This study presents a comprehensive analysis of the contribution made by Latino Americans to the US economy, based on data from a wide variety of government and private sources. The findings are striking: To an extent few appreciate, the US Latino population is growing, young, increasingly educated, employed, connected, entrepreneurial, and upwardly mobile in terms of income as well as consumption.
Consider the following:
- While much of the developed world is facing stagnant population growth and an increasingly elderly age distribution, growth in the Latino population is keeping America both young and growing. Between 1990 and 2015, the Latino population grew from 22 million to 57 million, roughly five times as fast as the population overall. To illustrate this rapid growth, consider that if the Latino population had grown at the same rate as the rest of the US, there would be 30 million fewer Americans today.
- At 28 years old, the median Latino is nine years younger than the population at large and 15 years younger than the median white. Millenials make up 26 percent of the Hispanic population, compared to 22 percent for the US population. Economic research suggests that the youthful demographic profile of the Latino population enhances productivity and increases growth in per capita incomes.
- Latinos are responsible for 29 percent of the growth in real income since 2005. They account for roughly 10 cents of every dollar of US national income, and that proportion is rising both due to growth in the Latino population and rising per capita earnings.
- Latinos play a critical role in the labor force, both as employees and, especially, as job creators and entrepreneurs. They are more likely to participate in the labor force (65.9 percent vs. 62.7 percent) and to be employed (61.6 percent vs. 59.3 percent) than the overall US population. While Latinos account for 17 percent of all workers, they account for 21 percent of new entrepreneurs. Latinos accounted for nearly half—46 percent—of the growth in employment from 2011 to 2015.
- The Hispanic poverty rate is falling more rapidly than for the rest of the population: Hispanic poverty fell by 2.2 points from 2014 to 2015 (from 23.6 percent to 21.4 percent in 2015) while the national average rate fell by 1.3 points—and Hispanics are the only major ethnic group with a lower poverty rate today than in 2007.
- As consumers, Latinos wield more than $1.3 trillion in buying power, and the number of affluent Hispanic households is growing much faster than for the overall population: In 2015, there were approximately 370,000 US Latino households with incomes over $200,000, an increase of 187 percent since 2005.
- The Latino population is also becoming more geographically dispersed across the US. The final section of this study presents data on the 25 Metropolitan Statistical Areas (MSAs) with the largest Latino economies, as measured by aggregate personal income. These communities are located in every region of the US, from Atlanta to Denver, Chicago to Miami, Los Angeles to Washington, DC, and together account for more than 36 million Latinos with combined incomes of over $650 billion. Over the last decade, Latinos accounted for 22 percent of the growth in personal income in these MSAs.
The remainder of this study is organized as follows. Section II focuses on Latino demographics, including the growth and age distribution of the Latino population and characteristics, such as educational achievement and Internet connectivity. Section III presents data on the role of Latinos as workers and entreprenuers. Section IV presents data on Latino income and purchasing power. Section V focuses on the top 25 power MSAs. Section VI provides a brief summary of the findings.