The post-recession Hispanic consumer is a growing force to be reckoned with.
Who’s the most confident consumer demographic? A recent survey from the Pew Research Center on Hispanic trends found Latinos in America are unusually optimistic about the state of their own personal finances. In fact, their outlook far outpaces the general public’s.
A full 81% of Hispanics believe that their family’s financial situation will improve next year, compared to just 61% of the general public. Additionally, 40% of the US Hispanic population believes their own personal finances are in good shape, nearly even with the 43% of the general public that feels the same. Just 23% of Hispanics agreed with this statement in 2008.
It’s a population with good reason to be optimistic, according to Ana Valdez, executive director at the Latino Donor Collaborative. “People from Latin America come here with absolutely nothing,” said Valdez. “When you get somebody here with absolutely no education and the second generation is going to college, that’s a tremendous growth.”
Beyond optimism, there are signs of the rising financial health of the Hispanic-American consumer. The Hispanic Wealth Project’s 2016 report found that Latinos are driving homeownership in America, responsible for 69% of net growth in 2015. Hispanic-owned business have also more than doubled since 2002, with 4.1 million currently in operation. However, unemployment remains slightly higher among the Hispanic population, while median household income trails the general public by roughly $10,000.
Overall, though, the signs are clear that the Hispanic consumer is on the rise. According to a May 2016 analysis from Morgan Stanley, Hispanics will see a 1.6% increase in purchasing power over the next five years. That’s more than any other demographic—including millennials (0.6%). The Hispanic population is expected to account for 50% of the US population growth over the next five years.
Looking forward, it’s a wise move for marketers to keep an eye on this rapidly growing demographic. “People have a misconception that Latinos are mostly recent immigrants. But the truth is, 85% are documented,” said Valdez. “Some of them have also been here since 300 years ago. That market has been very neglected.”