Latinos in the United States come from a wide range of backgrounds and contribute significantly to the economies within their home states, cities and towns across the nation. Policies that truly support Hispanics in the U.S. recognize their range of experiences, the contributions they have made, and the challenges many still face in striving for success for themselves, their families, and future generations. From moving the country forward in science, the arts, law and economics, to serving in the U.S. military, promoting labor rights, and working on the front lines of healthcare and essential services, Latino talent, dedication, and determination has helped drive American progress.
Hispanic communities are increasing their economic success and stability, and supporting the overall U.S. economy.
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Latinos are a growing community. In 2022, Hispanics made up over 19% of the U.S. population. In 2021, over 80 percent of Hispanics were either born in the U.S. or became U.S. citizens.
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They are heavily involved in the U.S. economy. As of August 2023, Hispanic or Latino workers have the highest labor force participation rate and among the highest employment rates, compared to the other largest demographic groups in the U.S.
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They kept the country moving during the pandemic. Latinos were overrepresented in essential and high-risk work and services that allowed the economy to continue moving throughout the pandemic, although this increased Latinos’ risk of exposure to COVID-19.
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They are driving U.S. business growth. Latino business and revenue growth continues to outpace that of U.S. businesses generally. In the last 20 years, growth in the number of Latino-owned employer businesses (a firm with at least one employee in addition to the owner) far outpaced the national average.
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They are earning degrees at an increased rate. From 1990 to 2021, on average, the rate at which Latinos have completed high school or earned a bachelor’s degree grew at a faster pace than the national rate. In 2021, more than one in five students enrolled in higher education were Hispanic.
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They provide major contributions to national GDP. According to a 2019 report, if the total GDP generated by Latino communities in the U.S. had been the GDP of a single country, that country would be the eighth-largest in the world. A later report estimates U.S. Latino output would rank 5th in the world, if it were the output of an independent country.
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Latino immigrants play a major role in these contributions. About 44% of immigrants in the U.S. were Hispanic in 2021. Immigrants generally work in core industries, such as providing essentials like health care and housing. Immigrants’ children also often meet or exceed the educational attainment levels of children with non-immigrant parents, which further drives the U.S. economy.
Despite these contributions, Latinos face systemic barriers to upward economic mobility.
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Latinos, like other communities of color, confront job segregation. A 2021 study found that Hispanic workers are underrepresented in higher-paying or managerial positions, especially in manufacturing sectors and sectors with lower wages. Latino workers are also underrepresented in high-paying business, finance, and legal professions, which tend to offer greater opportunity for upward mobility. Moreover, those who are able to reach these professions earn less than their white counterparts.
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Despite their contributions to the U.S. labor force, they have lower wages and experience higher rates of poverty. Hispanics, including Hispanic women, had the lowest median usual weekly earnings of full-time wage and salary workers among the largest demographic groups in 2021. Moreover, while 13% of the U.S. population lived below the poverty line in 2021, about 18% of the Hispanics were doing so.
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They receive less approvals for business loans, despite strong applications. Latino entrepreneurs present similar or better qualifications in their loan applications, yet Latino-owned businesses are less likely to receive approvals than white-owned businesses.
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They experience barriers to higher education. Despite gains in higher education, only 45% of Hispanics living in the U.S. had an associate’s degree, some college but no degree, or a higher degree, compared to 63% of all Americans in 2021. Research points to financial constraints as a major barrier to higher education for Hispanic students.
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They hold less accumulated wealth, with a greater gap at higher levels of education. Hispanic millennials had just $15,000 in median wealth in 2019, while white millennials held $53,000. Moreover, research found the gap was larger between white and Hispanic workers with higher degrees in 2019. While the gap for those with a high school diploma was $68,000 in median household wealth, and $37,000 for those with less than a high school diploma, those with a bachelor’s degree and post-graduate degree saw a gap of $221,000, and $354,000, respectively.
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Limited access to healthcare, nutritious food and housing create conditions of instability for Latino families, and impacting their ability to succeed. As of 2021, about 18% of Latinos were without health insurance, compared to only 5.7% of the white, non-Hispanic population, yet Latino families face higher rates of certain serious health conditions. Additionally, in 2021, the share of Hispanic households that were food insecure (16%) was higher than the national average (10%). In that same year, the Latino homeownership rate was 22 percentage points lower than that of white homeownership.
When Hispanic workers overcome economic challenges, discrimination can still prevent them from reaching their full professional potential.
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Hispanic workers report discrimination across employment levels. According to a 2021 Gallup poll, about one in three young Hispanic workers report facing discrimination at work. IBM’s 2020 survey of 1,000 Hispanic leaders also found that 87% of respondents reported experiencing discrimination due to their ethnicity.
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Latinos face discrimination in high-paying STEM fields. Hispanic workers made up only about 15% of the STEM workforce in 2021. Yet, a recent study found that Latino students tend to declare STEM majors at roughly the same rate as white students. The study’s authors, in addition to other research and statements from students of color in STEM, suggest that experiencing exclusion and microaggressions in these fields contribute to Hispanic and Black students leaving their major.
Policymakers must address these challenges to ensure equitable paths to success for Hispanic communities.
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The Biden administration has made historic investments in Latino communities, helping them to overcome systematic economic barriers to economic security. The expanded Child Tax Credit, for example, helped over 1 million Latino children emerge from poverty in 2021, leading to a historic low in the Hispanic child poverty rate. Moreover, President Biden’s Treasury Department has supported majority Latino-owned depository institutions with investments totaling $1.6 billion and has increased federal investment in Latino-owned businesses. Additionally, the Biden administration supported housing stability among Hispanics, through assistance in maintaining homeownership and rental assistance. Congress must provide continued funding towards these and similar efforts, to ensure increased access to opportunity for Latino families.
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Congress can do more to address discrimination by funding the Equal Opportunity Employment Commission (EEOC). After cuts to the EEOC, the Commission does not have sufficient funding and employees to fulfill its mission under the Civil Rights Act, to ensure diverse communities’ protection against workplace discrimination. While the Biden administration has made great efforts in increasing the efficacy and strength of the EEOC, Congress can help address inequity in upward mobility for Hispanic communities by meeting the EEOC’s request for funding.
