Celebrating Hispanic American Month

In Celebration of Hispanic American Month
Every day, Jose Brito Bueno does special work, providing life-improving services to thousands of seniors and people with disabilities. Through the company he founded, WeCare, some of the most vulnerable residents receive the precious in-home health care they need. This is no easy task, and central to WeCare’s ability to do this work is its staff. The vast majority of his 215 employees work as home health aides, a job that is vital yet physically taxing. Many of WeCare’s home health aides are Hispanic immigrants — hailing from countries like the Dominican Republic, Honduras, Guatemala, Nicaragua, and Mexico — who work side by side with Americans. Due to the difficulty of the job relative to pay, finding committed, caring workers is a challenge.

“Their labor is eminent. I use the word eminent because without them we couldn’t go as far as we’ve gone, because of the dedication and the care they provide,” says Brito Bueno.

Brito Bueno is himself familiar with the kind of hard work that many immigrants do when they first arrive in the United States. An immigrant from the Dominican Republic, he came to the United States at the age of 18, and within a week of arriving his father’s corner store burned down. To help rebuild, Brito Bueno worked a series of low-paying jobs and eventually put himself through college and started WeCare, seeing an opportunity to help those in need. Since its accreditation in 2009, WeCare has helped thousands of homebound Americans. Yet without his Hispanic and immigrant workers, none of it would have been possible. “I’d be in trouble,” he said.

Hispanic Americans like Brito Bueno, who are adding to the economy and improving the well-being of Americans, can be found across the United States. Taken together, the contributions of the nearly 59 million Hispanic Americans living in the United States today add up to significant economic and electoral clout.

“Hispanics live everywhere . . . and, obviously, Hispanics buy everything,” says Felipe Korzenny, founder of the Center for Hispanic Marketing Communications. For the United States, “it’s a double benefit,” he says. “Because, one, they work and produce things that other groups don’t like to, then on top of that they add to the consumption base.”

To shed more light on the economic impact of Hispanic Americans, New American Economy (NAE) looked at U.S. Census data from the 2017 American Community Survey. The data shows that Hispanic Americans earned more than $1 trillion and paid more than $250 billion in taxes in 2017 alone. Beyond that, they continue to fill critical workforce gaps in labor-short industries such as agriculture, construction, and healthcare. Hispanic Americans, and particularly Hispanic immigrants, also continue to start and own their own businesses at higher rates than the rest of the population. Hispanic eligible voters now make up considerable shares of the electorate, accounting for as much as 30 percent of eligible voters in several states.

“The Power of the Purse: The Contributions of Hispanic Americans” finds:
• In 2017, there were almost 59 million Hispanic Americans in the United States. Just over two-thirds, or 39.2 million, were U.S.-born Hispanics, while there were 19.6 million Hispanic immigrants. Combined, they made up 18.1 percent of the overall U.S. population, making them the largest non-white ethnic group in the country.

• The growth among U.S.-born Hispanics was particularly strong. U.S.-born Hispanics accounted for nearly 90 percent of growth in the Hispanic population in the United States between 2010 and 2017. The number of U.S.-born Hispanics grew by 22.8 percent, from 31.9 million to 39.2 million.

• Hispanic households hold considerable earning and consumer power. In 2017, Hispanic households earned more than $1 trillion. This allowed them to pay more than $252.2 billion in taxes, including $165.9 billion in federal income taxes, as well as $86.3 billion in state and local taxes. After taxes, Hispanic households held more than $780.7 billion in spending power.

• Today’s most recently arrived Hispanic immigrants are significantly more well educated than those who came before. While only 15.1 percent of Hispanic immigrants who had arrived between 2005 and 2010 held at least a bachelor’s degree, 28.5 of Hispanic immigrants who arrived between 2012 and 2017 did.

• Hispanic immigrants are more likely to be entrepreneurs. Almost 12 percent of all Hispanic immigrant workers worked for their own business in 2017, making them 24.5 percent more likely to have their own business than the overall U.S. population. There were a total of almost 2.3 million Hispanic entrepreneurs in the United States in 2017.

