimedia Commons – CC BY 2.5.


    Middle- and high-skill labor force. More educated and skilled immigrant workers can obtain jobs that are high paying and offer job stability such as those in healthcare, high-technology manufacturing, information technology, and life sciences. Immigrant workers are keeping pace with the native-born workforce in these high skill industries (Singer, 2012). Immigrants hold bachelors and graduate degrees at similar rates to their native-born peers (30% and 11%, respectively; Singer, 2012).

    Barriers to better employment. The largest barriers to higher-paying employment for immigrants are a lack of education and English-speaking ability. Approximately 29% of immigrant workers do not hold a high school diploma compared to only 7% of their native-born peers (Singer, 2012). Moreover, about 46% of immigrant workers would classify themselves as limited English proficient speakers (Capps, Fix, Passel, Ost, & Perez-Lopez, 2003). More than 62% of immigrant workers in low-wage jobs are limited English language speakers compared to only 2% of native-born workers in low-wage jobs (Capps, Fix, Passel, Ost, & Perez-Lopez, 2003). A study conducted by the Robert Wood Johnson Foundation (Garrett, 2006) found that it is extremely difficult for refugees to move from low-paying to better paying jobs after they have adjusted to living in the United States because many lack English language skills and education. It is difficult for immigrants to seek more education or training, due to the pressing need to work to provide for their families. Leaving the workforce to train may leave them financially vulnerable.

    Immigrant workers who are middle-wage earners are still disadvantaged. In comparison to their native-born peers who earn a median income of $820 weekly, a full-time salary immigrant worker earns $664 weekly (Bureau of Labor Statistics, 2015). Moreover, these workers earn 12% less in hourly wage than their native-born counterparts; this wage gap is 26% in California, a state with the largest immigrant workforce (immigrants make up 37% of the workforce in California; Bohn & Schiff, 2011).

    These wage disadvantages are partially due to employer discrimination. In 1996, the Illegal Immigration Reform and Immigrant Responsibility Act (IRCA) implemented additional restrictions on employment eligibility verification, including sanctions for employers who hired undocumented immigrants. Although it is illegal for an employer to discriminate based on national origin or citizenship status, many employers chose to avoid hiring individuals who appeared foreign, in order to avoid sanctions. A General Accounting Office survey found that 19% of employers (approximately 891,000 employers) admitted to discriminating against people based on language, accent, appearance, or citizenship status because of fear of violating IRCA.

    Immigrant workers also face high rates of wage and workplace violations. A study looking at workplace violations in three large metropolitan cities in the United States (Chicago, Los Angeles, and New York City) found that immigrant workers were twice as likely to experience a minimum wage violation than their native-born peers (Bernhardt et al., 2008). Another study conducted by Orrenius and Zavodny (2009) also found that immigrants are more likely to be employed in dangerous industries than their native-born peers, and experience more workplace injuries and fatalities. In these injuries, limited English skills are a contributing factor. These workers may be afraid to speak for themselves with their livelihood at stake and are left at the mercy of others. Immigrant workers are in dire need of representation, but infrequently have access to it. Only 10% of the immigrant workforce is represented by unions in contrast to 14 percent of the native-born workforce (Batalova, 2011).

    Supports for Employment: The Unique Case of Refugees

    Refugees are a unique group of immigrants in that there are support systems in place to help with resettlement upon their arrival in the United States. Government agencies and voluntary agencies (VOLAGs) provide initial supports to help families resettle in their new home, including social services, food support, cash assistance, healthcare, and employment services. Great emphasis in the refugee resettlement process is placed on finding a job so that refugees can become financially self-sufficient without the support of the government. The Office of Refugee Resettlement (ORR) provides two programs to support VOLAGs in finding employment contracts for refugees:

