Study: Financial Stability Eludes Many College-educated Latinos

Photo: http://401kcalculator.org, Creative Commons

Photo: http://401kcalculator.org, Creative Commons

New findings from a TIAA-CREF Institute study show the continued fragile financial state of Latinos. This study focuses on the economic status of college-educated Hispanics, drawing on data from the 2012 National Financial Capability Study and examining the personal finances of respondents.

Over half (59 percent) of college-educated Latinos reported that they had difficulty meeting monthly financial obligations, and over half were also unable to put away savings. Increased levels of educational attainment generally correspond with greater economic opportunities and, potentially, greater financial stability, making these findings concerning.

The TIAA-CREF study echoes what was found in Banking in Color, a report released by NCLR, the National Urban League, and the National Coalition for Asian Pacific American Community Development in 2014. This report was based on a survey of the financial access of low- and moderate-income communities of color in various U.S. cities. When asked where they would turn for funds in the event of a financial emergency, nearly half (42 percent) of all respondents said they did not know where they would acquire the money. Moreover, nearly one in three (31 percent) individuals employed full time said that they had experienced a financial emergency within the previous year.

While the economy is recovering from the Great Recession, clearly for many Americans, especially those in communities of color, that recovery is slow in coming.

One difference in findings between Banking in Color and the TIAA-CREF data was in savings behavior. As noted above, the majority of college educated Latinos in the TIAA-CREF survey did not have savings, and in contrast, almost half of Banking in Color respondents reported that they saved on a monthly basis. This was a positive trend, though most reported that they relied on saving via a traditional savings account, which is a relatively low-interest savings vehicle. Moreover, because so many reported having experienced a financial emergency within the past year, it is unclear whether they could sustain a financial hardship with their household savings.

Shifting demographics in the U.S. make the ability of Latinos to reach financial security a critical issue for public policy to address. Population projections show that the U.S. will become “majority minority” in 2043, less than 30 years from now. The ability of Latinos and other low-income communities to secure their economic footing will greatly impact the strength of our national economy.

At Long Last, Latino Employment Bounces Back

By Janet Murguía, President and CEO, NCLR

GuardRailWorkers_12_2_2014The U.S. economic recovery is in full force. February marked the 12th consecutive month of job growth above 200,000, with U.S. employers adding nearly 300,000 new jobs. But an even more promising sign of recovery is the jump in Hispanic employment. A front-page article in Sunday’s New York Times points out that the unemployment rate for Latinos has finally returned to its pre-recession average and job growth for Hispanics is outpacing other groups. This is good news for everybody, since Hispanics and Blacks were two of the communities hardest hit by the recession. The fact that not only Latino but also Black job growth in recent months is outstripping that of the job market overall means the recovery is more complete, more widespread, and more sustainable. But before we declare mission accomplished, let’s take a closer look at the economic recovery and the Latino employment picture.

The good news is that Latino unemployment is declining because more Latinos are working. As has historically been the case, Latinos are more likely than other workers to be employed or actively seeking work. Last month, the Latino labor force participation rate was 66 percent, compared to 63 percent for Whites and 61 percent for Blacks. Throughout the recovery, NCLR has highlighted several growth industries where Latinos are overrepresented, including restaurants and temp firms, home care, and retail. The revival of the construction industry in particular, where Latinos make up one-quarter of the workforce, is one industry that is helping the unemployment rate bounce back. Job gains in construction are also visible to those who do not work directly in construction, helping to build overall confidence among Latinos that the broader economy is improving. More work is probably the main reason that Latinos experienced a small, though significant, decline in poverty in 2013 when no other group experienced a change.

farmworker_thanks_newWhenever there is good news about Latinos, we brace for an attack from those who seek to blame immigrants for their own economic woes, despite the fact that the article confirms what we and many others have been saying all along—the Obama administration has engaged in an unprecedented amount of immigration law enforcement. But as Noam Scheiber points out, it’s U.S. citizens, not immigrants, who are the primary Latino beneficiaries of the job growth in the economic recovery. Many people are surprised to learn that U.S. citizens are now the majority of the Latino workforce. Additionally, U.S.-born workers either benefit or are not affected at all when immigrants find work. In the article, Giovanni Peri, a well-respected expert on the economic effects of immigration, sums up the virtuous cycle this way: “More construction workers generates the need for more supervisors, more managers to coordinate them, more contractors to give them work.”

