(CN) – In the decade since the Great Recession, the income of Latino workers has not bounced back as fast as other ethnic groups largely because of a weaker recovery for those born in the United States.
The recession of 2007-2009 triggered a decline in the incomes of American workers, but the average income is recovering. In 2017, the median personal income of American workers spiked to 3 percent higher than in 2007.
But while on the surface a similar recovery seems to be underway for Latino workers, a new Pew Research Center analysis of government data found the overall gain “masks a sharp contrast in the experiences of U.S.-born Latinos – whose incomes in 2017 were 6 percent less than in 2007 – and of foreign-born Latinos, whose incomes were 14 percent higher than in 2007.”
The analysis used data from the Current Population Survey, Annual Social and Economic Supplement (CPS ASEC), jointly conducted by the U.S. Census Bureau and the Bureau of Labor Statistics, and found demographic change, not the economic recovery, is the major driver of the gains for Latino immigrants.
Pew’s extrapolations found “[a] slowdown in Latin American immigration led to a steep rise in the share who have lived in the United States for at least 10 years. Longer-tenured immigrants earn more than the typical immigrant, and their rising share gave a sizable boost to the average income of foreign-born Latinos.”
Further, Pew found that U.S.-born Latino workers, who are, on average, younger and less educated than U.S.-born workers overall, experienced greater losses in the recession and have been left behind in the economic recovery.
The data indicates that with the slowdown of Latino immigrants – especially from Mexico – the average foreign-born worker is older and has more experience in U.S. job market, which increases the median income of foreign-born Latinos working in the U.S. The decline in unauthorized immigrants coming into the United States also raised the median income of the Latino immigrant labor force.
In 2007, the mean income of undocumented Latino workers was about 70 percent of the income level of Latino immigrants in the country legally, due in part to differences in education levels.
The weaker financial recovery experienced by Latinos is mirrored by the experience of black Americans. While the median income of workers is up 3 percent across all ethnic groups, white workers reported a 7 percent gain, Asians a 12 percent increase, and Hispanics a 5 percent increase. But the median income of black workers has gone up only 1 percent since 2007.
Though foreign-born workers in all ethnic groups experienced similar jumps in median income to that reported by Latinos, the smaller number of white and black immigrants kept the increases from significantly affecting overall averages.
Pew speculates these trends in the personal incomes of Latinos may explain why in a 2018 survey only 33 percent of Hispanic adults said that their financial situation was in “excellent” or “good” shape.
“The rising pessimism among foreign-born Latinos echoes the finding that the recent growth in income for them is more a result of demographic change than a change in economic circumstances,” the researchers say.