News Column

Trends in Economic Class Size and Income

December 2001

Overall, the U.S. Hispanic population grew from 14.6 million in 1980 to 35.3 million last year, a 141 percent increase. Demographers attribute the rapid growth as much to immigration as to relatively high birth rates; the number of foreign-born U.S. Hispanics more than tripled in the last two decades, most coming from Mexico and conflict-ravaged countries in Central and South America and the Caribbean. And while many are unskilled laborers, a sizable number have staked a legitimate claim to the middle class. VIEW CHARTS: Size of Hispanic Income Classes: Working Adults and
Number of Hispanic Househoulds by Income Group
The high rate of immigration has produced income disparity, however. While household income for native-born Hispanics increased between 1979 and 1999, it declined among those who were foreign-born. Similarly, the contrast in educational backgrounds between native-born and immigrants is striking. In 2000, two out of three Mexican immigrants had not graduated from high school, whereas almost three out of four Mexican Americans born in the United States had high school diplomas. VIEW CHART: Hispanic Household Mean Income, by Nativity Nevertheless, U.S. Hispanic population growth is evident at all income levels. Middle-income Hispanic households almost doubled in number, from 1.4 million in 1979 to 2.5 million by 1999. Low-income Hispanic households, populated mostly by immigrants, more than doubled over the same period, from 2.2 million to 4.9 million. High-income Hispanic households more than tripled in number, but account for less than 2 percent of the total. VIEW GRAPH: Hispanic Households that Own or Are Buying a House: 1996-2000 The average middle-class household income in constant dollars has not changed much over the past two decades, increasing by 4 percent, or about $2,500. The figure currently stands at a remarkably robust $64,878. Low-income Hispanic households actually experienced a slight decline in income over the same period, while the income of upper-class Hispanic households grew 24 percent, for an average increase of $48,000. Income per adult, however, grew 9 percent among middle-class Hispanics while declining 4 percent among low-income Hispanics between 1979 and 1999. VIEW CHART: Mean Hispanic Household Income, by National Origin VIEW CHART: Mean Hispanic Household Income, by Income Class What's more, the preceding data obscure perhaps the most significant feature of the Hispanic middle class: its burgeoning purchasing power. Middle-class Hispanics currently wield purchasing power of $278 billion. The Hispanic middle and upper classes combined have purchasing power of $333.3 billion, or more than 66 percent of the total for all U.S. Hispanics ($499.7 billion). This economic clout explains Corporate America's marked increase in ad spending targeting Hispanics (see this month's Media Markets Report). The question is, are such efforts aimed at the U.S. Hispanic middle class or the nation's substantial Hispanic immigrant population?

Source: HISPANIC BUSINESS magazine

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