But while the availability of jobs is improving, more needs to be done to raise the quality of those jobs to ensure that the benefits of the economic recovery are more widely shared. In a poll conducted by NCLR last summer, a majority of Latino voters said that they have not seen improvement in their household finances since the Great Recession. Fifty percent added that they are worried that they may not have enough money to pay their basic bills. Indeed, wages are growing slowly, but Latinos are more likely to earn poverty-level wages. This stems in part from a long-term trend in which wages have not kept pace with worker productivity. A White House report points this out directly: “In 2014, average real wages for production and nonsupervisory workers increased 0.8 percent after increasing 0.7 percent in 2013. Although not sufficient, these increases are a marked improvement from the 2000s, including the pre‑Great Recession years of 2001 to 2007, when real wage growth averaged 0.5 percent a year.” In addition, there has been a marked rise in part-time work—even among workers who would rather work full-time.

Labor-Day-Banner-Photo-6_resizedClearly the U.S. economy is moving in the right direction, but more needs to be done to build on the gains of hard work to ensure that all workers reap the benefits of the improving economy. These include:

  • Raising the federal minimum wage to restore its value to keep a full-time working family out of poverty. This should be at the top of Congress’s agenda.
  • Stepping up enforcement of labor laws, including basic health and safety protections, to make sure that workers do not pay with their lives—as many Latino workers do—for a day’s wage.
  • Making permanent the 2009 expansions of the refundable Earned Income Tax Credit and the Child Tax Credit, which keep 16 million people out of deep poverty.

The good news is that Latinos and other communities are finally benefiting from the protracted economic recovery. It will be even better news if we make policy changes such as those above and make the investments necessary—as well as enacting comprehensive immigration reform, which will end wage abuse and put all workers on a level playing field. We need to secure this still-fragile recovery among communities of color by maximizing what they can earn, create, and contribute to further benefit our economy and the well-being of all Americans.

Marking Latina Equal Pay Day

By Catherine Singley Harvey, NCLR Economic Policy Project

Labor-Day-Banner-Photo-6_resizedToday is Latina Equal Pay Day, marking the day when the average Latina worker’s wages catch up with the wages earned by the average non-Latino White man last year. According to the National Women’s Law Center, the gender wage gap is “the amount of money a woman would have to earn for every dollar made by a man in order to have equal annual earnings.” In 2013, women in the U.S. working full time year round made only 78 cents for every dollar a man made. Hispanic women earned only 56 cents. This is not just about the kinds of jobs Latinas hold; the gap persists between workers in the same occupations, from surgeons to customer service representatives.

Latina Equal Pay Day is no cause for celebration; rather, it is the stark reminder that pay discrimination still undermines the economic security of women, and especially Latinas, and their families. The real life consequences of wage disparities are devastating for Latino families, particularly because so many Hispanic households rely on the income of Latina mothers or heads-of-households to provide. An analysis by the National Partnership for Women and Families finds that about 40 percent of married Latina mothers earn at least half of their families’ income. Of the nearly 2.8 million households in the U.S. headed by a Latina, more than 1.1 million currently live in poverty. Nationwide, the Latino poverty rate is more than double the poverty rate for Whites.

We’ve heard from Latina voters directly that they are alarmed about low wages. A national poll of Latino voters by NCLR and Latino Decisions found that nearly 67 percent of female participants are concerned that they were not making enough to cover their basic expenses.  And more than 63 percent say that their personal finances have either remained unchanged or actually gotten worse in the five years since the Great Recession. Wages are clearly on the mind of Latino voters, who will play an important role in key races in this election cycle.