    • Early Employment Services: In this program, ORR provides funding for a staff member(s) to act as an employment specialist to prepare the refugees for work and for finding employment. VOLAGs are given anywhere from 18-24 months to help refugees secure jobs through the Early Employment Services program (Darrow, 2015); the time period varies by state.
    • Voluntary Agency Matching Grant (VAMG): This is a selective and expedited employment program. The goal of this program is to help refugees attain economic self-sufficiency within the first four-six months upon arrival in the U.S. while declining public cash assistance (Office of Refugee Resettlement, 2016). Refugees selected for the VAMC program receive more intense job services and individual case management for six months and receive more generous cash and housing assistance for four months in comparison to those who are part of the Early Employment Services program. VAMC refugees are not eligible for any form of public assistance until one month after the program ends.

    Short-Term Benefit, Long-Term Drain?

    Problems in the VAMC program

    The VAMC provides extra training and benefits for refugees, with the goal of economic self-sufficiency within the first few months of arrival. However, recent research suggests there are downsides. Funding for VOLAGs in the VAMC program in contingent upon meeting performance measures such as how many refugees entered employment and how many were self-sufficient at 120 and 180 days (Office of Refugee Resettlement, 2016).
    Many of the jobs that are available quickly pay only $8.25 hourly and require over an hour in travel time. Earlier employment means less time for job training and English language classes, which are factors that would impact the long-term economic well-being of refugees.


    Ruben Parra-Cardona, Ph.D., LMFT discusses his frustration with historical amnesia surrounding the economic contributions of Latino immigrants in the United States (3:39-6:09).

    Sunny Chanthanouvong, Executive Director, Lao Assistance Center of Minnesota, discusses financial challenges among elders in the Lao community (0:00-2:21).

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    28.3 Access to Necessities

    Immigrants face barriers in their access to adequate income, particularly because they tend to be employed in low-skill jobs and face discrimination in their work environments. Poverty rates of children of immigrants are 50% higher than children of native-born citizens (Van Hook, 2003). This limits their access to adequate housing, food, and healthcare.

    Housing and Food

    Access to shelter and food are basic life necessities. Immigration has a positive impact on the rent and housing values for their communities, but immigrants themselves face barriers to accessing adequate housing. When immigrants enter a new area, rent and housing values in that area increase (Saiz, 2007). In metropolitan areas, immigrant inflow of 1% of the city’s population is tied to increases in housing values of 1% (Saiz, 2007). Despite this benefit to the community at large, immigrants are face barriers to achieving safe and affordable housing. They are less likely than native-born individuals to own a home and are more likely to live in overcrowded conditions (as measured by the number of people per room; Painter & Yu, 2010). Immigrant homeownership increases and overcrowding decreases the longer the immigrant lives in the United States. However, they still lag behind native-born citizens in homeownership and overcrowding even after living in the United States for 20 years (Painter & Yu, 2010).

    Housing conditions are influenced by the immigrant’s documentation status and English language abilities. Immigrants who spent some time without documentation are less likely than documented immigrants to own a home, even if they now have documentation (McConnell & Akresh, 2008). Documentation likely influences access to high-paying jobs and to home loans. Similarly, English proficiency increases the chances of an individual becoming a home-owner, because English proficiency increases the ability to access labor and credit markets (Painter & Yu, 2010).

    New York Tenement Museum

    In the 19th and 20th centuries, a 350 square foot apartment here housed six recent immigrants
    In the 19th and 20th centuries, a 350 square foot apartment here housed six recent immigrants. Michael Sean Gallagher – 94 Orchard Street, Lower East Side, New York – CC BY-SA 2.0.


    Additionally, housing access is influenced by discriminatory practices. In the United States 42 cities and counties have passed anti-illegal immigration laws that prohibit landlords from allowing undocumented immigrants to use or rent their property (Oliveri, 2009).
    Although the Federal Fair Housing Act prohibits discrimination on the basis of national origin (110. 42 U.S.C. §§ 3601-3619, 3631), it is easier for these landlords to discriminate against prospective tenants who appear foreign than to process the immigration status of every prospective tenant (Oliveri, 2009). Due to these discriminatory practices, immigrants’ housing options becomes even more limited.