• Between 2010 and 2017 the number of eligible Hispanic voters increased by more than 7.3 million. In 2017, there were more than 28.8 million Hispanic eligible voters, a 34 percent increase from the 21.5 million Hispanic eligible voters there were in 2010. The number of U.S.-born eligible voters in particular grew from 16.1 million in 2010 to 21.7 million, an increase of more than 5.5. million people.

• Voter turnout rate is high among registered Latino voters. About 80 to 83 percent of registered Hispanics vote in presidential elections. For example, 12.7 million Hispanics, or 83 percent of registered Hispanics, voted in the 2016 presidential election, an increase of 1.5 million from 2012. About 26.7 million Hispanic Americans were of voting age, meaning 11.4 million Hispanics were eligible to vote but did not register. Meanwhile, nearly a million more Hispanics Americans turn 18 every year.

Population Growth and Economic Clout

Today, Hispanics form the largest minority group in the United States and are the second-fastest growing group in the United States behind Asian Americans. In 2017, the Hispanic population of the United States stood at 58.8 million, representing an increase of 16 percent, or more than 8 million, from just 2010.
U.S.-born Hispanics saw especially strong population growth. Between 2010 and 2017, the number of U.S.-born Hispanics grew by 22.8 percent, or more than 7 million, going from 31.9 million to 39.2 million. Meanwhile, the Hispanic immigrant population grew modestly, growing by 4.4 percent over the same period, reaching 19.6 million in 2017. This difference in growth rates means that most Hispanics in the United States today are not immigrants but rather U.S.-born. In fact, by 2017, the overwhelming majority — two out of three — Hispanic Americans were born in the United States.

Numbers also show that Hispanics are more active in the labor force than the U.S. population as a whole. This means that they are more likely to be of working age — between 16 and 65 — and are able and willing to work. In 2017, while the overall labor force participation rate in the United States was 63.2 percent, it was 67.4 percent for Hispanics and 68.7 percent for Hispanic immigrants. Hispanic immigrants also saw higher than average rates of employment. While the employment rate nationwide was 94.8 percent, it was even higher for Hispanic immigrants, at 95.5 percent.

By virtue of their size and the variety of skills they hold, Hispanic Americans are important contributors to the U.S workforce and to the economy. In 2017 alone, Hispanic American households, regardless of nativity, earned more than $1 trillion and paid more than $250 billion in total federal, state, and local taxes. After taxes, Hispanic households were left with more than $780 billion in spending power—money to spend on housing, groceries, entertainment, and other consumer goods and services, further stimulating their local economies. 

The consumer power of Hispanic Americans has grown so much that marketing to Hispanic consumers has itself become a growth industry. Felipe Korzenny, founder of the Center for Hispanic Marketing Communications, says the Hispanic marketing industry has at minimum doubled in the last decade to close to a $10 billion industry as businesses strive to attract the Hispanic consumer. “Companies that understand the market continue to do relatively well,” he says.

In some states the share of spending power held by Hispanic households was particularly high. In New Mexico, more than one out of every three after-tax dollars was held by Hispanic households. In Texas, almost one-quarter of residents’ spending power was held by Hispanic households. And in California, Hispanic households held one in five dollars in spending power, or more than $208.2 billion.

In just three states alone, California, Texas, and Florida, Hispanic households paid a combined total of $43.8 billion in state and local taxes and a combined $89.8 billion in federal income taxes. In these and other states, taxes paid by Hispanic Americans, whether U.S.- or foreign-born, are vital to funding municipal services and shoring up social programs like Medicare and Social Security.

Hispanic Americans and the Construction and Agriculture Industries

Hispanic American workers continue to play outsize roles in several major U.S. industries. Most notably, Hispanic workers in construction and agricultural industries are vital to filling workforce gaps at a time when demand for labor is high but the supply of available workers is nearing all-time lows.

