Hispanics are the fastest-growing contributors to the United States economy, are quick to join the labor market and are responsible for $3.2 trillion of the nation’s gross domestic product, according to a new report authored by researchers from Arizona State University.
With age, population and purchasing power in their favor, Latinos are fundamentally reshaping the future of the U.S. economy through growth, workforce participation and educational attainment.
These are some highlights of the 2023 Latino Donor Collaborative (LDC) U.S. Latino GDP Report prepared by researchers from the L. William Seidman Research Institute at ASU’s W. P. Carey School of Business.
“The 2023 LDC U.S. Latino GDP Report not only underscores the incontestable economic prowess of the U.S. Latino community but also foretells the future trajectory of our nation,” Arizona State University President Michael M. Crow said. “The data collected by the Seidman Research Institute offers insight that reveals an unprecedented opportunity for businesses, policymakers, and educational institutions to adapt, innovate and prosper with this demographic. At ASU, we look forward to harnessing these insights to further our mission of excellence and societal impact.”
The sixth annual LDC report, co-authored by Dennis Hoffman and José Jurado of the L. William Seidman Research Institute, is predominantly focused on different measures of contribution of the Latino cohort to the U.S. economy and how they compare with other economies around the world.
“The data from the 2023 LDC U.S. Latino GDP Report clearly show the power of the Latino demographic within the broader U.S. and global economy,” said Hoffman, director of the Seidman Research Institute and director of the Office of the University Economist. “The numbers detailed in this report show not just the incredible impact Latinos already have on the U.S. market but also the likelihood of economic growth attributable to the Latino community. Businesses must seek to understand the impact the community has on their workforces and customer bases or be left behind.”
The Sept. 27 release of the report kicked off the 2023 L’ATTITUDE Conference in Florida. Every year, the conference provides a national platform showcasing the economic leadership of U.S. Latinos in business, media, politics, science and technology.
Hoffman and Jurado were present and gave an overview of their findings.
“The annual L’ATTITUDE conference in Miami serves as an excellent platform for delivering unbiased, actionable data to key stakeholders, policymakers, business executives, and the public,” said Jurado, a principal investigator and research economist for the Seidman Institute. “This year’s report introduces, for the first time, data on the size of the Latino economies in each U.S. state. We hope this new information will improve resource allocation and public policy decisions.”
Highlights from the report:
- U.S. Latino gross domestic product is now valued at $3.2 trillion.
- U.S. Latino purchasing power is measured at $3.4 trillion.
- In 2021, Latino income in the U.S. amounted to $2.5 trillion and grew 4.7% compared with 1.9% for non-Latinos.
- Measured by GDP, the U.S. Latino economy would rank as the fifth largest in the world.
- Its growth comes from its youth, population growth, labor force participation and educational attainment.
For the first time, the report provided a breakdown of the Latino economy across all states in the U.S. Some of the largest economies exist in California, Texas, Florida, New York, Illinois, New Jersey and Arizona. Latinos in the Grand Canyon State contribute $72.6 billion to the state’s economy. The Latino economy in California alone — $682.4 billion — is comparable to the world’s 21st -largest economy, sandwiched between Poland and Switzerland.
According to the report, Latinos’ economic influence continues to expand rapidly across all industries. Their workforce impact is most felt in public administration, manufacturing, real estate and rental leasing, health care and social assistance, and wholesale and retail trade.
“Essentially, in many regions of the U.S., a Latino worker is more often than not filling a new job vacancy,” said Sol Trujillo, co-founder and chairman of the board of the Latino Donor Collaborative. “At a time when our nation is experiencing tight labor markets and employment gaps, Latinos have provided the human capital needed to keep the economy running.”
The Latino workforce is also significantly younger than other demographic groups, with the majority falling under the age of 25 and the most common age range being 10 to 14 years, compared with 60 to 64 years among non-Latinos.
“When you read the new LDC Latino GDP Report, it is truly striking how vital the Latino cohort is for the U.S. economy,” says Ohad Kadan, Charles J. Robel Dean and W. P. Carey Distinguished Chair. “Business leaders around the nation should internalize the growth of the Latino economic power for the success of their businesses. It is equally vital for academic institutions to recognize and support Latino students seeking higher education. Through our dual commitment to access and excellence, ASU and the W. P. Carey School of Business fulfill that call.”
Latinos are also advancing when it comes to education. The number of individuals holding a bachelor’s degree or higher increased by 6.8% annually between 2011 and 2021, compared with 2.8% for non-Latinos, according to the report. ASU is seeing those numbers increase in real-time.
One in four ASU students identifies as Hispanic or Latino, totaling more than 31,000 students. Those growing numbers follow a year where ASU was recognized as a Hispanic-Serving Institution, earned a second Seal of Excelencia by Excelencia in Education and joined the Presidents for Latino Student Success.
“In this past decade, ASU graduated more than 50,000 students from Hispanic/Latino backgrounds — a massive 175% increase from the previous decade and an example of the impact of Hispanic/Latinos in our workforce,” said Nancy Gonzales, ASU executive vice president and university provost,
“ASU is a major engine of social mobility and economic impact for Arizona. We are proud to contribute a prepared workforce of students from all backgrounds to Arizona,” Gonzales said. “In particular, ASU’s Hispanic/Latino graduates have strong ties to their home communities within the state and will be vital to shaping a prosperous future for Arizona.”