    Immigrant households are at a substantially higher risk of food insecurity, or a lack of adequate food for everyone in the household, than native-born households (Chilton, 2009). Newly arrived immigrants face the greatest risk (Chilton, 2009), perhaps due to a lack of English skills or education. This lack of access to adequate food has significant consequences: household food insecurity significantly increases the risk of children in the household having only fair or poor health (Chilton, 2009). It can be difficult for immigrant families to access food-related resources. Among families that have trouble paying for food, those headed by immigrants are less likely than families headed by native-born individuals to receive food stamps (Reardon-Anderson, Capps, & Fix, 2002). Those who do receive food assistance through food shelves may find that the food offered is unfamiliar.


    Although immigrants have high rates of labor force participation, they are less likely than native-born peers to have health insurance (Derose, Bahney, Lurie, & Escarce, 2009). There are few services in the United States that are as crucial and complex as the healthcare system, which continues to be a major indicator of socio-economic success. A person’s inability to access and utilize healthcare services gives a strong indication of critical unmet needs and barriers that impede the ability of successful integration and participation in society. Immigrants face substantial barriers to healthcare access, including restricted access to government based healthcare services, language difficulties, and cultural differences.

    Air Force doctor provides services through an interpreter
    Air Force doctor provides services through an interpreter. Wikimedia Commons – public domain.

    Reduced Use of Healthcare. Total health care expenditures are lower for immigrant adults than for their native-born peers (Derose, Bahney, Lurie, & Escarce, 2009). Additionally, immigrants are less likely to report a regular source or provider for health care, and report lower health care use than native-born peers (Derose, Bahney, Lurie, & Escarce, 2009). This means that overall, immigrants have less access to healthcare and less healthcare use than do most native-born individuals.

    Undocumented immigrants have particularly low rates of health insurance and health care use (Ortega et al., 2007). Undocumented Latinos/as have fewer physician visits annually than native born Latinos/as (Ortega et al., 2007). Undocumented immigrants are more likely than documented immigrants or native-born individuals to state that they have difficulty understanding their physicians or think they would get better care if they were a different race or ethnicity. Despite their low rates of use, immigrants are in need of healthcare. Children of immigrants are also more than twice as likely as children of natives to be in “fair” or “poor” health (Reardon-Anderson, Capps, & Fix, 2002).

    Legal Status Restricts Healthcare Benefit Eligibility. Immigration status is an important legal criterion that may hinder access to healthcare benefits. The Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA), established in 1996, restricted Medicaid eligibility of immigrants. Immigrants cannot receive coverage, except in cases of medical emergencies, during their first five years in the country. States can choose to grant aid out of their own funds, but no federal welfare funds may be used for immigrant health care. The reform also stated that the eligibility of an immigrant for public services would be dependent on the income of the immigrant’s sponsor, who could be held financially liable for public benefits used by the immigrant. Finally, the Act required that states or local governments who fund benefits for undocumented immigrants take steps to identify their eligibility (Derose, Escarce, & Lurie, 2007). Hence, health benefits and insurance for most immigrants are highly dependent on eligibility through employment.

    Immigrant Contributions to Medicare

    Immigrants contribute substantial amounts to Medicare. In fact, immigrants contribute billions more to Medicare through payroll taxes than they use in medical services (Zallman, Woolhandler, Himmelstein, Bor & McCormick, 2013). Undocumented immigrants contribute more than 12 billion dollars annually to Social Security and Medicare through taxes under borrowed social security numbers, yet are ineligible for benefits through these systems (Goss et al., 2013).

