By Renato Rocha, Policy Analyst, Economic Policy Project, NCLR
Demographic trends have long predicted that Latinos will be a large proportion of the country’s population, workforce, and economy. These forecasts are a reality today in California, where we get a glimpse into the nation’s demographic and economic future.
Today, California has the largest Hispanic population in the nation, with two in every five Californians (39%) identifying as Latino. Nationally, the U.S. Hispanic population stands at 56 million and, by 2050, is estimated to reach 106 million, accounting for one out of every four people in the country.
A new report by NCLR’s Economic Policy Project examines Latinos’ economic status across a range of indicators in California and offers recommendations for public policies at the state and national level that can boost economic mobility and security for more individuals.
The report finds that Latino families in California face a mixed picture of progress, stalled growth, and setbacks with respect to economic security. Five key economic trends among Latinos in California include:
- Hispanics Lead California in Labor Force Participation: Latinos in California lead the state in the percentage of the population in the labor force (64.7% compared to 62.2% overall).
- Increase in Median Household Income: The report describes that median household income for Hispanics in California was $49,682 in 2015. It also notes that between 2011 and 2015, California Latinos saw an increase of $5,305 in annual median household income.
- Hispanics Remain Outside of the Financial Mainstream: The FDIC’s Economic Inclusion Custom Data Table Tool shows that in 2015, 14.8% of California Latino households were unbanked, and 26.9% were underbanked. The report also notes that the FDIC found that in 2015, 31.7% of Latinos in California had used an alternative financial service (payday loan, pawn shop, rent-to-own, refund anticipation loan, or auto title loan) in the last 12 months.
- Latino Homeownership Rate Remains Low: Since 2012, the Latino homeownership rate has stalled, only increasing by a fraction of a percentage point from a low of 41.8% in 2012 to 42% in 2015.
- Latino Household Wealth Is Only Six Cents on the Dollar Compared with White Households: In 2011, Hispanic household median net worth in California was just $8,813, compared to $148,498 for White households.
These trends make clear that federal, state, and local policies must reflect the experiences of Hispanic Californians if they are to attain economic security. As the Latino community continues to drive economic growth in the state and throughout the country, it is critical that national, state, and community leaders create and advance solutions that do not undermine the hard work that has already been done, and address the long-standing inequities faced by Latinos.
NCLR is proud of its long presence in California, and is committed to advocating for policies that not only allow Latinos to contribute to the economy, but also share in the Golden State’s economic opportunities. We look forward to continue working with policymakers and other stakeholders to advance solutions that bolster the economic mobility of Latino families, and all Californians.