As people across the country continue to celebrate Latino Heritage Month, a newly released report shows that Latinos in the United States contribute far more than cultural traditions. In fact, in 2021, the Latino GDP surpassed the $3 trillion mark for the first time in American history.
In addition, if U.S. Latinos were a stand-alone country, they would have the fifth largest economy in the world – outpacing the economies of India, France and the United Kingdom.
Researchers discussed these statistics and other highlights of the 2023 U.S. Latino GDP Report – which compiles economic data related to the GDP (gross domestic product) of Latinos in the U.S. (of any immigration status and background) – during a livestreamed presentation at UCLA earlier this month.
“The Hispanic-Latino population is a driving force within the U.S. economy,” said Ray Vasquez, market executive for Bank of America, which commissioned more than 20 regional Latino GDP reports. “This important research brings clarity and attention to just how much Hispanic-Latinos outpace others in business creation, educational attainment and labor force participation.”
Co-produced by the UCLA Center for the Study of Latino Health and Culture, and the Center for Economic Research and Forecasting (CERF) at California Lutheran University, the sixth annual nationwide report also shows that the GDP of Latinos in the U.S. grew 7.1 percent in 2021.
“The Latino GDP is rapidly growing – more than twice as fast as non-Latino GDPs in the U.S. between 2010 and 2021,” said Matthew Fienup, Ph.D., executive director of CERF.
Contributing Factors Cite Growth
– Latino-owned businesses are growing three times faster than other businesses;
– Over the next 20 years, more than 75 percent of new homeowners will be Latino;
– The number of Latinos earning a bachelor’s degree is growing almost three times faster than non-Latinos;
– Among the 10 biggest GDPs in the world, the GDP of U.S. Latinos grew at the second-fastest rate from 2020 through 2021; only the GDP of China grew faster;
– Despite making up only 19 percent of the U.S. population, Latinos were responsible for 39 percent of the growth of the national GDP in 2020 and 2021; and
– Latinos have been responsible for 73 percent of the growth in the U.S. labor force since 2010.
One factor that has contributed to the significant growth of the Latino GDP is the growing number of Latinos. Between 2010 and 2021, Latinos accounted for more than half of the population growth in the U.S. According to U.S. Census Bureau data, the U.S. Latino population is nearly 63 million, with an estimated 4.8 million Latinos in Los Angeles County alone.
“In Los Angeles, where Latinos make up half of the population, the economic impact is nearly $300 billion, larger than the economy of entire states, such as Oklahoma or Iowa,” said Vasquez.
The Latino GDP numbers contradict many negative myths about Latinos in the U.S., especially the inaccurate view that they purportedly take more from the economy than they give back.
“One of the many reasons why Bank of America has financially supported this research … is that these staggering contributions to the economy and to our society are far too often overshadowed by a different narrative,” he said.
How Latinos Help the Economy
Dr. David Hayes-Bautista, director of the UCLA Center for the Study of Latino Health and Culture, described the U.S. Latino population with three words: “Big, growing, resilient.”
“It’s not that immigrants came to the U.S. economy; the U.S. economy came to Latinos, and Latinos made it stronger,” said Dr. Hayes-Bautista, chief demographer for the Latino GDP project. “As a group, [Latinos] will continue to make the U.S. economy stronger.”
How? Due to a combination of factors, he explained. In addition to their high population growth, other key factors include: Latinos are younger, healthier, have longer life expectancies, are entrepreneurs, have higher labor force participation, and have slightly larger households.
“A [generation] of largely poorly educated immigrant parents created the world’s fifth largest economy,” said Dr. Hayes-Bautista. “The children of immigrants are bringing much higher levels of human capital to the economy.”
That higher “human capital” comes from better education, he explained. In fact, almost 90 percent of U.S.-born millennial Latinos graduated from high school, and while only one-third of immigrant Latinos go to college, two-thirds of U.S.-born Latinos choose to attend college.
“What kind of economy will the highly-educated, bilingual, U.S. citizen children be capable of creating?” continued Dr. Hayes-Bautista. “The answer to that is the answer to the future of the U.S. economy.”
For more information about the 2023 U.S. Latino GDP Report, go to: www.latinogdp.us.