The New Economy, The New Diversity, the New Inequality: Latino Futures, California s Challenges

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1 The New Economy, The New Diversity, the New Inequality: Latino Futures, California s Challenges Presented by: Manuel Pastor Center for Justice, Tolerance, and Community University of California, Santa Cruz February 7, 2003

2 What is the CJTC? Mission: Established in January 2000, the Center for Justice, Tolerance, and Community focuses on issues of social and economic justice, dialogues across diversity, and the building of collaborative communities. Combining cutting-edge research with an emphasis on public dissemination of findings and active engagement with affected communities, the Center aims to make a difference in people s lives by providing information and analysis for action.

3 Outline of Presentation What is the intersection of the new economy and rising inequality? Why is this a central issue for California Latinos? What are the challenges for policy and politics?

4 California s Demographic Change Figure 1-3. California's Demographic Changes, % 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Non-Latino White Latino African-American Asian Pacific Native American & Other

5 Long Term Trends in Inequality California's Changing Income Distribution, % 90% percent of total state income received 80% 70% 60% 50% 40% 30% 20% Top 5 % of taxpayers Next 15 % of taxpayers Middle 40 % of taxpayers Bottom 40 % of taxpayers 10% 0%

6 Who Gained and Lost in the Upswing $140,000 Household Income Changes (Top 20 & Bottom 40) in California over the 1990s $127,240 $120,000 $109,630 $116, dollars $100,000 $80,000 $60,000 Top 20 Bottom 40 $40,000 $20,000 $16,730 $17,085 $19,755 $

7 Race Matters Figure 3. Shifts in Household Median Income by Race, California in the 1990s $60,000 $50,000 $40,000 $30,000 $20,000 $10,000 $2,179 $861 $357 $2,829 $0 -$10,000 Anglo Af-Am Latino Asian -$20, % -$30,000 -$40,000 -$50, % 3.1% 1.3% -$60, % 22.0% 20.0% 18.0% 16.0% 14.0% 12.0% 10.0% 8.0% 6.0% 4.0% 2.0% 0.0% income income $ change % change over period

8 It Isn t Just Immigration $50,000 $45,000 Household Income for US-born Anglo, US-born Latinos, and Immigrant Latinos in California, 1990s income 1999 $ $40,000 $35,000 $30,000 $25,000 $20,000 $15,000 $10,000 $5, % 54.2% $0 US-born Anglos US-born Latinos Immigrant Latinos 0

9 How Can We Narrow the Divide? Economic growth, partly through regional clusters Education and training New networks and connections Labor standards that set new floors

10 Why Growth? Flattening of the Wage Distribution in the Peak of the Boom 20.0% 17.5% 16.8% % change, % 14.2% 12.5% 10.5% 10.0% 7.5% 5.0% 25th percentile 50th percentile 75th percentile

11 Wages, Race, and Recovery $19 Median Wage by Race in California (three year moving average) $18 $17 $ dollars $15 $14 $13 $12 $11 Anglo Black Latino $10 $

12 Education and Training is a Must In explaining the growing wage inequality in the California and the nation, several main culprits: globalization technology Both raise the wage premium and Education can close the gap

13 $30 Education and Wages, Wages and Education Since 1980 in the U.S. Labor Market percent gain over period 28.6% $ % Wage in 2001 dollars $20 $15 Less than High School High School Some College College Degree Advanced Degree 6.8% 1.5% $ % $

14 Relative Education Levels in California 100% Figure 9. Educational Attainment for Those in the Labor Force, California % 80% 70% 60% % of group 50% 40% college grad high school grad less than high school 30% 20% 10% 0% Anglos Latinos U.S.-born Latinos

15 Adding Networks to the Picture Community Isolation Disconnection from regional economy, political power, and policy opportunities Lack of bridging social capital to connect to key sources of power Importance of thinking and linking to the region Individual Isolation Skill mismatch Spatial mismatch Social mismatch bonding and bridging social capital

16 Job Openings in the New Economy Top Six Occupations With the Greatest Absolute Job Growth in California, Absolute Percent Education or Occupation Change Change Experience Required GENERAL MANAGERS, TOP EXECUTIVES 85, % GENERAL OFFICE CLERKS 81, % SALESPERSONS, RETAIL 77, % CASHIERS 68, % WORK EXPERIENCE, PLUS A BACHELOR'S OR HIGHER SHORT-TERM ON-THE-JOB TRAINING SHORT-TERM ON-THE-JOB TRAINING SHORT-TERM ON-THE-JOB TRAINING SYSTEMS ANALYSTS--ELECTRONIC DATA PROCESSING 53, % BACHELOR'S DEGREE Network engineer or programmer? Hmm... GUARDS AND WATCH GUARDS 52, % SHORT-TERM ON-THE-JOB TRAINING

17 Looking for Hope Keep Looking 100% Labor Location for the Future Anglos and Latinos in California 90% 80% 70% 60% 26.3% 34.1% 15.4% 44.9% high-wage, fastgrowth low-wage, fastgrowth 50% 40% 30% 20% 18.4% 12.3% high-wage, slowgrowth low-wage, slowgrowth 10% 21.2% 27.5% 0% Anglo Latino

18 Scotts Looking Valley Local... County boundaries City boundaries Santa Cruz Capitola Watsonville 0% - 20% 20% - 40% 40% - 60% 60% - 100% Marina Salinas Pacific Grove Sand City Seaside Carmel-bythe-Sea Monterey Gonzales Figure 1. Percentage Latino by Census Tract in 1980 in Santa Cruz and Monterey counties Note: This view focuses on the most populated areas of Santa Cruz and M

19 Scotts Looking Valley Local... County boundaries City boundaries Santa Cruz Capitola Watsonville 0% -- 20% 20% -- 40% 40% -- 60% 60% % Marina Salinas Pacific Grove Sand City Seaside Carmel-bythe-Sea Monterey Gonzales Figure Percentage Latino by Census Tract in in Santa Cruz and Monterey counties Note: Note: This This view view focuses on on the the most most populated areas areas of of Santa Santa Cruz Cruz and and Mo M

20 Scotts Looking Valley Local... Capitola Santa Cruz Watsonville County boundaries City boundaries 0% -- 20% 20% Less -- 40% than $34,999 40% $35, % - $47,499 60% $47, % or more Marina Salinas Pacific Grove Sand City Seaside Carmel-bythe-Sea Monterey Gonzales Figure Median Percentage Household Latino by Income Census by Tract Census in 2000 Tract 1980 in 1999 in Santa Cruz and Monterey Counties counties (in 1999 dollars) Note: This view focuses on the most populated areas of Santa Cruz and Mo Note: This view focuses on the most populated areas of Santa Cruz and M

21 The Politics of Putting It All Together Pressing Needs & Now More Than Ever Recession will be an excuse for some to forget the bottom but equity is not a luxury Universal and Particular Approaches Understand that Latino issues are, in large part, California issues Face-to-face and Race-to-race Encourage conversations and collaboration to break barriers

22 Restoring the California Promise Public Will and Civic Engagement Investing in Everyone s Children Offering a Vision of What We Have Been and Could Be

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