Las Vegas Sun

March 28, 2024

Ethnicity:

Report: Nevada Hispanics increasingly helping drive state’s economy

The Hispanic community is a growing force driving Nevada’s economy, boosting demand for goods, services and homes.

While the community’s full economic impact is difficult to gauge -- in part, due to underreporting of income in U.S. Census Bureau data -- a study released last week by the Partnership for a New American Economy gives a glimpse.

The partnership, a coalition of business groups and mayors advocating for immigration reform, says Hispanics in Nevada accounted for 16 percent of the state’s spending power in 2013. They contributed almost as much in tax revenue.

The group’s report came on the heels of Pew Research Center data showing that Hispanics were the first ethnic group to experience an increase in median real incomes since the economic crisis of 2008, and that their median household income grew by 3.5 percent in 2013 compared to 2012 -- while the income levels of whites, blacks and Asians remained virtually unchanged.

"The demographic future of our country is clear, and Hispanics will make up an increasingly large portion of the U.S. workforce over the coming generation,” said Jeremy Robbins, the group’s executive director. “The economic megaphone of the Hispanic community is only going to get louder over the coming years."

The national study says Hispanics, both native and foreign-born, spend about $605 billion -- or one out of every 10 dollars -- in the country. Nevada was one of nine states listed in the study for having one of the most economically influential Latino populations.

Here’s what researchers learned about the Silver State:

Latinos are taking a big slice of the state’s income pie.

In Nevada, Hispanics had more than $8 billion in after-tax income in 2013, accounting for 16 percent of the state’s spending power. Although their share of income is low in comparison to the size of their community -- they make up 28 percent of the population -- they make up a ballooning proportion of the working-age population in the U.S. That being the case, they’re on a trajectory to wield more and more economic clout.

“The Hispanic population is growing,” said Sylvia Manzano, an analyst with polling firm Latino decisions. “We know that they’re younger, which means they’re going to have families and they’re going to spend more on durable goods.”

Hispanics greatly help fund government.

Latinos in Nevada contributed $2.3 billion in federal, state and local tax revenues in 2013, nearly 15 percent of the revenue paid by all Nevadans.

Given that earnings and tax contributions for this minority group is so large, Latinos play a big role in funding Social Security and Medicare programs. They contributed a total of $1.6 billion in funding for both programs, according to the partnership’s study.

And earlier research by the group shows that Hispanics, in particular those that are foreign-born, contribute more to funding services than they actually use.

The study’s results are likely highly conservative.

Because of income underreporting in the Census Bureau’s American Communities Survey as well as limitations in survey sampling, the partnership estimates the true economic impact of Latinos is higher than the study suggests.

An earlier study from the Institute for Research on Poverty at the University of Wisconsin reported that at least half of families with incomes lower than $15,000 had underreported their income by more than 20 percent on Census counts (and many people in this low-income group are Latino).

"While the report is important and asks the right questions, we should look at the conclusions and consider all of the economic burdens that the Latino population bears," said Jeremy Aguero, a Las Vegas-based economic analyst. He noted that Hispanics, for instance, generally earn less money than whites.

Other studies suggest Latino spending packs a far bigger punch: A report released last year by the Selig Center for Economic Growth at the University of Georgia estimated Hispanic purchasing power at $1.2 trillion per year nationwide. That study focuses not only on income earned in the workplace, but also takes into account earnings from other sources such as rental income, nonprofit-related earnings and pension plans.

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