According to a new report from Geoscape, reported by Marketing Charts, looking at multicultural trends in the US, the median household income for Hispanics this year is estimated to be close to $45k, below the $57k average. 19% of the US population identifies as Hispanic, and two-thirds of the Hispanic population are from Mexico.
While Hispanics have median household income that’s about 20% lower than the overall median average, their sheer size means that they’re approaching $1 trillion in aggregate household income this year.
Aggregate Household Income & Consumer Spending
Aggregate HH Income (Billion)
Household Consumer Spending (Billion)
Asian & Pacific Islander
Source: MarketingChartsPublished August 2017/Data Source Geoscape Projections
Hispanics’ size and aggregate household income translates to purchasing power, says the report. This year, total Hispanic household consumer expenditures will exceed $815 billion. Past research has found that Hispanics spend more on a daily basis than other cultural groupsand the Geoscape report shows that as a percentage of total household income, Hispanics will spend more than Asians and Blacks this year.
And, according to the US Census Bureau data, more than one-quarter of Americans under the age of 14 are Hispanic. In the Los Angeles DMA half of pre-schoolers (ages 0-4) will be Hispanic by 2022, according to Geoscape’s report.
Asian households have the highest median household incomes. At almost $79k, they’re more than one-third higher than the national average, says the report. That pushes aggregate income for Asian households to almost $544 billion, with total consumer spending projected to reach almost $403 billion.
In addition, Asian-Americans tend to have a much more varied mix of origin countries. The largest proportion (23.9%) are Chinese and Taiwanese, followed by Asian Indians (19%), Filipinos (18.2%), Koreans (10.8%) and Vietnamese (10.7%).
Black Americans have the lowest median household incomes of these groups, at around $37.3k, says the report. That’s almost one-third lower than the US average. Nevertheless, Black Americans exceed $784 billion in total household income, and are expected to total more than $640 billion in household spending this year, says the report.
In terms of total annual expenditures, Hispanics are expected to spend the most this year on Shelter & Insurance, Food & Beverages, Transportation and Personal Insurance. And, while Shelter & Insurance is also the top-spending category for Blacks and Asians, both groups will spend more on Transportation than on Food & Beverages.
As a function of their remaining life spans (life expectancy minus median adult age) and household spending, Asian and Hispanic households will spend more over their remaining lifespans than Black and White households, according to the report.
In fact, the average Asian household will spend $1 million more than the average non-Hispanic White household over their remaining lifetimes, with the average Hispanic household spending $625k more, showing the importance of acquiring brand-loyal households in these cultural segments, according to the study.
To read the complete report from Marketing Charts, please visit here.