    The Affordable Care Act (ACA; Pub. Law No. 111-148 and 111-152), established in 2010, updated some of these policies. This act ensured that legal permanent residents with incomes up to 400 percent below the federal poverty level could qualify for subsidized health care coverage. Medicaid and other health benefits still require a 5-year waiting period, however, states have the option to remove the 5-year waiting period and cover lawfully residing children and/or pregnant women in Medicaid or Children’s Health Insurance Program (CHIP). Undocumented immigrants receive no federal support under the ACA. Under the ACA, refugees who are admitted to the United States and meet the immigration status eligibility have immediate access to Medicaid, CHIP and health coverage options.

    Language Difficulties. Language difficulties, including limited English language proficiency and poor English literacy skills, are one of the most formidable barriers for immigrant access to healthcare. Language ability affects all levels of accessing the healthcare system, including making appointments, filling out of paperwork, the ability to locate healthcare facilities, direct communication with healthcare professionals, understanding written materials, filling out prescriptions, understanding of treatment options and general decision making. Among children, for example, those from non-English primary language households were four times as likely to lack health insurance and twice as likely to lack access to a medical home (Yu & Singh, 2009). Similarly, Spanish-speaking Latinos/as were twice as likely as English-speaking Latinos/as to be uninsured, and twice as likely to be without a personal doctor, and received less preventative care (DuBard & Gizlice, 2008).

    These difficulties impede the facilitation of patient autonomy in making healthcare decisions. This is especially relevant in the transmission of complicated medical jargon and limits in-depth conversations about treatment options between the healthcare provider and immigrant patients. Patients with language-discordant providers receive less health education that patients with a provider or interpreter who speaks their language (Ngo-Metzger et al., 2007). Among Hispanics, for example, those who speak a language other than English at home are less likely to receive all the health care services for which they are eligible (Cheng, Chen, & Cunningham, 2007).

    In some cases, miscommunication and misinterpretation can have significant consequences. At times, if an immigrant can communicate in English, providers may assume that the level of understanding of the immigrant patient is higher than what the immigrant patient can actually understand (Flores, 2006). This causes misinterpretations and miscommunications that leave immigrants feeling frustrated, which may result in the avoidance of healthcare use unless it is critical.

    To overcome the language gap, immigrants often utilize friends and family members as interpreters in medical settings (Diamond, Wilson-Stronks, & Jacobs, 2010). Children in immigrant families often speak, read and understand English better than their parents do and, as such, are often burdened with the duty of being the family translator and interpreter when dealing with the healthcare system (Kim & Keefe, 2010). This role reversal may cause conflicts within the family, as the child must take on the responsibility of communicating complex and difficult information. Additionally, the utilization of family and friends as interpreters is often ineffective as family and friends may not be accurately able to translate complex medical information and ensure accurate understanding of complex medical language, treatments, interventions or outcomes that are necessary in healthcare decision making (Flores, 2006). The use of family members, friends or even community members as interpreters also has great concerns in the ensuring of confidentiality of sensitive health information of immigrant patients, as they are not trained in appropriate confidentiality procedures.

    Health care centers that offer professional interpreters or who have multi-lingual medical providers can greatly alleviate these stressors. The Civil Rights Act of 1964 requires that medical providers receiving federal funds provide language services for clients with limited English, and many states have similar guidelines (Jacobs, Chen, Karliner, Agger-Gapta, & Mutha, 2006). However, resource allocation is a significant issue in the actual implementation of interpreter services in healthcare facilities. Many healthcare providers find it difficult to provide adequate language services, as they may be understaffed, underfunded, and often unable to provide service due to other demands of the job (Morris et al., 2009). For example, though hospitals inform clients of their right to receive language services, many do so only in English (Diamond, Wilson-Stronks, & Jacobs, 2010). The majority of hospitals report providing language assistance in a timely manner only in the most commonly requested language (the most commonly requested languages varied by hospital area, but most frequently included Spanish, American Sign Language, and Vietnamese) (Diamond, Wilson-Stronks, & Jacobs, 2010). There is also a lack of minority and multilingual health professionals in the field. Most immigrants will choose to use healthcare resources in their native language or providers who are representative of their native culture, even at the cost of quality (Morris et al., 2009). In order to provide immigrants with effective healthcare services, great consideration and support must be made to ensure the diversification of the healthcare workforce. This can be achieved through the provision of educational and vocational pathways for minority students to enter academic programs and health care careers (Fernandez-Pena, 2012). The efforts to improve linguistically relevant health services is important as it increases provider cultural competence, cultural humility and language access for immigrants.

