Hispanics Hit Hardest By Recession

According to a study published last week by Pew Research Center, Hispanic families experienced the greatest decline in net worth of all ethnic and racial groups in the US during the recession. The study used US Census data and found that the median wealth of Hispanic households decreased 66% from 2005 to 2009. This and the percent change in median household net worth of other racial and ethnic groups can be seen in the chart (right) that was included in a recent New York Times article discussing the results of the study. As the chart indicates, the Asian population experienced the second largest decrease in net worth at a 54% decrease between 2005 and 2009, while the Black population also experienced a large decrease in net worth at 53%. Whites fared comparatively well to all other races and ethnicities, only experiencing a decrease of 16%. Consequently, the US is currently experiencing the greatest wealth disparities in the 25 years the Census Bureau has been recording data of this nature, with the median wealth of white households now 20 times that of Black households and 18 times that of Hispanic households. The author of the article, Sabrina Tavernise, speculates that Hispanics were particularly vulnerable economically during the recession because nearly two-thirds of their net worth in 2005 was from home equity, which declined sharply with the collapse of the housing market. Whites, on the other hand, had a greater portion of their wealth in other assets, such as stocks. Ms. Tavernise also points out that Hispanics may have been more vulnerable due to the large Hispanic populations in places like Florida and California, which were hit particularly hard by the recession.