The economic war on Hispanic youth

When I think about the current state of our economy, I don’t think about it in terms of our anemic GDP growth or other indicators. Instead, I think about my three children, particularly my son, Cristian Marko. At age 20, Marko is only a few years away from graduating from college. When he starts working full time, the opportunities available to him, or lack thereof, will depend on the state of our economy.

If he had to start his career today, I’m not sure his success would be guaranteed. The recovery from the Great Recession has been a slow, drawn-out process. In the likely event of another prolonged recession, what would it mean for Marko and millions of other young Hispanic-Americans just looking for a start?

{mosads}Right now, young men and women in the Hispanic community are not well-positioned to make the most of the unlimited potential I know they possess. Hispanics tend to be younger than the general population — nearly 6 in 10 U.S. Hispanics are part of the millennial generation — and so millions are at a delicate beginning in their career trajectory. But trying to climb the ladder of opportunity today is a troubling proposition for these promising young people.

There are many reasons for this. Some policies make it needlessly difficult for young Hispanics to get their career underway. For those seeking a first job and a foot in the door, a high minimum wage is a barrier that can be impossible to overcome.

Although raising the minimum wage is all the rage in politics this year, it’s bad news for young Hispanics. Those with little work experience, or those who lack formal education — as I did when I was first getting my start — are frequently priced out of the workforce. The minimum wage contributes to that, making it harder for inexperienced workers to compete against more experienced job seekers.

No wonder most economists agree that minimum-wage hikes harm young workers the most. In 2011, the Institute for Labor Studies researched the minimum wage’s impact on U.S. Hispanic employment in recent decades and found that young Hispanics were more likely to lose jobs as minimum wages increased. 

Those who did find work didn’t always have it easier. Other costly regulations, especially the president’s healthcare law, also cut into opportunity. Having a job is great, but Hispanics are increasingly finding that there are fewer work hours available thanks to skyrocketing costs. A report produced by my organization’s sister group, the Libre Institute, documents this phenomenon, finding that the Great Recession forced more Hispanics into what’s classified as “part-time work for economic reasons.”

In other words, no full-time jobs were available.

Hispanics are also entrepreneurial, and many choose to work as their own bosses. Indeed, Hispanic-owned businesses are being created at a rate more than two times the national average.

That should sound promising, but the struggling economy means that it’s a tougher time than ever to start and run a business. In recent years, the U.S. reached the sad milestone of having more businesses failing than successfully starting. Those setting economic policy have placed too much emphasis on regulation, which costs time and money that would-be entrepreneurs simply don’t have. It also creates an endless maze of paperwork for Hispanic businesspersons — many of whom may have limited English proficiency — to confront.   

Finally, our government has tried to prop up the economy by substituting spending for true growth. Our national debt will hit $20 trillion next year. The cost of this will be disproportionately borne by future generations, like Marko and my other two children.

What effect will this have on young Hispanics’ dreams? As parents, a goal is helping our children move out and start families of their own. Many Hispanics associate homeownership with the American dream. But how will our children pay off homes, or student loans, or the startup funds needed to get a business off the ground, if they’re simultaneously responsible for paying off our nation’s tremendous debt?

This is the sad reality that Marko may have to confront when he graduates. I don’t think it’s set in stone. We can create an economy that empowers Hispanics rather than stifles their search for success. The solutions are policies that make it easier for people to get and hold full-time jobs, start businesses and find fulfillment in their lives.

That’s not the economy we have now. But I hope that’s the sort of economy that will greet Marko a few years from now.

Daniel Garza is the executive director of The Libre Initiative.