June 19, 2014

Latino Jobs Growth Driven by U.S. Born

Chapter 2: The Jobs Recovery for Hispanics

By one measure, Hispanic workers have fared well in the recovery. The number of Hispanics with jobs increased from 20 million in the fourth quarter of 2009 to 22.7 million in the fourth quarter of 2013. The increase more than made up for the 0.4 million jobs lost by Hispanics during the recession.

However, the strong jobs recovery for Hispanics is more about demographics than improving economic conditions. The Hispanic working-age population is increasing rapidly, by 4 million from the fourth quarter of 2009 to the fourth quarter of 2013. Consequently, even with the sizable number of new jobs, the Hispanic employment rate has risen by only one percentage point during the recovery, from 59% in 2009 to 60% in 2013. That is significantly less than the 64.3% employment rate at the start of the recession in 2007.

Employment Status of Hispanics, Fourth Quarter 2007 to Fourth Quarter 2013

Unemployment among Hispanics rose sharply in the recession. The number of unemployed Hispanics increased from 1.3 million in the fourth quarter of 2007 to 2.9 million in the fourth quarter of 2009, and the unemployment rate for Hispanics jumped from 5.9% to 12.7%. Since 2009, the number of unemployed Hispanics has fallen to 2.2 million, a decrease of 0.7 million, and the unemployment rate has eased down to 8.8% in the fourth quarter of 2013. However, the unemployment rate for Hispanics is still about three percentage points higher than the rate prior to the onset of the recession.

U.S.-born Hispanics to the Forefront

The overall gain in employment for Hispanics conceals a significant disparity in the trends for U.S.-born and foreign-born workers. The vast majority of jobs gained from 2009 to 2013—2.3 million out of 2.8 million—was secured by U.S.-born Hispanics. Meanwhile, the roughly 450,000 new jobs acquired by Hispanic immigrants date to the first two years of the recovery, from 2009 to 2011. Since 2011, the employment of Hispanic immigrants has been at a standstill.

Employment Status of Hispanics, by Nativity, Fourth Quarter 2007 to Fourth Quarter 2013

Once again, the disparity in jobs gained among Latinos is explained by population change in recent years. The working-age population of U.S.-born Latinos swelled 21.9% from the fourth quarter of 2009 to the fourth quarter of 2013. Meanwhile, the Latino immigrant working-age population increased by only 2.2% (see Appendix B for the population data). Previous research by the Pew Research Center found that the population of unauthorized immigrants in the U.S., which is mostly Latino, peaked in 2007.10

Immigrants Are a Declining Share of Hispanic Workers Since the Start of the RecessionBecause of these demographic changes, immigrants no longer account for the majority of Hispanic employment, a status they held for about two decades. The decline in the immigrant share has been fairly rapid, from 55% in the fourth quarter of 2007 to 49.7% in the fourth quarter of 2013.11 Because the U.S.-born Hispanic population is growing rapidly—and accounting for most of the growth in the Hispanic population—it is likely that the U.S. born will continue to be the majority of Latino workers unless the economic recovery triggers a new, rising tide of immigration.

In other respects, the experiences of U.S.-born and foreign-born Latinos have been similar through the recession and the recovery. Both experienced a sharp drop in the employment rate from the fourth quarter of 2007 to the fourth quarter of 2009, and both have failed to recoup the loss in its entirety through the end of 2013. For U.S.-born Latinos, the employment rate fell from 61.4% in 2007 to 56.8% in 2013, and for Latino immigrants the rate is down from 67% in 2007 to 63.7% in 2013.

The unemployment rates for U.S.-born and immigrant Latinos also remain higher than their levels in late 2007. For U.S.-born Latinos, the unemployment rate increased from 6.8% to 13.8% during the recession and retreated only to 10.3% by the end of 2013. For Latino immigrants, the unemployment rate also more than doubled in the recession, from 5.2% in the fourth quarter of 2007 to 11.8% in the fourth quarter of 2009. It had fallen to 7.2% by the end of 2013. The somewhat sharper drop in the unemployment rate for Latino immigrants during the recovery may be the result of “selective attrition,” i.e., those with dim job prospects in the U.S. may have returned to their country of origin or not entered the U.S. in the first place.12

  1. Passel and Cohn (2010), Passel, Cohn and Gonzalez-Barrera (2012, 2013) and Krogstad and Lopez (2014). Unpublished analysis by the Center finds that the Latino immigrant working-age population increased faster than the U.S.-born population from 1995 to 2007, at an annual average rate of 4.6% compared with 3.8%. However, the opposite is true from 2008 to 2013 with the U.S.-born population increasing at an annual average rate of 5% and the immigrant working-age population increasing at an annual average rate of 1.3%. These estimates are derived from the CPS Annual Social and Economic Supplement conducted in March of each year. The CPS started collecting monthly data on the nativity of a respondent in 1995.
  2. The estimate for the fourth quarter of 2013—49.7%—is not statistically significantly different from 50%. An estimate for the first quarter of 2014 shows that the share of immigrants in Latino employment is 48.8%, statistically significantly less than 50%. However, the estimate for the first quarter of 2014 should not be directly compared with the estimate for the fourth quarter of 2013 because of seasonal fluctuations.
  3. Related to this is the fact that the median age among working-age Latino immigrants has risen quickly in recent years, from 37.6 in 2007 to 41.3 in 2013, a sign that the inflow of younger workers has slowed since the recession started. The age estimates are unpublished Pew Research Center estimates from the CPS Annual Social and Economic Supplement files.