Latino households are struggling to pay for basic expenses like food, housing and electricity, despite California’s strong economy and labor market. On average, they earn only 58% of what white households earn.
By Erica Hellerstein.
For three years, Kimberly Esquivel and her family lived in a studio apartment in Oakland, with Kimberly and her sister sleeping in the main room and her parents and two brothers in the hallway.
Esquivel’s father is legally blind and has a kidney condition that prevents him from working. Her mother sells jewelry, but it hasn’t provided enough money to improve their living situation. They can’t afford a car and food adds up. Kimberly, 18, and her 20-year-old sister want to go to college, but they can’t do it until the family’s finances become more secure.
The Esquivels’ precarious situation is not unique. In California, more than 50% of Latino households are hard-pressed to make it financially, despite the state’s booming economy and strong labor market, according to a new report from Oakland’s Insight Center for Community Development.
The study, released Thursday, found broad swaths of the state’s largest ethnic group living in economic insecurity and earning significantly less than Californians overall, even as many work multiple jobs to try to make ends meet.
Across the state, 52% — or 1.6 million — Latino households have trouble paying for basic expenses like food, housing, and electricity, the Insight center found, up from 49% in 2014. The median income for Latino households in 2016 was $56,200, compared with $78,00 statewide and $100,000 for Asian households, $96,400 for white households, and $55,200 for black households.
Latinos, the researchers found, often made lower wages. The median annual wage for the ten most commonly held jobs for Latinos — farming, construction, food preparation, transportation, sales, production, management, office and administrative work, personal care and grounds maintenance — was $37,000, compared to $72,000 for the ten most commonly held jobs for white and Asian workers. Latinos working in management make $70,255 on average, the report found, compared to white managers, who earn $123,051.
The Insight center’s analysis was based on 2016 data from the U.S. Census Bureau and measured through the Family Needs Calculator(FNC), a tool that estimates the cost of living for families of different sizes by looking at the cost of housing, transportation, food, and other expenses in each county in the state. The FNC is an alternative to federal poverty measures, which do not account for the cost of housing and other expenses.
In the Bay Area, 53% percent of Latino workers have trouble paying for basic expenses, compared with 30% among workers of all racial and ethnic groups, according to additional data provided by the center. The analysis also found that the median household income for Latino workers in the Bay Area is $70,900 annually and $110,000 in the Bay Area as a whole.
This economic picture is consistent with what Armando Hernandez, the director of community programs at the Oakland-based community organization the Unity Council, said he regularly sees in his work with low-income clients. Most Latino clients the organization serves have low-wage jobs, he said, and many have more than one, making it harder to pursue opportunities, like vocational and workforce training programs and high school and college degrees, that might lead to higher paying positions.
“Most families are working between two to three jobs,” Hernandez said. “That’s really the Catch 22 we find ourselves in. Clients come in and say, ‘I need a better job.’ But when we say: ‘Can you take this training or can we help you in this way?’ they say they have another job at that time or don’t have child care.”
He added, “The challenge really is time. Time is such a commodity for people with low incomes and low educational attainment. It’s a loop they’re caught in in having to work so much to make ends meet.”
The Bay Area’s housing crisis has also put a squeeze on many low-income Latino families, Hernandez noted.
“We are seeing seniors, working families, and youth that are being displaced, that are living in their cars, that are crashing with their families or their friends and in emergency shelters,” he said, adding, that what makes the situation so difficult here is “the housing and the fear of being displaced.”
Insight’s analysis is not the only one in recent months that has taken a look at wealth inequities among Latinos in California. A July report by the California Latino Economic Institute found Latinos faring worse than the general population on outcomes from poverty to educational attainment to home ownership. That report also found Latinos overrepresented in low-income groups and underrepresented in high-income groups, with 60% live in some form of inadequate housing.
“There’s just a compounding from multiple domains that make it very difficult for Latinos to enter the middle class,” says Mindy Romero, the director of the California Civic Engagement Project (CCEP) at the University of Southern California Price School of Public Policy and author of the report.
“It’s clear that however you slice the data, there is a consistency that’s being told for Latinos in California,” Romero said. “And it’s a story that our policies in our state clearly are not producing a good standard of living for the Latino community. There are significant disparities that have real impacts on people’s life chances, and they are entrenched.”
A few months ago, Kimberly Esquivel got a job at a local community organization, joining her sister as a main breadwinner, and together they saved enough money for the family to move to a two-bedroom apartment. Now Kimberly shares a bedroom with her sister, while her parents and her two brothers,14 and 17, share the other bedroom. No one sleeps in the hallway.
She’s relieved her family is in a better living situation and grateful she took her dad’s advice to hold off on taking a restaurant job so she could find a position that better fit her goals. She likes her job, she said, and hopes to keep working in her community after she goes to college — something that, for Esquivel and for her sister, remains in the future.
“Right now we’re kind of making sure that first we take care of our family,” she said.
Erica Hellerstein is a reporter at the Mercury News. This article is part of The California Divide, a collaboration among newsrooms examining income inequity and economic survival in California.