Latino Population and Spending Surges in Los Angeles County Grows to $72.4 Billion
Latino spending patterns and opportunities for marketers and business owners revealed in first-ever study on Latino consumer spending in L.A. County
In a less than spectacular retail economy climate, marketers and business owners have a real opportunity to grow significantly by targeting the Los Angeles County Latino community as its population and income continues to grows. This was among the major findings in a new study, An Analysis of Latino Household Consumer Spending in Los Angeles County, released today by Los Angeles Latino Chamber of Commerce (LALCC).
The study, which quantifies the significant economic impact of the Latino Market in Los Angeles County, revealed that local Latino spending has increased to $72.4 billion-driven by enormous demographic and income growth that has allowed Latino consumers to outspend other ethnic groups in most consumer segments.
“Latino population growth in recent decades, particularly among children and teens, along with increases in education and income levels, is helping to drive Latino spending in the county making Latino Los Angeles even more appealing to Madison Avenue and Wall Street,” said LALCC Chairman Gilbert Vasquez, whose organization commissioned the first-of-its-kind study.
“If Corporate America is looking to invest in the most dynamic Latino market in the United States, the findings of this study clearly suggest that they should bring their marketing and advertising dollars to the City of Angels,” Vasquez said. “Latinos in Los Angeles have shown a penchant to spend in key product segments-like children’s clothing, food prepared at home, and household supplies- to serve their growing families.”
Vasquez joined other LALCC officials and Latino business leaders at a news conference today at the L.A. Baking Company, a successful, Latino-owned company in Lincoln Heights. Raul Anaya, Bank of America Greater Los Angeles Market President, and Rudy Gutierrez, CEO & President, of Shell Roofing Solutions, were among the business leaders present.
“For over 100 years, Bank of America has been investing in the entrepreneurs and families who have been the drivers of growth in Los Angeles – and our partnership with the Los Angeles Latino Chamber of Commerce continues that commitment,” Anaya said. “We applaud the chamber’s study on the economic impact of Latino households because it underscores how Los Angeles’ diverse communities are evolving and maturing both economically and educationally. “In the end, we hope this will lead to greater opportunities for small business development, wealth creation, and investment in the Latino market.”
Another key finding of the study concluded that the Latino middle class in Los Angeles County is growing faster than the rest of the population because the children of Latinos are graduating from college and reaching their prime earning years. The proportion of Latino households earning between $100,000 and $200,000 per year in the county grew from 15.9 percent in 2000 to 26.1 percent in 2014. This further supports the significant opportunity that the Latino Market offers.
“The growing Latino market has benefited my business directly and indirectly, said Gutierrez. “My business and client base has grown rapidly to include a number of Vallarta and Northgate Markets, which have grown exponentially as a direct result of increased Hispanic incomes and significant spending in food and beverages.
“There is no doubt that I wouldn’t be successful if it weren’t for the Latino market,” Gutierrez said.
“Much has been made about Latino spending power throughout the United States,” said LALCC CEO Theresa Martinez. “By isolating these numbers in the county, marketers now have a snapshot of Latino consumer buying power in Los Angeles, which we believe is the most important Latino market in the country.
Key demographic findings include:
- The Latino population in the county grew by 15.5 percent from 2000 to 2014;
- Latinos made up 48 percent of the population of the county;
- The aggregate income of households with a Latino head-of-household grew from $45.9 billion to $72.4 billion in 2014;
- Latinos 55 to 64 in age more than doubled since 2000, suggesting that these workers in the latter stages of their prime working years are probably earning incomes greater than they have in any previous year; and Latinos over the age of 25 whose highest level of educational attainment is a bachelor’s degree grew by 134.6 percent from 2000 to 2014.
Key consumer spending findings:
- Latinos in the county spent $10.9 billion on food in 2014; by comparison Black, Asian and other non-white households spent a combined $8.5 billion on food that year;
- Latinos spending on eggs, poultry, beef and pork combined is estimated at $1.3 billion in the county, nearly as much spending in those categories by non-Latinos White households, and significantly more than Black, Asian and other non-White households combined;
- Locally, Latinos spent more on clothes for children under two ($166 million), boys between two and 15 ($246 million), and girls between two and 15 ($227 million) than any other race and ethnic group did in 2014;
- Approximately half of entertainment spending by the county’s Latino households in 2014 is categorized as audio and visual equipment, which totaled $1.3 billion. Spending in this category shows the importance that Latino households place on being home. In comparison, Asian, Black and other non-White households spent $1 billion; and Latinos households locally also spent $242 million on laundry and cleaning supplies, accounting for more than 32 percent of spending in the category throughout the county.
Los Angeles-based Beacon Economics, a leading economic research firm in California, conducted the study.
About Beacon Economics
Beacon Economics, LLC is a leading provider of economic research, forecasting, industry analysis, and data services. By delivering independent, rigorous analysis we give our clients the knowledge they need to make the right strategic decisions about investment, growth, revenue, and policy.
About the LALCC
The Los Angeles Latino Chamber of Commerce (LALCC) is a nonprofit, 501(c)(3) organization. The purpose of LALCC is to organize and unify Latino business owners to: advocate for small- and medium-sized businesses on a regional, statewide, and national basis; provide valuable and permanent member services for the improvement and success of their businesses; generate increased levels of business from outside the Latino community; provide overall leadership on relevant business issues as well as community economic development issues; generate increased levels of business between members.