    Culture. Culture is an important aspect to consider in healthcare access for immigrants as it determines the perceptions and values placed on systems and providers, willingness to utilize these services and ability to successfully navigate the system.

    • Culture influences our ideas of when healthcare is needed. For some immigrants, the idea of preventative care, such as annual medical, vision, and dental exams are not normative. This may be due to lack of economic circumstances in the country or origin where healthcare was inaccessible to the majority of the population or only utilized in times of extreme need such as serious health issues or emergencies. For example, Vietnamese generally do not recognize the concept of preventative medicine, and will not seek treatment unless symptoms are present and will sometimes discontinue medication when symptoms abate (CDC, 2008a).
    • Culture influences our definitions of healthcare. Many immigrants may place a higher value in homeopathic treatment and spiritual healers. This was noted especially in Latino immigrants where a strong belief in faith-based and alternative healing practices lead the usage of religious organizations for help in mental disorders. For example, recent Latina immigrants reported using alternative or complementary medicine first and then sought medical help only if these methods were ineffective (Garces, Scarinci, & Harrison, 2006).


    Koguis shaman in Columbia
    Koguis shaman in Colombia. Wikimedia Commons – CC BY-SA 3.0.
    • The Hmong traditionally view illness as the result of a curse, violation of taboos, or a soul separating from its body, in addition to natural causes such as infectious disease (CDC, 2014). These values are contrary to Eurocentric models, which are predominant in the United States healthcare systems (Rastogi, Massey-Hastings, & Wieling, 2012).
    • Culture influences our expectations of healthcare effectiveness. In some cultures, a healthcare professional is expected to cure the illness versus manage it. A strong expectation is then placed in immediate improvement of illness after meeting or seeing healthcare providers. This unmet expectation can cause a great sense of disappointment for immigrants and increase their reluctance in using healthcare services.
    • Cultural norms restrict interactions between genders. In some cases cultural and religious values impose strict regulations on gender roles and expectations which affects with whom an immigrant can interact and under what circumstances. For example, Somali individuals following an Islamic tradition that men and women should not touch (CDC, 2008b), which may lead to strong preferences for female immigrants to see female practitioners and male immigrants to see male practitioners. This could limit access to care. It adds unique challenges for healthcare practitioners to communicate across genders effectively and provide comfortable and respectful services for their immigrant patients.
    • Culture influences the stigma of health issues. Cultural values and beliefs have a strong impact on the perceptions of certain health issues or diseases. Among the Somali, for example, there is a strong stigma against those who have tuberculosis (CDC, 2008b). Individuals avoid talking about having tuberculosis or seeking treatment, in order to avoid stigma (CDC, 2008b). In other cultures, mental illness may suggest that an individual has a weak will or personality. Individuals feel shame and work to hide these issues rather than seeking help. There is a great need for more culturally and linguistically appropriate health services (Diamond, Wilson-Stronks, & Jacobs, 2010; Shannon, McCleary, Wieling, Im, Becher, & O’Fallon, 2015).

    Access to Supports

    The Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA) restricts access to food stamps, Medicaid, and housing assistance for most non-citizens with less than 5 years of United States residency (Van Hook & Balisteri, 2006). States, however, can decide to offer assistance for immigrants.

    Many children of immigrants are native-born citizens, and consequently are eligible for public benefits including food stamps, housing assistance and health insurance. However, many immigrant parents fear that attempts to access these benefits may interfere with their process of becoming citizens or may result in deportation and separation of parents and other families’ members who are undocumented (Perreira et al., 2012).

