Coronavirus Economic Downturn Has Hit Latinos Especially Hard

Jens Manuel Krogstad and Mark Hugo Lopez of the Pew Research Center

The coronavirus outbreak has significantly harmed the finances of U.S. Hispanics. As the nation’s economy contracted at a record rate in recent months, the group’s unemployment rate rose sharply, particularly among Hispanic women, and remains higher among Hispanic workers than U.S. workers overall. With Hispanic households absorbing lost jobs and wages, many have said they may not be able to pay their bills. Yet even before the outbreak, Hispanics were concerned about their economic situation despite near record low levels of unemployment through the end of 2019.

As the United States locked down amid COVID-19, the unemployment rate for Hispanics increased from 4.8% in February to a peak of 18.5% in April before dropping to 14.5% in June, nonseasonally adjusted.1This exceeds levels from the Great Recession of 2007-2009, when the unemployment rate peaked at 13.9% in January 2010. Hispanic women have experienced an especially steep rise in their unemployment rate, which jumped from 5.5% to 20.5% between February and April 2020.2 By comparison, the unemployment rate for Hispanic men rose from 4.3% to 16.9% during this time. In June, the unemployment rate of U.S.-born Hispanics (15.3%) was higher than that of foreign-born Hispanics (13.5%), after the rates for both groups peaked at more than 18% in April.

Latinos say they have had a hard time making ends meet during the outbreak, according to Pew Research Center surveys. About six-in-ten Latinos (59%) in May said they live in households that have experienced job losses or pay cuts due to the coronavirus outbreak, with a far lower share of U.S. adults (43%) saying the same. As Latino incomes dwindled, most in April said they do not have emergency funds to cover three months of expenses, and half or more said they worry daily or nearly every day about financial issues like paying their bills, the amount of debt they carry and the cost of health care.3

Strong majority of Latinos say ‘the worst is yet to come’ in coronavirus outbreakLatinos have a bleaker view than the U.S. overall about the coronavirus, according to a June survey of U.S. adults. Among Latinos, 70% say the worst of the problems due to the coronavirus outbreak are still to come, and a similar share said so in an April survey. By comparison, 40% of U.S. adults say the worst of the coronavirus is behind us, up from 26% in April.

Hispanics have a grim view of nation’s economy, but about half expect conditions to improve in the next yearReflecting national trends, Hispanics also hold grim views of the economy, with only 18% rating U.S. economic conditions as excellent or good in June, down from 49% in January. Yet some Hispanics express optimism about the economy’s future. About half of Hispanics (48%) say they expect U.S. economic conditions to be better a year from now, with smaller shares saying they expect conditions to be about the same (28%) or worse (25%). In January, a lower share of Hispanics (35%) said they expected U.S. economic conditions to be better a year from now, while 41% expected them to be about the same and 23% expected them to be worse.

While Americans overall are deeply unhappy with the nation’s direction, satisfaction has dropped more among U.S. adults than Hispanic adults. In June, more Hispanics (20%) than Americans overall (12%) said they were satisfied with how things are going in the country, down from 29% and 31% in April, respectively.

As for the economic prospects of future generations, Hispanics have grown more optimistic about their prospects, though it’s still a minority that hold this view. About one-in-four Hispanics (26%) said life will be better for future generations of Americans, according to the June survey, up from 16% in September 2019.

Hispanics support broad set of proposals for economic aid due to coronavirus

Three-quarters of Latinos say more COVID-19 economic aid will be neededHispanics say the coronavirus outbreak is among the most serious issue facing the nation, with 70% saying it is very big problem, somewhat comparable with the 60% who said unemployment, according to the June survey. Lower shares of U.S. adults overall said the same about the coronavirus outbreak (58%) and unemployment (50%).

About three-quarters of Latinos (78%) say it will be necessary for Congress to pass another economic relief bill in addition to the $2 trillion economic assistance package passed by Congress in March and signed by President Donald Trump.

