One of the major characteristics the Latino relationship to our economy is the entrepreneurship nature of the community. This is especially true of Latino immigrants.
When we think of the road to economic success, it is conventional to look toward getting an education before starting a business and joining the work force as a professional. In many quarters, this is seen as the way to reach the American Dream.
What happens however, when poverty and little in education and job opportunities form the roots of an economic condition? This describes the nature of the Latino economic experience, especially those from an immigrant tradition as well as that of more recent arrivals.
Latinos are hard working people by tradition and temperament. So, when there are no jobs to be had, you make your own by starting a business using the limited resources available within the family.
This type of entrepreneurship is what the Latino community brings to the economic table and it has generated powerful results. “If U.S. Latinos were their own nation, they would have the world’s seventh-largest gross domestic product (GDP), at $2.13 Trillion, according to a report by the Latino Donor Collaborative.”
Latinos are the driving force of the American economy as its GDP is growing 70 percent faster than the rest of the county. Also, it is expected that this year the purchasing power of the Latino community will top “$1.7 trillion.”
“In 2013, Hispanic households contributed over $1 billion to Colorado tax revenues and over $2 billion toward U.S.. tax revenues, totaling more than $3 billion in tax contributions.” 1.1 billion of that was generated by foreign-born Latinos.
Aside from demographics that show Latinos as the fastest growing population in the country and Forbes projecting that “by 2025, the increase in employed Hispanic labor could contribute more to U.S. GDP growth than non-Hispanic labor,” it is entrepreneurship that is winning the day. “Latino entrepreneurs are starting companies 50 times faster than any other demographic group according to Forbes.”
A major challenge for Latinos that own 12 percent of businesses in the United States however, is access to capital. Once that is solved, Latinos will most likely become the face of the American economy.
But this is easier said than done as there are cultural characteristics that may stand in the way. Latino businesses, for example, tend to depend heavily on family resources and, in this regard, one should also note that the decision for many to start a business in their original community or come to America was as a replacement for scarce jobs.
The notion of seeing a business as a replacement for a job tends to limit the growth horizon for Latino business owners. For Latino immigrants especially, there is also the tendency to grow a business only to the extent that all members of the family are employed.
In Latin America, I have also seen corporations stop growing because families run out of members that can assume executive positions. This tendency to trust only family members with a business is generally foreign to Americans.
These cultural business characteristics however, do not seem to be part of the Latino Millennial generation. Although they may share the experience of poverty and immigrant family life with their parents, their world view has a lot more in common with their peers across racial and ethnic lines.
The Latino economic story has been long, difficult and full of obstacles. With continued hard work however, the next chapter is full of promise.