    Child welfare systems need to be prepared to respond to the numerous challenges of immigrant children and families who come to the attention of the system. Child welfare has largely been unaware of these challenges and response to cases with this particular group may be slow or impeded. This heralds the need for the development of tools, approaches, practices and policy improvements within the child welfare system to effectively address the needs of immigrant children and their families.

    28.4 Financial Problems

    When immigrants come to the United States, they frequently must learn how to navigate new financial systems. Some immigrants come from countries where banks are both trusted and common, some have only experienced weak or corrupt banks, and others have interacted primarily with cash-based markets. They must learn to navigate new financial institutions and products.

    Immigrants face unique barriers to accessing financial institutions and products. First, immigrants whose native countries have weak or corrupt financial instructions may distrust banks. Immigrants from countries with weak financial institutions (those that do not effectively protect private property or offer incentives for investment) are less likely to participate in United States financial markets (Osili & Paulson, 2008). Additionally, immigrants may face language and cultural barriers in accessing financial products. Banks may not have employees who speak the immigrant’s native language or who are familiar with specific cultural customs surrounding finances.


    One of the first steps to establishing financial security is the ability to utilize financial products and services available to both protect and increase one’s assets. The most important and basic of these financial tools are checking and savings accounts. Having checking and savings accounts allow individuals to keep their money safe, dramatically reduce the fees associated with financial transactions (e.g., cashing paychecks), efficiently and safely pay bills and other obligations, and establish creditworthiness (Rhine & Greene, 2006).

    Immigrants are much more likely than native-born peers to be “unbanked,” or have no bank accounts of any kind. The incidence of being unbanked in immigrant communities is 13% higher than the native-born population (Bohn & Pearlman, 2013). Among immigrant communities in New York, as much as 57% of Mexican immigrants and 35% of Ecuadorian were unbanked (Department of Consumer Affairs, 2013). Immigrants who create bank accounts are able to access financial benefits. For example, immigrants with bank accounts in the United States are more likely to own than to rent or live for free, suggesting that this is an important correlate of homeownership (McConnell & Akresh, 2008).

    Research investigating the differences between banked and unbanked immigrants found unbaked immigrants tended to live in enclaves (Bohn & Pearlman, 2013), arrived in the United States at a later age, and have less education, lower English proficiency, lower-income level, and larger families (Paulson, Singer, Newberger, & Smith, 2006; Rhine & Greene, 2006). Immigrants who are unsure about the length of stay in the United States also more likely to be unbanked (Department of Consumer Affairs, 2013). Furthermore, those who are unbanked, experience more structural barriers such as understanding the banking system, documents, and process. Having direct, physical control over cash rather than keeping it in a bank was found to deter Hispanic consumers from using financial products and services (Federal Reserve Bank of Kansas City, 2010).


    Immigrants are less likely than native-born citizens to have a savings account, even after accounting for socioeconomic status (Paulson, Singer, Newberger, & Smith, 2006). However, many immigrants are saving money, using both savings accounts and less formal methods. In a study of Southeast Asian refugees in Canada, Johnson (1999) found that 80% of the participants were saving money. A study of later-age, low-income Asian immigrants in the United States found much lower rates; only 15% saved regularly (Nam, Lee, Huang, & Kim, 2015). The most common reasons quoted for saving money include emergencies (Johnson, 1999; Solheim & Yang, 2010), children’s education, and home purchases (Johnson, 1999).


    Immigrants who are more acculturated tend to be more open to using credit cards. Likewise, individuals who are younger, employed, higher-income, and have greater English proficiency are more likely to use credit cards (Johnson, 2007; Solheim & Yang, 2010). The reasons for using credit cards range from everyday purchases (e.g. eating out, buying clothes, buying furniture or appliances, etc.) (Johnson, 2007), to emergencies (Johnson, 2007; Solheim & Yang, 2010), to building credit (Solheim & Yang, 2010). It is worthwhile to note that although individuals that are less acculturated (e.g. first-generation Hmong parents) tended to prefer to use cash for purchases rather than credit card, these individuals also recognized the importance of building credit. This recognition motivates older, less acculturated individuals to use credit cards (Solheim & Yang, 2010).


