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Latin Post: US Latinos Earn Less, Underrepresented in High-Paying Industries

Oct 21, 2015
In The News

The average U.S. Latino worker is earning less compared to non-Hispanic whites. According to a report by the Joint Economic Committee (JEC) and Congressional Hispanic Caucus (CHC), Latinos are behind the majority white population on several important economic factors, such as employment and income.

Despite representing 17 percent of the total U.S. population and the largest ethnic group in the country, Latino households are earning thousands of dollars less than non-Hispanic white households. The report noted Latino households' median income is $42,500, which is $18,000 less compared to the non-Hispanic white population.

Financial earnings for Latinas are considerably worse compared to Latino males and white males. Latinas earn $0.55 cents for every dollar earned by non-Hispanic white men, and 88 percent of what the average Latino male earns.

The report, titled "The Economic State of the Latino Community in America," does shine a positive, or "hopeful," light for the Latino community. Taking into account the Latino population's youth -- which is approximately 10 years younger than the overall population (28.4 years old vs. 37.7 years old), advancements in education and "entrepreneurial drive," the report noted there are future opportunities for the community.

Based on the U.S. Bureau of Labor Statistics (BLS) data of workers over 16 years old, the JEC acknowledged Latinos have an important role in many industries and represent 16.3 percent of private-sector jobs. In fact, Latinos are overrepresented in many industries, including construction, agriculture and leisure and hospitality, even if it's a low-paying job.

Unfortunately, in high-paying industries, Latinos are underrepresented, notably in business, financial activities, education and health services. Latinos are also more likely to be employed in "service occupations," such as food service, grounds keeping and maintenance. Less than

1 percent of Latino workers are employed in typically higher-paying jobs, which includes architecture and engineering.

As a result of Latinos working in low-paying jobs, their average earnings are less than non-Hispanic whites. A full-time employed Latino's median weekly earnings is reportedly 27 percent less than the non-Hispanic white worker -- at $602 vs. $829, per week.

Foreign-born Latinos received an even lower median household income with $34,600.

The Great Recession had a significant impact on Latinos. During this period, the Latino unemployment rate hit 13 percent, higher than the national unemployment rate average of 10 percent. Since then, the Latino unemployment rate has declined, currently at 6.4 percent, according to the BLS as of September. The report also noted that Latino employment increased by more than 4.7 million workers since 2010 -- accounting for 40 percent of the total US. employment gains. The increase of Latino workers has been attributed to the construction and mining industries.

Latinos' impact on the business and economic sector is significant, not only through their $1.3 trillion purchasing power but also through entrepreneurship. Citing the U.S. Small Business Administration, Latinos own 3.2 million U.S. businesses. The Kauffman Index of Entrepreneurial Activity said Latinos are 1.5 times more likely than the overall population to be entrepreneurs. Within the immigrant entrepreneur community, 90 percent are Latino.

But despite these positive numbers, Latino business owners are said to be low-income entrepreneurs compared to white business owners. Ironically, the low-income status is reportedly due to most Latino entrepreneurs being immigrants -- often encountering lack of capital access and higher rates of failure.

"It's important to know where we are as a Latino community and what we need to do to continue in the right direction. We are making progress in some areas. ... But in other areas we are still lagging behind," said CHC Chairwoman Linda Sanchez on Wednesday morning during the report's presentation.

Sanchez, congresswoman for California's 38th Congressional District, said investments must be made for the Latino community as hard working families are still seeking the American dream. She called for legislation that will help Latino families, noting the CHC has been working on increasing the minimum wage, college affordability and closing the wage gap.

"We need to support these policies that help our padres, our Latino millennials and our kids. Children like my son Joaquín who just started first grade and are the future of our country. They are the ones who will suffer if we don't invest in our Latino community now," Sanchez said.

"As a nation of immigrants, it's alarming to see how much further we have to go to make sure all children can afford to go to college, own their own home and earn a secure retirement," House Democratic Caucus Chairman Xavier Becerra, representing California's 34th

Congressional District and fellow CHC member, said in a statement. "My parents came from a generation where even without a college degree, they were able to send their four kids to college. I don't know how many construction workers and clerical workers today can still dream to send their kids to college, and this needs to change."

Currently, more than 55 million Latinos live in the U.S., and the aforementioned number continues to grow. By 2060, Latinos are projected to represent nearly 30 percent of the country's population. While the Asian population is also expected to increase, from 5 percent to 9 percent, the non-Hispanic white population rate is estimated to drop from the current 62 percent to 44 percent in 2060.