How the Fiscal Cliff Could Affect Latinos

How the Fiscal Cliff Could Affect Latinos

If Congress fails to act on the “fiscal cliff,” come January 1 a series of tax cuts will expire and obligatory budget cuts will come into play that will likely drag our economy back into a recession.

What’s more, the Congressional Budget Office estimates that unemployment will likely rise to over 9 percent.

Everyone should be concerned about these negotiations, but Latinos in particular have a great deal to lose if Congress fails to act.

The Hispanic population already suffers a much higher unemployment rate than the general population, 10 percent vs. 7.7 percent for the national average.

Any job cuts resulting from budget cutbacks would likely affect the Hispanic population disproportionately and lead to even greater unemployment.

Read Related: 10 Things You’ll Lose if We Fall Off the Fiscal Cliff

Employed Latinos are less likely to have a college degree than either whites or African Americans, and they earn only 71 percent of the average weekly wage earned by whites.

Thus any economic downturn will further crimp their already below-average income stream.

In addition to making a bad employment situation even worse, the failure of Congress to act would impact Latino small business owners.

Hispanic small businesses represent the fastest component of that sector, with an estimated 6.3 percent being self-employed.

Not only will their income taxes go up, but small business owners will also be forced to withhold higher Social Security and Medicare taxes from their employees, thus lowering the take-home pay of many who are already struggling to survive in a tough economic climate.

In recent years, Hispanics have made great strides in gaining federal civilian jobs and are being more fairly represented in the government workforce.

The latest report from the government’s Office of Personnel Management notes that Hispanics now represent 8.1 percent of the federal workforce, up from 6.5 percent in 2000. Read the full article on FOX NEWS Latino.