In 2017, Hispanic Americans made up 29.1 percent of the workforce in construction, a $1.3 trillion industry that makes up 4 percent of the United States’ GDP and also drives demand in related industries such as manufacturing and mining.

The Hispanic American construction workforce is also a heavily immigrant one—more than two out of three Hispanic construction workers in 2017 were immigrants. Overall, this means that 1 in 5 construction workers nationwide are Hispanic immigrants.

Far from taking opportunities from U.S.-born workers, data show that Hispanic immigrants are helping to fill significant labor shortages on construction sites. “Eighty percent of our members tell us they’re having a hard time finding qualified workers,” says Brian Turmail, a spokesman for The Associated General Contractors of America (AGC), a trade group with 27,000 firms in every segment of construction except private homes. “The Latino population is an essential component of the construction industry in just about every part of the country.”

“If you think about construction, we don’t really do anything as an economy that doesn’t involve building something first,” he says. “Without people to do the work, we don’t have any economic activity and we don’t have any infrastructure.”

The U.S. agriculture industry found that without immigrant workers to help harvest and plant crops, U.S. farmers would be forced to scale back production or, worse, let ripe produce rot in the fields. To make up the shortage of interested workers, many U.S. farmers have come to rely on foreign-born, as well as local, Hispanic workers to help keep their farms running. By 2017, one out of three agricultural workers, or more than 1.9 million, were Hispanic, the vast majority of whom were born abroad. 

Laurie Swanson, who works at the Michigan Farm Bureau helping American farmers apply for H-2A visa workers, is intimately familiar with the migrant worker’s perspective: Her parents were migrant farm laborers from Mexico. Growing up, she and her siblings would join them, leaving their home in Texas to pack blueberries in Michigan from April to November.

“I remember going to the grocery store and seeing the blueberries that we had packed and my mother saying, ‘Look, we did this,’” Swanson says. “There was a level of pride in that. For me it connected that this isn’t small, the blueberries are going global.”

Hispanic Entrepreneurs

In addition to their role as workers, Hispanic Americans also boast some of the highest rates of business ownership in the United States. Entrepreneurship is one of the most important drivers of economic prosperity in the country as the lion’s share of new jobs created each year are at new or young businesses and firms. In 2017, 11.9 percent of Hispanic immigrant workers were self-employed, compared to 9.6 percent of the overall U.S. population. In other words, Hispanic immigrants were 24.5 percent more likely to have their own business than the overall U.S. population.

In 2017, there were 1.5 million Hispanic immigrant entrepreneurs, and although Hispanic immigrants made up only 6 percent of the U.S. population in 2017, they comprised 9.9 percent of the country’s entrepreneurs. In 2016, Hispanic-owned businesses in the United States took in more than $408 billion in sales and employed almost 2.8 million people.  

Hispanic Voting Power

As the number of Hispanics in the United States grows, and particularly as the number of U.S.-born Hispanics age into voting eligibility, Hispanic Americans will make up increasingly large shares of the electorate at a state and national level. By 2017, there were already more than 28.8 million Hispanic Americans eligible to vote, an increase of more than 7 million since 2010. Most of these 7 million were born in the United States, with the number of U.S.-born Hispanics eligible to vote growing from 16.1 million to 21.7 million during that time period, an increase of more than 5.5. million eligible voters. 

The contributions of Hispanic Americans shows again just how important a role they play in the U.S. economy as workers, taxpayers, and consumers. With earnings of more than $1 trillion each year and tax contributions of more than $252 billion, Hispanics not only add significant value to the U.S. economy but they also support and help fund social services and infrastructure that ultimately benefit all Americans.

As Hispanic Americans and immigrants continue to settle and establish even firmer roots in the United States, their contributions are only expected to increase. As Hispanics continue to disperse throughout the country, more communities around the nation will be able to benefit from their hard work and productivity. 

Excerpts reprinted from the New American Economy Research Fund