Large majority of Latinos support providing economic aid to businesses and individuals affected by coronavirusWhen it comes to policies to address economic problems resulting from the coronavirus outbreak, large majorities of Latinos favor every option presented: 90% support preventing evictions and foreclosures on renters and homeowners who have lost jobs or income; 88% support providing financial assistance to state and local governments; 86% support providing additional tax cuts and loans to businesses that keep workers on payroll; 72% support extending the $600-per-week increase in unemployment benefits beyond July 31; and 67% support temporarily cutting workers’ payroll taxes that go toward Social Security and Medicare. U.S. adults support assistance that prevents evictions and foreclosures for individuals (88%) and provides tax cuts and loans for businesses (88%) at similar levels as Hispanics. By contrast, fewer Americans overall favor providing financial assistance for state and local governments (76%), extending unemployment benefits (60%) and cutting workers’ payroll taxes (53%).

Latinos generally favor a more active government. A strong majority (74%) said government should do more to solve problems, while 22% said government is doing too many things that are better left to business or individuals, according to a December survey of U.S. Latinos. By comparison, 55% of U.S. adults in a September 2019 survey said government should do more to solve problems.

Before coronavirus, Latinos said immigration and the economy were the most important problems facing the U.S.

Even before the coronavirus outbreak, Hispanics found themselves on unsteady financial ground, despite near record low levels of unemployment. The Great Recession hit Hispanics particularly hard, and households saw significant declines in wealth and income. The economic recovery was uneven, with some groups faring better than others. By 2017, the median household income for Hispanic immigrants had returned to and exceeded pre-recession levels, while those for the U.S. born still lagged pre-recession levels.

Before coronavirus, Hispanics cited immigration and the economy as nation’s most important problemsWhen asked about the most important problem facing the U.S., Hispanics most often cited issues related to immigration (18%) and the economy (17%), according to a December survey of Latino adults. Smaller shares said race relations or racism (10%), health care (7%), dissatisfaction with government or politics (6%), crime (6%), political polarization or national divisions (5%), gun control (5%) and President Donald Trump (5%).

While Hispanic Democrats and Hispanic Republicans both cited immigration and the economy among the most important problems facing the nation, their views differed on Trump. For Hispanic Democrats, Trump (8%) is cited about as often as race relations and racism (11%) as the most important problem facing the country. By contrast, far lower shares of Hispanic Republicans cited Trump (2%) as the nation’s top problem.

Before coronavirus, most Latinos viewed their personal finances in a more negative than positive light

Before coronavirus, most Hispanics said their personal finances were in only fair or poor shapeIn December 2019, about two-thirds of Hispanics (64%) rated their personal financial situation only fair (45%) or poor (20%), compared with about a third who said good (31%) or excellent (4%).4 The share who rated their finances in only fair or poor shape is comparable with the 66% of Hispanics who said so in September 2018, and up from 59% in November 2015.

Latino Democrats and Republicans hold substantially different views. A majority of Democrats (69%) said their financial situation is in only fair or poor shape, compared with about half of Republicans (53%). Latino views also differed by educational attainment, with strong majorities of those who had not completed high school (73%) and high school graduates (68%) saying their finances were in only fair or poor shape, compared with 57% of those with some college education.

Younger Hispanics tended to give their finances lower marks than older Hispanics, though the differences were relatively modest. About two-thirds of Hispanics (68%) ages 18 to 29 said their personal financial situation was in only fair or poor shape, compared with 60% of those ages 50 and older.

Before COVID-19, fewer than half of Hispanics said their children will be better off financially than they areFewer than half of Hispanics (46%) said their children will one day be better off financially than they are, according to the December survey.

More than half of immigrants (54%) said their children will be better off financially than they are, compared with 39% of the U.S. born. Meanwhile, about half of Hispanics ages 30 to 49 (51%) and those 50 and older (47%) said so, compared with 39% of Hispanics ages 18 to 29.

As on many issues, views differed among Hispanics by political party affiliation. Roughly half of Republicans (52%) said their children will be better off financially than they are, compared with 44% of Democrats.

To read more about this, please go to https://www.pewresearch.org/hispanic/2020/08/04/coronavirus-economic-downturn-has-hit-latinos-especially-hard/

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  • Jens Manuel Krogstad and Mark Hugo Lopez of the Pew Research Center