Wage Gap for Latinas in States with Key Hispanic Electorate
State Number of Latinas Working Full Time Media Wages for Latinas Media Wages for White, Non-Hispanic Men Annual Wage Gap Cents on the Dollar
California 1,425,264 $29,829 $68,464 $38,635 0.44
Texas 1,094,074 $26,021 $57,406 $31,385 0.45
Nevada 86,052 $27,552 $52,963 $25,411 0.52
Colorado 114,041 $30,156 $56,496 $26,340 0.53
Florida 581,460 $28,491 $48,864 $20,373 0.58

Source: NCLR selection from analysis by National Partnership for Women and Families of 2013U.S. Census Bureau data.

As you cast your ballot this November, show your support for your mothers, grandmothers, sisters and daughters who deserve to live in a country where their hard work is rewarded with fair compensation. Learn about where your candidates stand on gender pay discrimination and encourage them to get on board with the majority of the voters who believe that our lawmakers should act to close the wage gap for women and especially Latinas.

A Broken Immigration System Hurts Communities and Businesses

Hanging in the balance-01

By Laura Vazquez, Senior Immigration Legislative Analyst, NCLR 

Our EconomyWhen we talk about the need for President Obama to grant administrative relief to qualifying immigrants, we often focus on the families who lose cherished loved ones. But there is more to the story. The approximately 11 million aspiring Americans in our country are woven into the fabric of communities. Nearly 10 million have lived in the United States for five years or more. They are volunteers, breadwinners, and skilled workers.

Take, for example, the story of Benjamin Nuñez-Marquez, a 38-year-old man living and working in Orcas Island, Washington. His story was recently reported in the Seattle Times.

For 15 years, Benjamin was solely responsible for operating the antique circular saw at West Sound Lumber. His skills and knowledge were indispensable to running the mill—no one else knew how to operate the saw that he used to craft furniture and other goods. The company’s owner, Jack Helsell, considered Benjamin essential to his business’s success, as Benjamin did the same work that two men used to do, and he did it twice as fast. Benjamin was not only a reliable worker, he was also virtually irreplaceable. Before he came on, no sawyer had stayed on the job for longer than a year, given the tough, physical nature of the work.

In 2008, however, Benjamin ran afoul of immigration authorities while driving his sick and elderly neighbor to the hospital. Benjamin met his 80-year old neighbor Natalie White in 1998. In exchange for English lessons, he helped Natalie with odd jobs around the house and took care of her cats, dogs, goats, and guinea pigs. When Natalie suffered a stroke, she thought to call Benjamin first rather than dial 911. Benjamin drove her to the closest hospital and they encountered a Border Patrol checkpoint on the way, where he was apprehended.  He was detained, granted a hearing, and then ordered to be removed from the country.

Meanwhile, the Helsells worried if their business would survive. West Sound Lumber is a small, family-owned company that couldn’t afford to upgrade its saw, and even after recruiting for two years, the business could not find a replacement for Benjamin. The company wouldn’t have been the only business affected by Benjamin’s deportation. Local builders who depend on the mill’s lumber urged immigration authorities to release the skilled craftsman, writing that his loss would be disastrous for their businesses. Local artists also went to West Sound Lumber with special projects for Benjamin and the saw.

Advocacy Central Need Action8The Orcas Island community, like other communities across the country, rallied to make the case that deporting someone who is integrally linked to their community would be devastating and was not in the country’s best interest. The Helsell family, other local businesses and residents, elected officials, and local papers wrote hundreds of letters and made countless calls to U.S. Immigration and Customs Enforcement, urging the agency to release Benjamin.

The advocacy paid off.

