Every demographic in the U.S. economy is making gains, according to the latest Multicultural Economy report from the University of Georgia.
The annual report calculates the consumer buying power—or total income after taxes—for several racial and ethnic groups in the U.S.: African-Americans, Asian-Americans, Hispanics, Native Americans and whites. Published by the Selig Center for Economic Growth, a unit of UGA’s Terry College of Business, the Multicultural Economy report is available for purchase here: http://www.terry.uga.edu/about/centers-institutes/selig
The Selig Center estimates U.S. consumer buying power totaled $14.6 trillion in 2017, an increase of 97 percent since 2000 and 30 percent since 2010, with the biggest gains among minority markets. The combined buying power of blacks, Asian-Americans and Native Americans is estimated to be $2.4 trillion, while the nation’s Hispanics command $1.5 trillion in spending power—larger than the GDP of Australia.
All minority consumer markets have grown faster than the buying power of whites since 2000, but the biggest increase came from Asian-Americans. Their estimated buying power totaled $986 billion in 2017, an increase of $709 billion, or 257 percent, since the turn of the century.
“The percentages tell the story,” said Jeff Humphreys, director of the Selig Center and author of the report. “While there are lots of groups that are making big gains, the percentage increase in the Asian-American market is quite a bit larger. It’s an indication that this market has been a bit underserved, and marketers and businesses are making up for it.”
At 257 percent, the Asian-American rate of growth compares with 203 percent for U.S. Hispanics, 180 percent for Native Americans, 108 percent for African-Americans and 87 percent for whites during the same period.
The report also breaks down spending data by area. For example, the top 10 states and territories ranked by the percentage increase in total buying power for all races since 2000 are North Dakota (158 percent), Utah (146 percent), Wyoming (140 percent), Texas (140 percent), Oklahoma (132 percent), District of Columbia (124 percent), Arizona (122 percent), Washington (118 percent), Idaho (117 percent) and Montana (116 percent).
Black Buying Power
African-American buying power reached $1.3 trillion in 2017, accounting for 8.7 percent of the U.S. total, according to the report. Humphreys attributed the 108 percent growth rate since 2000 to increased entrepreneurial activity, strong population growth and higher educational attainment.
The African-American population skews youthful, with a median age of 31.4 years that is lower than the national average of 36.7 years. Humphreys said black buying power should edge up as the average demographic enters higher earning years.
The 10 states with the largest African-American consumer markets in 2017 are Texas ($117 billion), New York ($116 billion), California ($93 billion), Florida ($90 billion), Georgia ($90 billion), Maryland ($72 billion), North Carolina ($60 billion), Virginia ($54 billion), Illinois ($52 billion) and New Jersey ($46 billion).
Where blacks spend more:
• natural gas
• used vehicles
Where blacks spend less:
• new cars
• dining out
• health care