Morning Plenary: Latinos Leading in the Economy and Workforce
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Latinos were clearly among the hardest hit groups in the current recession based on immigration status, their heavy concentration in industries and geographic areas hardest hit, and participation in sub-prime mortgages. The good news is that the economy is poised the see recovery beginning in the 3rd quarter this year and many of the administrations top priorities address the communities most vital needs.
Raul Hinojosa-Ojeda, associate professor at UCLA, projects that immigration reform will provide stimulus as undocumented workers come out of the shadows and participate in the economy. He looked back to the 1960s when, as a result of the Immigration and Nationality Act of 1965, wages rose by 30 to 50 percent and the middle class grew. He projects more than $1 trillion in economic benefit to the United States from immigration reform today.
Another critical issue is banking reform and access to banks and financial services for all U.S. residents. He cited that $6 billion is spent each year in payday check cashing services, limiting access to capital and the ability to build wealth. A similar issue is the predatory practices that have trapped millions of Americans in sub-prime loans and triggered the housing crisis. He is concerned about the potential for more foreclosures coming and feels the administration policy does not go far enough. He noted that the intergenerational cycle of younger Americans moving up the housing market to buy larger homes is breaking down and could lead to another housing market bust.
As a member of the House Economic Committee, Rep. Loretta Sanchez (CA-47) reiterated that the economic downturn has hit the Hispanic community particularly hard. About 13 percent of Hispanic men are out of work and cannot find jobs. Many who turned to community colleges to better their education and skill set for when the economy improves found that classes are being cut due to a lack of funding. She expressed an urgent need to increase Pell Grants, keep schools open, and retain teachers.
Alan B. Krueger, assistant secretary for economic policy and chief economist at the Department of the Treasury, says that while the average decline in real media income was 3.6 percent for Americans overall, Latinos experienced a 5.6 percent decline on average. He feels the economic stimulus package invested too little in human capital and infrastructure and too much in unproductive activities, but he credits the stress test for banks for restoring confidence to our financial system and stabilizing the economy. The boom and bust cycle was magnified for Hispanic families because many are concentrated in the industries hit hardest by the downturn-construction, food, and accommodations. He projects that unemployment is likely to increase to about 10 percent before starting to decline. He stressed that reform is still needed in our financial system and that we should fall into complacency on this issue as the economy recovers.
On the housing front, Shaun Donovan, secretary of the Department of Housing and Urban Development (HUD), pledged that quality housing is possible for all Americans. Recently HUD awarded $6 million to 10 Hispanic colleges to stimulate rehabilitation of homes, help with closing costs, and provide housing counseling. Hispanics were also among the hardest hit in the housing crisis with Nevada, Arizona, Florida, and California the four states hardest hit. HUD has allocated an additional $14 billion in improvements in public housing and $3 billion to prevent homelessness. An additional $2 billion has been invested in neighborhood stabilization to purchase foreclosed homes for low-income housing. HUD is also mobilizing a network of counselors to help modify 500,000 mortgages. Findings now show that 61 percent of homeowners pushed into sub-prime loans could have qualified for standard financing.
Labor Secretary Hilda Solis, said that the Latino community entered recession early and was his particularly hard. Construction activities are down 13 percent, leaving 22 percent of Latinos below the poverty line. Her first priority was to provide needed resources through the Recovery Act to provide extended unemployment insurance and extend COBRA coverage and reduce premiums. She also noted that Latinos suffer disproportionate injuries and death the in workforce and that she has hired 130 extra OSHA investigators and 275 additional wage investigators. She noted that the Recovery Act also supports loans to Latino businesses and grants to prepare workers for green jobs opportunities. She said that green jobs are good jobs, which pay 10 to 15 percent more than regular jobs. She noted the need to prepare more American in math and science so they can we can develop more jobs that can support a family and rebuild a strong middle class. She urged support for health insurance reform, expressing that the system works better for the insurance industry right now than for our families. She noted that our nation's problems didn't happen overnight and it will take some time to overcome.