Between 2010 and 2020, the share of Americans who identify as Hispanic or Latino grew over five times as fast as that of non-Hispanics. 

The trend is expected to continue through the next decade. 

Latinos make up 19% of the U.S. population, and, in recent years, they’ve seen rising income, wealth, and educational attainment, positioning them to be larger contributors to the U.S. economy through increased entrepreneurial activity and consumer spending, according to a recent Wells Fargo report. What’s more, their employment rate is trending upward.

As with most underrepresented groups, Hispanic workers are disproportionately affected by a recession, leading many economists to fear a dip in job growth as warnings of a shrinking job market abounded earlier this year. That hasn’t been the case. In fact, the tight labor market, especially in sectors where Latinos are hugely represented, like the construction industry or food services, has benefited this demographic after a nosedive in employment during the pandemic’s early months. 

At 4.7% in August, the Hispanic unemployment rate is “more or less at an all-time low,” although slightly higher than the national unemployment rate of 3.7% that month. And their employment has grown three times as fast as non-Hispanic employment since the mid-1980s, according to Wells Fargo economists.

Still, despite their growing representation in the American workforce, Hispanics earn just 80 cents for every dollar earned by the average U.S. worker and just 76% of the average non-Hispanic white worker. The reasons for this income gap are myriad, but job composition plays a role: Hispanics are overrepresented in traditionally lower-paying industries like leisure and hospitality, retail trade, transportation, and warehousing. And because they’re also overrepresented in goods-related industries, economic slowdowns hit them harder than other demographics. 

Lower educational attainment is another lever contributing to the job composition of the Hispanic workforce and, in turn, their income gap. However, educational attainment among Hispanics in the U.S. is rising and could bolster their income growth in the coming years.

“If, as we anticipate, this income share continues to rise, then Hispanic Americans should command a rising share of consumer spending, especially in terms of discretionary purchases,” according to Wells Fargo economists.

Ruth Umoh
@ruthumohnews
ruth.umoh@fortune.com

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