VIII. Growth in Wages, 2006 and 2007

Wage growth in 2007 was moderate and reflected the effects of the economic downturn. Hispanics as well as non-Hispanics experienced slower wage growth in 2007 than in 2006. But workers dependent on the construction industry—including male Hispanics, Mexican-born workers, newly arrived Hispanic immigrants and Latino construction workers in general—saw their wages decline. Many groups of Hispanic workers earned less in the first quarter of 2008 than they did two years ago, in the first quarter of 2006, although native-born Hispanics’ wages increased slightly.

In the first quarter of 2008, the median weekly wage in the economy was $626—half of workers earned more and the other half earned less.¹⁷ The median earnings of non-Hispanics were slightly higher at $669 (all wages expressed in 2008 dollars).

Hispanics earn considerably less than non-Hispanic workers. In the first quarter of 2008, they earned $480, or only 71.7% of what was earned by non-Hispanics. The current gap between the earnings of Hispanic and non-Hispanic workers is not very different from the first quarter of 2006. At that time non-Hispanics earned $648 and Hispanics earned $470, or 72.6% as much.

Median weekly wages for all Hispanics were unchanged in 2007. They earned $480 in the first quarter of 2008 and $479 in the first quarter of 2007. This was a worse outcome than the previous year, as their wages had increased 2.0% from the first quarter of 2006 to the first quarter of 2007.

Wages of non-Hispanic workers also were unchanged in 2007, inching up from $667 in the first quarter of 2007 to $669 in the first quarter of 2008, an increase of only 0.4%. In the previous year, wages of non-Hispanic workers had increased 2.9%, from $648 in the first quarter of 2006.

The earnings of most groups of Hispanics workers in 2008 were less than their earnings in 2006. Male Latinos earned $512 per week in the first quarter of 2006, but only $500 per week in the first quarter of 2008. This was the result of a 4.0% drop in wages for male Hispanics in 2007. Female Latinos earned $427 per week in the first quarter of 2006 and $423 per week in the first quarter of 2008. For them, this was the result of a 2.4% decline in earnings in 2006.

Native-born Hispanics were able to secure wage gains in both 2006 and 2007. Nonetheless, wage growth for them also moderated in 2007 as they experienced an increase of only 1.5% in comparison with 5.6% in 2006. Wages for foreign Hispanics are stagnant. The current weekly earnings of foreign-born Hispanics—$428—are essentially the same as the $427 in the first quarter of 2006.

The most notable aspect of wage trends in 2007 was the experience of Hispanic workers who depend upon the construction industry. The median weekly earnings of workers born in Mexico and those who arrived in 2000 or later fell 3.1% and 4.3%, respectively, in 2007. Median wages for both groups of workers are currently less than their level two years ago, in the first quarter of 2006.

Hispanic workers employed in the construction industry suffered deep wage cuts in 2007. Their weekly earnings fell from $521 in the first quarter of 2007 to $485 in the first quarter of 2008, a decrease of 6.9%. Foreign-born Latinos in the construction industry suffered a loss of 4.0% in their earnings.