Miami Beach, Florida, Café Sazon, Cuban flag with seniors at the table.
Jeff Greenberg | Universal Images Group |
The Latino economy in the U.S. grew 13% from $3.2 trillion in 2021 to $3.6 trillion in 2022, according to a new report released Thursday by the economic think tank Latino Donor Collaborative and Wells Fargo.
This would make the cohort the fifth largest economy in the world – and would surpass the annual production of India, Great Britain, France and Canada.
“There is no doubt that the Latino economy is a formidable force in the United States, characterized by strong GDP growth, significant population growth, high labor force participation and improved educational attainment,” Sol Trujillo, chair of the Latino Donor Collaborative, said in the report.
“This is not about diversity and inclusion; it is a critical business strategy,” Trujillo added.
The report is based on data from 2022, the latest year for which information is publicly available, and includes data from the U.S. Census Bureau, the Bureau of Economic Analysis, and the Bureau of Labor Statistics, among others.
Looking at the world's top 10 economies between 2017 and 2022, Latinos would be the second fastest growing economy with an average annual real growth rate of 4.6%, only China would be faster at 5.3%. The growth rate of Latinos' gross domestic product (GDP) in the United States is also 2.6 times higher than that of the rest of the U.S. economy.
The strength of Latino industries remained stable in manufacturing, public administration, accommodation and food services, construction and transportation.
California again led in Latino GDP in 2022. Here's a look at the five states with the highest Latino GDP, according to the report:
- California: $935.2 billion
- Texas: $686.6 billion
- Florida: $347.8 billion
- New York: $268 billion
- Illinois: $125 billion
Antonio Munoz, owner of the 911 Taco Bar restaurant, prepares carne asada and chicken, meats whose price and cost to his business have increased due to recent inflation, in Las Vegas, Nevada, on February 1, 2024.
Patrick T. Fallon | AFP |
Latinos’ wealth is rising rapidly
The economic boom of Latinos has also led to an increase in wealth for this group.
According to new data from the Hispanic Wealth Project, the wealth of Hispanic households has tripled in the last decade.
This is two years ahead of the goal set by the nonprofit after Latinos lost up to two-thirds of their median household wealth during the Great Recession. By 2022, the median net worth of Hispanic households reached $63,400 – 3.17 times more than in 2013 when adjusted for inflation.
Rising homeownership rates, rising real estate prices and an increase in the number of Hispanic-owned businesses have all contributed to the steady growth, HPW reported.
However, a significant gap remains when comparing the group to non-Hispanic white households, who had a median net worth of $283,300 in 2022. For the total population, the median net worth was $192,160.
“The Latino cohort in the United States is critical to the future of our country,” Trujillo said.
Latin American economy shows no signs of slowing down
The LDC also presented a forecast for the U.S. Latino economy through 2029. It uses the International Monetary Fund's national GDP forecasts to show that this group's economic output will surpass that of Japan by 2024 and Germany by 2027.
A significant part of this, Trujillo said, is due to the population growth rate of this group. “The growth of the Latino population in the United States is almost ubiquitous across the country.”
Latino economic growth is also faster than that of non-Latinos in states like Colorado, Washington, and Georgia. Between 2021 and 2022, the Latino population in the U.S. grew by 1.65%, while the non-Latino population grew by only 0.08%. This growth has resulted in the Latino population being significantly younger than their peers, with a large share of Latinos not yet entering the labor force.
As a result, the US economy is increasingly dependent on Latinos to increase the workforce, Trujillo said. “Every thirty seconds, a young Latino turns 18 in the US.”
“Leveraging the unique and tremendous opportunities offered by the Latino market in the United States will benefit every American,” Trujillo said.
The report's findings were released during the L'Attitude conference, which examines the state of Latino leadership, participation and representation in the American economy, public sector, and media and entertainment sectors.
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