    Remittances are money sent by migrants to spouses, children, parents, or other relatives in their country of origin. These funds are typically sent through money transfer agencies (e.g. MoneyGram, Western Union) for a fee, through banks, or via friends or relatives visiting the country of origin. According to the World Bank, in 2013 international migrants sent $404 billion in remittances to their counties of origin (Tuck-Primdahl & Chand, 2014). Approximately a quarter of these funds originated from the United States. The top four countries to receive funds were India ($70 billion), China ($60 billion), the Philippines ($25 billion), and Mexico ($22 billion).

    Remittances have a significant impact on both individuals and families. Remittances make it possible to meet basic needs such as purchasing food and clothing and paying for rent and utilities. Furthermore, remittances allow families to pay down (or pay off) debt as well as provide family members access to healthcare (Solheim, Rojas-Garcia, Olson, & Zuiker, 2012).

    For immigrants in the United States, the obligation to send money home can create stress and hardship. The urgent need for financial support adds pressure to gain employment. It can be difficult to make enough money to meet the individual’s personal financial obligations (e.g. pay for rent, food, utilities, etc.) and to send money home. In some cases, the need to take care of the financial obligations associated with the trip to the new country (e.g. paying back borrowed money needed to for shelter and food upon first arrival) drains the finance so much that it is difficult to send money home (Martone, Munoz, Lahey, Yonder, & Gurewitz, 2011). For many immigrants, the knowledge that one is contributing to the improved living standard of one’s family makes the hardship worthwhile.

    Culturally Appropriate Services

    In order to meet the financial needs of immigrants, some community-based organizations are offering financial services that are culturally tailored. In research among Asian Americans, receiving financial services from other Asian Americans led to better financial outcomes; the clients were more likely to obtain loans and to save more and longer (Zonta, 2004). This may be because there is greater trust and fewer language barriers (Zonta, 2004). Culturally competent financial service providers can frame their materials and products in appropriate ways. For example, one bank offered loan counseling tailored to Vietnamese clients. To deal with clients’ fears of losing face over taking out a loan, the loan counselors stressed that their information and application was confidential and would not be shared with anyone in the community. The counselors also explained why they needed information, saying that the institution needed to vouch for the client in front of their loan committee (Patraporn, Pfeiffer, & Ong, 2010). Such adaptations can increase accessibility and usability of financial services for immigrants.


    Sunny Chanthanouvong, Executive Director, Lao Assistance Center of Minnesota, discusses financial and economic issues in the Lao community.

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    A YouTube element has been excluded from this version of the text. You can view it online here:

    28.5 Future Directions

    Immigrants face significant and complex challenges in achieving economic well-being. Legislation such as the PRWORA and IRCA currently limit immigrants’ access to employment, housing, and health services. The implementation of these restrictive policies is often fueled by misconceptions of the economic impact of immigrants in the greater society, especially the perception that undocumented immigrants place an economic burden on our health care system. Federal policies that facilitate more effective access to employment, housing, and healthcare and financial services are needed.

    Healthcare and financial systems can improve the provision of culturally and linguistically appropriate services for immigrants. This can be supported by the diversification of professionals in these industries through the promotion of minority individuals in financial and medical careers, the promotion of interpretation services in healthcare facilities and financial institutions, and the recruitment and training of culturally sensitive staff.

    Research is needed to more deeply understand the values, needs, and stressors in immigrant and refugee families as they transition to a new economic environment. Worry about supporting their families creates stress which can led to mental health issues. We need to understand the connections between financial worry and mental health in these families and find ways to support them.

