October 2, 2008

Sharp Decline in Income for Non-Citizen Immigrant Households, 2006-2007

I. Overview

The current economic slowdown has taken a far greater toll on non-citizen immigrants than it has on the United States population as a whole, according to a Pew Hispanic Center analysis of new Census Bureau data. The median annual income of non-citizen immigrant households—a group that accounts for 7% of all U.S. households and 52% of all immigrant households—fell 7.3% from 2006 to 2007. In contrast, the median annual income of all U.S. households increased 1.3% during the same period.1

The characteristics of immigrant heads of households who are not U.S. citizens help explain the vulnerability of this population to the latest economic slowdown. Most arrived in the U.S. in recent years with only a high school education or less. Many are employed in blue-collar production and construction occupations or lower-rung occupations in the service sector. The majority (56%) of non-citizen households are Hispanic. And nearly half (45%) of non-citizen immigrant households are headed by an undocumented immigrant.2

The incomes of non-citizen households have displayed great instability in the past decade—increasing rapidly in economic expansions but falling just as suddenly during economic slowdowns. These fluctuations have been far greater than the average for all U.S. households. For example, the latest turn in the economic fortunes of non-citizen households represents a sharp turnaround from the preceding year. Incomes of non-citizen households in 2006 were 4.1% higher than income levels in 2005. Incomes of all U.S. households, meanwhile, had increased 0.7%.

This report outlines recent trends in the incomes of non-citizen households and identifies who among them experienced the largest losses from 2006 to 2007. Of a total 116.8 million households in the U.S., 15.7 million are headed by immigrants. The majority of these immigrant households—8.2 million—are headed by immigrants who are not U.S. citizens.3 The data for the analysis are derived from the Current Population Survey, a monthly survey of approximately 55,000 U.S. households conducted by the Census Bureau for the Bureau of Labor Statistics.4

Less-skilled workers in blue-collar occupations can benefit tremendously from tight labor markets but are also the most susceptible to economic downturns.5 In previous decades, these fluctuations played out in the ups and downs of employment throughout the goods-producing sector generally. But in recent times, the economic fate of Hispanic immigrant workers has been more specifically tied to the housing and construction sectors. Thus, these workers enjoyed significant economic gains during the construction boom of the early part of this decade, only to experience a sharp decline starting in 2006. (Kochhar, 2008)

Incomes have fallen most for non-citizen households headed by Hispanics; immigrants from Mexico, other Latin American countries and the Caribbean; the most recently arrived; males, either unmarried or with no spouse present; those without a high school education; and those in construction, production or service occupations, according to the Pew Hispanic Center analysis of Census Bureau data. Those characteristics are also descriptive of most of the undocumented migrant population in the U.S.6 (Passel, 2006)

About the Report

This report outlines recent trends in the incomes of non-citizen immigrant households in the U.S. and identifies who among them experienced the largest losses from 2006 to 2007. The report includes the analysis of estimates of household income from the U.S. Census Bureau and the Pew Hispanic Center’s estimates of the income of non-citizen households by principal characteristics. The analysis is based on data from the Current Population Survey, a monthly survey of about 55,000 U.S. households conducted by the Census Bureau for the Bureau of Labor Statistics. The estimates in this report are from the surveys conducted in March which typically feature a larger sample of households.

A Note on Terminology

The terms “Latino” and “Hispanic” are used interchangeably in this report, as are the terms “foreign born” and “immigrant.”

Foreign-born refers to an individual who is born outside of the United States, Puerto Rico or other U.S. territories and whose parents are not U.S. citizens.

Recommended Citation

Kochhar, Rakesh. “Sharp Decline in Income for Non-Citizen Immigrant Households, 2006-2007,” Pew Hispanic Center, Washington, D.C. (October 2, 2008).

  1. For the Census Bureau estimates, see DeNavas-Walt, Carmen, Bernadette D. Proctor and Jessica C. Smith (2008).
  2. Unpublished Pew Hispanic Center estimates.
  3. The estimates of the numbers of households are from the U.S. Census Bureau and are based on data from the March 2008 Current Population Survey.
  4. The estimates in this report are from the Current Population Surveys conducted in March. The surveys in March typically feature a larger sample of households. Additional details are available at: http://www.census.gov/apsd/techdoc/cps/cpsmar08.pdf.
  5. For example, see Gardner (1994), Council of Economic Advisers (1999) and Freeman and Rodgers (2005).
  6. About 25% of undocumented household heads in 2007 were males, either unmarried or with no spouse present, according to unpublished Pew Hispanic Center tabulations. That share is higher than the 18% of all foreign-born heads of households who were males, either unmarried or with no spouse present.