Pew: Latinos Hit Hardest by Economic Recession

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The economic recession, particularly the housing crisis, has hit Latino households harder than African Americans and whites, according to an analysis released by the Pew Research Center. Between 2005 and 2009, median wealth for Latino households decreased by an alarming 66 percent, 53 percent for African Americans, and by only 16 percent for whites. White households are 18 times wealthier than Latino households.

According to the Pew Research Center, median wealth for Latino households has decreased from $18,359 in 2005 to approximately $6,325 in 2009. The median wealth for African-American households decreased from $12,124 to $5,677 and $134,992 to $113,149 for white households.

About 31 percent of Latino households had a zero or negative net worth in 2009, compared to 23 percent in 2005. African-American households went from 29 percent to 35 percent, respectively, while white households with a zero or negative net worth jumped only four percentage points from 11 percent in 2005 to 15 percent in 2009.

The drop in house value has been identified as the main factor for the widening wealth gap, particularly among Latino households. White households’ wealth included investment in the stock market and corporate savings and thus was able to recover much quicker, as opposed to most of the wealth for Latino and African-American households which is concentrated in recently bought homes..

Latinos and African Americans have also been substantially affected by unemployment. Some 12.6 percent of Latinos were unemployed at the end of 2009; 15.6 percent of African Americans and 8 percent of whites were unemployed.