In keeping with a brand new report, Latinas have contributed $1.three trillion to the U.S. financial system. That quantity could possibly be even greater

Miami Beach, Florida, Manolo restaurant, bakery counter employee. (Photo: Jeffrey Greenberg/Universal Images Group via Getty Images)

Jeff Greenberg | Universal Images Group |

Latinas make a significant contribution to the U.S. economy.

According to a recent report funded by Bank of America, the female Hispanic population contributed $1.3 trillion to the gross domestic product in 2021, up from $661 billion in 2010.

This represents a real GDP growth rate of 51.1% between 2010 and 2021 and an economic contribution 2.7 times higher than that of the non-Hispanic population.

Total Latina output in the U.S. was also larger in 2021 than the entire state of Florida that year, the report said, citing data from the Bureau of Economic Analysis. In fact, only Latina output in California, Texas and New York was larger this year.

Despite these high numbers, some economists believe that the contribution of Latino women to U.S. GDP may be higher than the report suggests.

Belinda Román, an economics professor at St. Mary's University, said there are activities in several areas that may not be captured by the data. Child care is one of those areas.

“A lot of it is unpaid care,” she said in an interview with CNBC. “Interestingly, there are a lot of Latinas in that field who aren't included in those numbers, so I think to some extent it might actually not be big enough.”

Economist Mónica García-Pérez also believes the number could be even higher. She says that some of Latinas' “unmeasured” contributions – such as being housewives and mothers who care for other neighbors' children – “enable other groups to participate in the labor market.”

She also referred to the professional positions they generally hold as difficult in evaluating their contributions.

“This group is very sensitive to shocks, and that could be related to their presence in sectors where there is a lot of mobility or turnover,” said the Fayetteville State University economics professor. She added that they tend to be concentrated in care and service industries such as healthcare, retail and hospitality. This makes them a “moving part” in economic cycles.

In the event of a recession, García-Pérez said, Latinas, for example, “would likely lose their jobs much more quickly in their industries,” as was seen during the Covid-19 pandemic. “But they could also be more likely to be integrated back into the labor market because the cost of entry and the types of positions they occupy have lower barriers.”

A growing force

When it comes to labor market participation, Latinas outperform other groups, the BofA report shows.

From 2000 to 2021, the labor force participation rate of Latinas increased by 7.5 percentage points. The labor force participation rate of non-Hispanic women, however, remained unchanged over the same period.

The group was also more resilient than others. Although labor force growth slowed overall in 2020, growth rates for Hispanic men and women were still positive. Conversely, the growth rate of the non-Latino labor force was negative that year, meaning more people left the labor force than entered it.

In addition, Latino GDP grew more than five times faster than non-Latinos between 2019 and 2021, at 7.7% versus 1.5%. At the same time, Hispanic male GDP grew nearly four times faster than non-Latinos during those years, at 5.9%.

These contributions are notable considering that Latino households were among those hit hardest by the pandemic.

“When the economy at large needs the most support, that's when we actually see the most dramatic contributions from U.S. Latinas,” said economist Matthew Fienup, co-author of the report and executive director of the Center for Economic Research and Forecasting at California Lutheran University. “While all Latinos are a source of economic strength, Latinas are the engines of the vitality that the economy needs.”

“If Covid-19 couldn't stop this growth, it's hard to imagine what could,” said David Hayes-Bautista, co-author of the report and director of the Center for the Study of Latino Health and Culture at UCLA's School of Medicine.

Drivers of change

Since the late 1970s, the share of Latinas with a job has increased. Specifically, the employment rate of this group has increased from 41.6% in December 1978 to 56% in December 2023, according to data from the Economic Policy Institute.

By comparison, the share of black women – who, along with Latinas, have the largest wage gap compared to white, non-Hispanic men – has increased by 11.9 percentage points. The figure for women overall has increased by 8.8 percentage points during this period.

“Part of it is an expansion of opportunities for women,” said Elise Gould, a senior economist at EPI. Part of it is also due to the lack of wage growth for regular workers over the past few decades, she said. “Because it can be difficult to get ahead, households may have had to work more hours to do better.”

That appears to be paying off to some extent. Growing labor force participation and increases in educational attainment are leading to income gains for this group that were about 2.5 times higher than for non-Hispanic women between 2010 and 2021, the BofA report's co-authors found.

Brooklyn Puerto Rico Day Parade on June 13, 2021 on Knickerbocker Avenue in the Bushwick neighborhood of Brooklyn, New York.

Andrew Lichtenstein | Corbis News |

Hayes-Bautista also cited generational change and the faster population growth of Hispanic women compared to Hispanic men and the non-Latino population as another catalyst for Latino economic performance.

“Around 2000, we saw that first-generation immigrants were dropping out of the labor market,” he said. “As they get older, their daughters and granddaughters will follow in their footsteps, who are twice as numerous as the population and bring with them much more human capital.”

Latinas in particular have bolstered overall Latino contributions. Fienup told CNBC that overall Latino contributions have led to positive labor force growth in certain regions of the country at a time when the non-Latino workforce was declining.

“We expect this dynamic to become increasingly important over the next three decades,” he said. “What we are seeing now is actually just the beginning of a story that will become increasingly important to the U.S. economy.”