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Spending Spree

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In a related announcement, Bromley (which will continue to exist as an ad agency), Chicago-based Lápiz, and a handful of other companies will contribute creative resources to Pangea, a new ethnic marketing communications group.

Hispanic Purchasing Power on the Rise

The nation's uncertain economic outlook notwithstanding, Hispanic purchasing power has continued to show steady growth, increasing 5.2 percent this year to almost $500 billion. While less impressive than last year's 6.2 percent growth rate, this year's increase is perhaps even more remarkable given the extraordinary nature of recent events.

There are two main reasons for the strong growth. First, the U.S. Hispanic population surprised Census forecasters and most economists by rising much faster than expected. Second, the tax relief package passed by Congress is retroactive to the beginning of this year, thus increasing disposable income for most households. Assuming that educational levels continue to rise, this trend is projected to extend into next year. The growth may be slow, however, depending on the severity of the looming U.S. recession.

The purchasing power estimates by HispanTelligence, the research arm of Hispanic Business Inc., are based in part on disposable personal income as determined by the Bureau of Economic Analysis (BEA). Disposable personal income reflects after-tax income available for spending or saving and consists of more comprehensive sources of income than any alternative income estimates.

Other factors involved in calculating purchasing power estimates include an income disparity factor (IDF) between the Hispanic and general populations and an adjustment for the undercount of the Hispanic population as reported by the U.S. Census Bureau.

Other Hispanic purchasing power estimates have been prepared by the University of Georgia's Selig Center, Strategy Research, and Santiago & Valdez Solutions. The estimates range from $300 billion to $561 billion. Variances in the estimates arise mainly from the use of different income figures, such as the U.S. Census Bureau's definition of money income, alternative methods for calculating the IDF, and varying forecasts of these factors for 2001. Also, some estimates may not take into account the reported Census undercount of the Hispanic population, for which HispanTelligence made an adjustment.

U.S. Hispanic Purchasing Power


Population (millions)

Purchasing power (billions)










Source: Population estimates are by the U.S. Census Bureau, except for the year 2001, which is by HispanTelligence®, a division of HISPANIC BUSINESS.
© 2001 Hispanic Business Inc. Reprinting, copying, or transmitting all or part of this information requires written permission.

Media Markets Methodology

Source: HISPANIC BUSINESS magazine

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