News Column

For First Time in Decades Hispanic Purchasing Power Slows

May 2, 2011

Blair Koch

Purchasing power down

For years, Jose Arellano considered himself lucky.

With a steady bi-weekly paycheck and a good job at an area dairy, Arellano was able to buy the things his two children wanted.

Periodically, the Jerome resident would even have a little money to wire to his family in Mexico.

At first, the national recession wasn't even a blip on his radar but then milk prices crumbled, taking periodic bonuses with it. Then, Arellano's wife, who worked in food service, lost her job in early 2010.

"We've had to do without a lot of things," Arellano said before stepping into the Mi Pueblo store in Buhl.

Like many Idaho Hispanics, the Arellanos' funds shrunk- and so did their buying power.

A recent report from the Idaho Department of Labor found that for the first time in two decades Hispanic per capita buying power fell.

Labor's report defines buying power as "the after-tax personal income people have to spend on virtually everything from necessities like food, clothing and housing to luxuries like recreation equipment and vacations."

Using estimates from the Selig Center for Economic Growth and statistics from the U.S. Census Bureau, the report found that Idaho's total Hispanic buying power increased 5.2 percent from 2009 to almost $2.8 billion in in 2010, or three times the increase posted by the rest of the state's population.

However, because Idaho's Hispanic population grew faster, at 6.4 percent over the same time period, their per capita buying power fell by a little more than 1 percent, from $15,868 in 2009 to $15,687 in 2010.

In comparison, non-Hispanic buying power was double, at nearly $31,000.

Nationally, Hispanics in 31 other states saw even stronger economic growth than their Idahoan counterparts.

Area businesses are feeling that pinch.

Aaron Nieto said his family's business, the Mi Pueblo stores in Buhl and Twin Falls, has been hit hard by the shaky economy.

"Instead of buying our tortillas, people are buying them at other stores because they are cheaper. Sales of our pastries have also fallen a lot because people will do without bread or eat something cheaper," Nieto said. "A lot of Hispanics have big families and when every dollar counts you make it stretch as far as it will go."

Nieto said Mi Pueblo's sales typically double when migrant workers are in the Magic Valley.

"We've heard that not as many migrant workers will be coming here this year and that has us worried," Nieto said. "We are doing everything we can to not raise prices. We are all working harder, we've had to let some employees go ... but our prices are increasing. Fuel and wheat prices have really increased and so it isn't good, all the way around."

Lupe Loza, who owns and operates La Plaza restaurant in Buhl, said customers are sharing meals or doing without a Jarritos soda or beer.

"Are people spending less? Oh, yes," Loza said. "But I think it is getting better. It isn't good yet but it is starting to turn around."

Source: Copyright (c) 2011, The Times-News, Twin Falls, Idaho

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