    Research has shown financial education and interventions that are timely and relevant are the most effective. For immigrant and refugee families, what does that support entail, and at what critical transition points is it best provided? For example, in refugee resettlement, the transition from reliance on initial government assistance to reliance on earned wages is a major shift. When would an intervention have the most impact and what support do they need at that time?

    It is important to understand the strengths that immigrant and refugee families bring to these tasks, particularly the strategies they’ve learned over time that have helped them to survive in harsh living situations. We can build on those strengths and honor their root culture values from their root cultures as we create culturally-appropriate education and intervention programs.

    28.6 End-of-Chapter Summary

    Case Study

    Seng Xiong grew up in Laos. Like many Hmong in Laos, his parents were nomadic farmers. Their only bills were to purchase food or clothing, and they paid for these goods with cash or traded goods for them. Seng watched his parents keep their money safe by storing it in silver bars under their mattress. They took this money out only to pay the bride price when he married Bao.

    Seng and Bao expected to be farmers as well, but they became increasingly threatened by persecution from the Lao government. Their focus was on day-to-day survival, never on saving for the future. Ultimately, they decided to flee to a refugee camp in Thailand. While there, they were not allowed to hold formal employment, but they volunteered to work in exchange for food and small goods. Seng and Bao had three children while in the refugee camp, and they hoped for a better life for these children. They decided to move to the United States.

    When they arrived in the United States, Seng and Bao had only limited English skills. Bao was able to get work as a personal care attendant, and Seng began working in a meatpacking factory. Each job paid very little. It was very important to Seng and Bao to save for their children’s future and also to send money to their brothers and sisters still in the refugee camps. Their sponsor found them a small, two-bedroom apartment, and they furnished it with used beds, two couches, a table, and a TV. Neither job provided any health care benefits. When anyone in the family was injured or sick, Seng and Bao would talk with the elders in their community and treat the illness as best they could on their own.

    They purchased only necessities, and set aside all other money under their mattress or shipped it to their families in Laos. Neither Seng nor Bao had any experience tracking money or budgeting for things in the future; they simply spent little and tried to save or share the rest. They both distrusted banks, and preferred to use cash for all exchanges.

    As their children got older, they wanted to buy more entertainment items. It was difficult for Seng and Bao to decide what items to purchase for their children, wanting them to have a good life, and which items to say no to. Their oldest daughter started talking to them about building credit, but this seemed like a very risky situation. Bao had a friend whose identity had been stolen when she started a bank account, and Bao and Seng knew that when you borrow money from the bank, you have to pay back some interest. They knew they could borrow money from another sibling in the United States if they needed to, and having any kind of credit card or loan seemed unnecessary.

    Discussion Questions

    1. Think back on your own family history. What did you learn from your parents about banking, saving, credit, and financial obligations to family? How might that have been influenced by your cultural background?
    2. What barriers do immigrants frequently face to economic well-being?
    3. How might not having healthcare impact the well-being of an immigrant family? What about healthcare in another language?
    4. How might Seng and Bao’s financial background impact their children’s choices, particularly as their children become adults and consider college and other savings goals?

    Helpful Links

    The Culture of Money

    • This report by the Annie E. Casey Foundation, titled “The Culture of Money: The Impact of Race, Ethnicity, and Color on the Implementation of Asset-Building Strategies” describes institutional barriers low-income families navigate to become financially stable and outlines financial education strategies to support low-income families.

    The Consumer Financial Protection Board


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    Adapted from Chapters 1 through 9 from Immigrant and Refugee Families, 2nd Ed. by Jaime Ballard, Elizabeth Wieling, Catherine Solheim, and Lekie Dwanyen under the Creative Commons Attribution-NonCommercial 4.0 International License, except where otherwise noted.

    This page titled 28: Economic Well-Being, Supports and Barriers is shared under a CC BY-NC-SA license and was authored, remixed, and/or curated by Whitney Sarah Payne.

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