This past May, Benjamin was granted a one-year stay of removal. Senator Patty Murray (D–Wash.) remarked: “As I told Homeland Security Secretary [Jeh] Johnson, Ben Nunez is exactly the type of person we should not be kicking out of this country. He’s a cherished friend and member of his community, he’s a hard worker who keeps the doors open at a small business, and he’s someone Americans should be proud to call their own.”

The United States is still struggling to recover from the Great Recession and it is incredibly poor policy to spend taxpayer dollars apprehending, detaining, and removing people like Benjamin, people who are integral to both our businesses and our communities. Misguided immigration policies don’t just tear families apart; these policies also impact the communities where aspiring Americans live and contribute. Their neighbors, pastors, teachers, and co-workers feel the effects of the broken immigration system and have advocated for Congress to act.

Since GOP leadership in the House of Representatives has failed to do so, President Obama must now do what is in the best interest of communities across the country.

Latinos Place Economy as Number-One Concern

Attend NCLR Economic Policy Workshops to Learn How You Can Help Build a Better Future

Jar of Money --- Image by © Royalty-Free/CorbisLatinos consistently rank the health of the economy as their primary concern, especially in the past few years as our country has slowly emerged from the Great Recession. Analysts at NCLR have designed workshops for the 2014 NCLR Annual Conference about critical economic policy issues: retirement security, housing finance, banking, workforce development, federal budget, and more. Our aim is to engage in a lively discussion with Conference attendees on these important policy topics that ultimately impact all of our pocketbooks.

We hope you are coming to Los Angeles to attend the NCLR Annual Conference and that you’re as excited as we are to participate in the workshops. We need your energy, feedback, and questions to have a real success. We also hope that you learn from the excellent speakers we have lined up to share the latest policy information with our community, and discover about ways to get involved in helping build a better future for our country. A poll of Latino voters from NCLR and Latino Decisions set to be released on Monday, July 21 finds that the economic crisis is indeed still very personal for Latino families.

Saturday, July 19, 2014

9:00–10:30 a.m.
Policy Workshop: Is Washington Working for the Latino Community? An Update from the 113th Congress

While the 113th Congress is frequently described as the most partisan and least effective Congress in history, recent bipartisan efforts to pass a budget, advance immigration reform, and overhaul our housing finance system suggest that there could be substantive progress on Latino priorities heading into the midterm elections and beyond. Hear from NCLR policy experts and Congressman Tony Cardenas’ Chief of Staff about what’s happening on the Hill and in the Obama administration to move a Latino policy agenda forward.

11:00 a.m.–noon
Affiliate Lounge Session: Take it to Washington, DC: Help Shape the 2015 Latino Economic Policy Agenda

Campaign representatives from the group Latinos United for a Fair Economy would like to hear from you regarding various economic issues of high importance to the Latino community, such as funding for education, job training, and infrastructure. Your feedback will help shape the economic policy priorities included in the National Hispanic Leadership Agenda’s 2015 Latino Economic Policy Agenda.

 

conferencebanners-04Sunday, July 20, 2014

9:00–10:30 a.m.
Health and Community Family and Wealth-Building Workshop: Ready? Set? Retire! Addressing Disparities in Latino Retirement Preparedness

Two-thirds of Latino workers lack access to a workplace retirement savings plan. This workshop will share information about how Latinos utilize retirement plans now, and explore how new retirement policy proposals may impact retirement readiness among Latinos.

3:30–5:00 p.m.
Town Hall: The State of the Economy: Giving Latinos a Fighting Chance

Five years after the financial crisis, Latinos still face significant financial challenges. This town hall will discuss policies impacting access to financial services for Latinos and new immigrants. Keynote address by Senator Elizabeth Warren.


Monday, July 21

9:00–10:30 a.m.
Policy Workshop: Building the Pipeline to Good Jobs

Too many graduates of workforce development programs feel powerless against common abuses in low-wage jobs. This workshop will explore promising approaches to empower workers to stand up for their rights and improve working conditions in key industries.