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U.S. Latino economic output grows to $3.6 trillion, new report finds

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2 months ago

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Miami Beach, Florida, Cafe Sazon, Cuban flag with seniors at table. 

Jeff Greenberg | Universal Images Group | Getty Images

The U.S. Latino economy grew by 13% from $3.2 trillion in 2021 to $3.6 trillion in 2022, according to a new report released Thursday by economic think tank Latino Donor Collaborative and Wells Fargo.

That would make the cohort the fifth-largest economy in the world — surpassing the annual output of India, the United Kingdom, France and Canada.

“There is no doubt that the U.S. Latino economy is a formidable force, characterized by strong GDP growth, significant population expansion, high workforce participation, and increased educational achievements,” Sol Trujillo, Latino Donor Collaborative chairman, said in the report.

“This is not a matter of diversity and inclusion; it is a critical business strategy,” Trujillo added.

The report is based on data from 2022, the most recent year for which information is publicly available. It 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 10 largest economies between 2017 and 2022, Latinos would be the second fastest-growing economy with a 4.6% annual average real growth rate, behind just China at 5.3%. The growth rate of the U.S. Latino gross domestic product, or GDP, is also 2.6 times faster than the rest of the U.S. economy.

Industry strength for Latinos remained steady in manufacturing, public administration, accommodation and food services, construction, and transportation.

By state, California led the way in Latino GDP in 2022 once again. Here’s a look at the top five states by Latino GDP, per 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 that have increased in price and costs for his business with recent inflation, in Las Vegas, Nevada on February 1, 2024. 

Patrick T. Fallon | AFP | Getty Images

Latino wealth soars

The Latino economic boom has also led to a wealth boom for the group.

Hispanic household wealth has tripled over the last decade, according to new data compiled by the Hispanic Wealth Project.

That is two years ahead of a goal set out by the nonprofit, after Latinos lost up to two-thirds of their median household wealth in the wake of the Great Recession. By 2022, the median net worth of Hispanic households reached $63,400 — 3.17 times higher than in 2013, when adjusting for inflation.

Increasing homeownership rates, rising home prices and a surge in Hispanic-owned businesses have all contributed to steady growth, the HPW reported.

However, a significant gap remains when the group is compared with non-Hispanic white households, which had a median net worth of $283,300 in 2022. Median net worth was $192,160 for the general population.

“The U.S. Latino cohort is essential to our country’s future,” said Trujillo.

Latino economy shows no sign of slowing

The LDC also set a forecast for the U.S. Latino economy through 2029. It shows the cohort’s economic output will surpass Japan’s by 2024 and Germany’s by 2027, based on national GDP forecasts from the International Monetary Fund.

A significant part of that, Trujillo said, is due to the group’s population growth rate. “U.S. Latino population growth is nearly ubiquitous across the country.”

Latino economic growth is also expanding at a faster rate than that of non-Latinos in states such as Colorado, Washington and Georgia. Between 2021 and 2022, the U.S. Latino population increased by 1.65%, while the non-Latino population grew by just 0.08%. This growth has translated to the Latino population being significantly younger than its peers, with a large share of Latinos who have yet to enter the labor market.

As a result, the U.S. economy is increasingly reliant on U.S. Latinos to replenish its working-age population, Trujillo said. “A young Latino in the U.S. turns 18 every thirty seconds.”

“Leveraging the unique and powerful opportunities presented by the U.S. Latino market 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 corporate America as well as in the public, media and entertainment sectors.

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UK economy ekes out 0.1% growth, below expectations

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Bank of England in the City of London on 6th November 2024 in London, United Kingdom. The City of London is a city, ceremonial county and local government district that contains the primary central business district CBD of London. The City of London is widely referred to simply as the City is also colloquially known as the Square Mile. (photo by Mike Kemp/In Pictures via Getty Images)

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The U.K. economy expanded by 0.1% in the third quarter of the year, the Office for National Statistics said Friday.

That was below the expectations of economists polled by Reuters who forecast 0.2% gross domestic product growth on the previous three months of the year.

It comes after inflation in the U.K. fell sharply to 1.7% in September, dipping below the Bank of England’s 2% target for the first time since April 2021. The fall in inflation helped pave the way for the central bank to cut rates by 25 basis points on Nov. 7, bringing its key rate to 4.75%.

The Bank of England said last week it expects the Labour Government’s tax-raising budget to boost GDP by 0.75 percentage points in a year’s time. Policymakers also noted that the government’s fiscal plan had led to an increase in their inflation forecasts.

The outcome of the recent U.S. election has fostered much uncertainty about the global economic impact of another term from President-elect Donald Trump. While Trump’s proposed tariffs are expected to be widely inflationary and hit the European economy hard, some analysts have said such measures could provide opportunities for the British economy.

Bank of England Governor Andrew Bailey gave little away last week on the bank’s views of Trump’s tariff agenda, but he did reference risks around global fragmentation.

“Let’s wait and see where things get to. I’m not going to prejudge what might happen, what might not happen,” he told reporters during a press briefing.

This is a breaking news story. Please refresh for updates.

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