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THE ORLANDO SENTINEL
Hispanics' Buying Power Soars, Report Finds
Consumer study takes in-depth look at `important and growing market'
By Cristina Elías | Sentinel Staff Writer
November 20, 2004
Hispanics will see their buying power grow 43 percent by the end of the decade -- controlling $670 billion in personal income, a new consumer report shows.
The Conference Board, a New York-based research group, recently released its first in-depth look at the economic clout of the Hispanic population.
Growing at a faster pace than any other demographic group, the Board said, Hispanic households are expected to go from 10 million today to 13.5 million over the next six years.
"We wanted to do a study of the Hispanic market because it's an important and growing market . . . and one that the general market tends to treat as a monolithic unit," said Lynn Franco, an economist with the Conference Board. "In reality, there are some very marked differences between the different nationalities."
Among the different groups, for example, the segment with the biggest economic potential are Mexican-Americans, who are expected to have a combined income of $409 billion by 2010.
They will be followed by Central and South Americans with $107 billion, Puerto Ricans with $65 billion, and Cuban-Americans with $32 billion.
The Hispanic heads of household that will control that money are typically younger than the general average, according to the study, with 38 percent of them 45 or younger.
As well, their purchasing power will grow from $295 billion to $397 billion. Three out of every five dollars earned by Hispanics by 2010 will be in the hands of this younger segment of the population.
Researchers also looked at current income and spending habits.
The average Hispanic household budget is more than 10 percent below the national average -- $28,000, compared to $31,860.
But Hispanics spend well above average on many products -- shoes, clothing, personal care products -- and on food items such as beef, pork and fruit juices.
Oscar Camey and his wife Ana María de Camey, two Guatemalan-born residents of Kissimmee, say food takes up the biggest chunk of their budget. The family buys up to five different types of meat a week and 25 pounds of rice at a time.
"In our country, the grandmothers are always after you to eat -- and lunch is the heavy meal of the day," Camey said. "So we always buy food for our kids to be snacking on, like ham sandwiches and fruit."
"We always say that food comes first," he said.
Many Hispanic households include extended family, from grandparents to aunts and uncles. Consumer experts say that's one of the reasons behind the spending choices and costs -- bigger households mean more basic needs, such as food and shoes.
"What we buy has to do with our cultural tendencies", said Felipe Korzenny, director of the Center for the Study of Hispanic Marketing Communication of Florida State University in Tallahassee. "We Hispanics give a higher priority to family matters. And for many, depending on where they come from, many buy to overcompensate for those things they didn't have in their own countries."