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Hispanic Buying Power

“Buying power is the total personal income of residents that is available, after taxes, for spending on virtually everything that they buy, but it does not include dollars that are borrowed or that were saved in previous years.” – University of Georgia Selig Center for Economic Growth

United States Hispanic owned small businesses are outpacing the growth of all other small businesses in the U.S. by a ratio of 3 to 1. Hispanic buying power in the United States is more than $1.3 trillion and both Texas and California account for 34% of the Hispanic buying power.

In the United States, Hispanic buying power has been increasing; over time in 1990 it was $212 billion, increasing to $490 billion in 2000, $686 billion in 2004, $992 billion in 2009 and about $1.38 trillion in 2013.

From 1990 to 2009 there was a 347% increase in Hispanic buying power. Hispanics now possess 9% of the buying power in the United States, up from 5.2% in 1990. Also, between 1990 and 2009, Hispanic population increased by 121%, as compared to a 23% gain in total population.

Several contributing factors have generated this rise in economic buying power. These include better employment opportunities, increased immigration, higher paying managerial and professional jobs, higher education levels, household characteristics and accumulation of wealth.

The increase in Hispanic business owners is also fueling the increase in buying power. Between 1997 and 2002, the number of Hispanic companies grew by 31%, significantly greater growth than the overall 10% growth of businesses in the United States.

What about Austin?

•In Austin, annual Hispanic buying power is $9.4 billion

•Austin has over 14,000 Hispanic owned businesses

•Most Hispanics in Austin earn between $35,000 and $75,000 per year

Predictions and Selig Center for Economic Growth:

“Latinos will change the profile of American society over the next four decades. The Hispanic population will grow much quicker than other population segments, and Hispanic consumers will represent an increasing percentage of the American consumer base.” -Tatjana Meerman, publisher; Packaged Facts research company

•Hispanics falling into Generation-Y, current ages 18-29, and Generation-X, current ages 30-44, will have the majority of financial influence as they represent over 60% of the Hispanic buying power

•The Hispanic community’s buying power is projected to be the world’s ninth biggest economy – larger than the Gross National Product (GNP) of Brazil, Spain or Mexico

•By 2013 it is anticipated that one out of every six people in the United States will be Hispanic

•By 2050, Hispanics will account for 30% of all Americans and their numbers will be greater than the entire United States population in 1940

{Sources:
Latino Business Review, 2008
Pew Hispanic Center
Synovate and Scarborough Research
Packaged Facts Market Research, 2008
Hispanic Association on Corporate Responsibility
Selig Center for Economic Growth
2006 American Community Survey
Hispanic Business.com}

Visit the Texas Office of the Governor Economic Development site, where you will find different links that present information on Hispanic-owned businesses in the United States.