February 23, 2001


More Hispanic households in the U.S. are joining middle class, study says

By Eduardo Porter
The Wall Street Journal

February 14, 2001 -- Despite the widespread belief that Hispanics in the U.S. are "mired in poverty," they are quickly climbing the economic ladder, with more than one million Hispanic households joining the ranks of the middle class during the past two decades, according to results of a study set to be released Tuesday.

The analysis, by the Tomas Rivera Policy Institute (www.trpi.org), suggests that this upward mobility is often obscured for a simple reason: The large number of poor immigrants arriving from Latin America — especially Mexico — puts a drag on Hispanic income data, contributing to a misleading portrait of the Hispanic community.

"The misperception persists that Latinos are poor, uneducated and foreign-born," the report says. "The facts tell a different story." Specifically, the study — titled "The Latino Middle Class: Myth, Reality and Potential" — found that though the growth of the Hispanic middle class has lagged the expansion of the Hispanic population, it has recorded a significant increase. While the number of Hispanic households doubled between 1979 and 1998, to 7.5 million, the number of those in the middle class grew nearly 80% to almost 2.7 million from 1.5 million.

"The rising tide has lifted all boats, including the Latino boats," said Harry Pachon, president of the institute, a nonprofit think tank in Claremont, Calif., that conducts policy research on issues affecting U.S. Hispanics.

Even so, Hispanics overall remain less well off than some other groups. According to the U.S. Census Bureau, median Hispanic household income in 1999 was less than $31,000 — $10,000 less than the average for the nation's entire population.

A major thrust of the Tomas Rivera study was to show that Hispanics born in the U.S. are doing better than the newly arrived. While in 1998 only 35% of all Hispanic households had reached the middle class — defined as those having an annual income exceeding $40,000 — about 42% of the households of U.S.-born Hispanics had reached this station, three percentage points more than in 1979. By comparison, 60% of non-Hispanic whites were considered middle class in 1998.

At the same time, the number of foreign-born Hispanics at the bottom of the income scale swelled. Between 1979 and 1998, the number of immigrant Hispanic households with incomes of less than $20,000 grew to slightly more than 1.6 million from 600,000, surpassing the one million U.S.-born Hispanic households at this level. During the 1990s, as the number of poor Hispanic immigrants grew, average income for foreign-born Hispanics fell dramatically.

Stephen J. Trejo, an economist at the University of Texas at Austin who is one of the report's authors, said the findings suggest the Hispanic experience isn't unlike that of other immigrant groups in the U.S. "The kids are doing better than the parents in the labor market," he explained.

A pivotal reason is education. In fact, annual income for a U.S.-born Hispanic man with a college degree reached $60,600 in 1998, only 13% less than the level for non-Hispanic whites, according to the study. A Mexican immigrant without a high-school diploma, on the other hand, makes less than $19,000 a year on average.

Dowell Myers, a demographer at the University of Southern California, says that while fewer than 20% of new immigrants in Southern California have a high-school diploma, nearly 80% of their children complete high school. "In the second generation, there's an educational boost and an occupational boost," said Mr. Myers, whose previous research has reached many of the same conclusions as the Tomas Rivera study.

The Tomas Rivera study shows a similar trend nationwide. Immigrant Hispanic men have less than 10 years of education under their belts, on average. But their children close most of the gap with the rest of the population. By the second generation in the U.S., Hispanics have on average 12.3 years of schooling — barely less than the 13.5 years of schooling among non-Hispanic whites.

Still, the study doesn't paint an unblemished picture of Hispanic achievement. U.S.-born Hispanics are two to three times more likely than are non-Hispanic whites to fail to complete high school. What's more, only about 15% of Hispanics earn bachelor's degrees, half the rate of non-Hispanic whites.

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