Hispanic and Asian Buying Power

Hispanic and Asian Buying Power

SELIG CENTER REPORT:

The report notes that the heavy concentration of Hispanics in construction and hospitality industries and the concentration of Asians in the manufacture of durable goods such as automobiles made them particularly vulnerable to job losses during the 2007-2009 recession.

From its peak in 2008, the number of employed Hispanics has dropped by 624,000, which signifies the loss of nearly 13 percent of the new jobs held by Hispanics created in the previous eight and a half years.

During the same time period, the number of employed Asians dropped by 288,000, which signifies a loss of more than 20 percent of the new jobs held by Asians created in the previous eight and a half years.

Yet Humphreys said that the outlook for buying power in both groups is positive. Hispanic buying power is expected to grow 50 percent in the next five years, from $1 trillion in 2010 to $1.5 trillion in 2015. The report notes that the rate of growth in Hispanic buying power tops all other racial and ethnic groups as well as the rate of growth in overall buying power.

Favorable demographic forces are primarily responsible for the anticipated growth in Hispanic buying power, Humphreys notes. Population growth is expected to continue, and the relatively young Hispanic population means that proportionally more young Hispanics are starting their careers and moving up their career ladders. Increased entrepreneurial activity and a rising level of educational attainment also illustrate the upward mobility of Hispanics, the report finds.

The Selig Center report notes that the Asian population is also growing faster than the total population and is relatively young. As a group, Asians are much better educated than the average American and therefore hold many top-level jobs in management, professional and scientific specialties. Over the next five years, Asian buying power is expected to grow 42 percent, from $544 billion in 2010 to $775 billion in 2015.

“The Hispanic and Asian markets in particular are expected to grow at an exceptional rate,” Humphreys said. “For businesses, the message is that you don’t always have to look overseas to find fast-paced growth.”

Humphreys notes that while Hispanic and Asian populations are still geographically concentrated in border states and traditional ports of entry, such as New York and Florida, their buying power is reaching a critical mass in several states. In Georgia, for instance, Hispanics have $17 billion in buying power. The share of buying power controlled by Asian consumers rose in nearly every state during the past decade.