Lower Wages and Continued Occupational and Industrial Segmentation of Latinos in the Chicago Economy

José Miguel Acosta-Córdova

In 1993, John Betancur, Teresa Córdova, and Maria de los Angeles Torres published “Economic Restructuring and the Process of Incorporation of Latinos into the Chicago Economy,” in Latinos in the Changing U.S. Econom,y edited by Rebecca Morales and Frank Bonilla. They concluded, “The history of the incorporation of Latino workers into the economy best explained the Latino experience in the Chicago area and provides a backdrop for understanding the impact of restructuring (110).” The authors argue that “the condition of ascriptive low-wage labor” restricted the mobility options for the Latino work force in the region. Examining PUM census data for the Chicago metro area from 1950 – 1980 on labor force participation, the study demonstrated that Latino labor, composed primarily of Mexicans and Puerto Ricans, facilitated the growth of the service sector in the Chicago economy while continuing to further entrench the segmentation of Latino labor in low-wage service sector employment.

The Latino population in the city has grown significantly since the Betancur et al. study (Cervantes, 1996; Suro, 2002; Paral et. al., 2004; Acosta-Córdova, 2017). However, no recent study has examined the industrial and occupational mobility of Latinos to the same extent as Betancur, et. al. Given the demographic growth of Latinos in Chicago and the continued changes in the Chicago economy, this study provides an update of the Betancur et. al. study to examine the changes taking place between 1980 and 2016 and to determine the extent of economic mobility for Latinos in Chicago. Using updated PUM census data, this thesis seeks to determine whether, since 1980, we continue to see what they described as the “continuation of occupational and industrial segmentation and lower wages” among Latinos in Chicago and how their labor force status affects policies and perspectives towards Latinos in the Chicago area.

This thesis finds that despite progress for Latinos in several industries and occupations, they continue to be segmented into jobs and industries with the lowest-wages. While African-Americans and Latinos both displayed similar conditions in most of the categories, Latinos had lower wages in more industries and occupations than any other group in Chicago. Even when accounting for a college degree, Latinos and African-Americans still earned far less than Non-Latino Whites and Asians, with Latinos earning lower wages than all other groups. This is crucial to understanding the reality of the economic conditions of Latino households throughout the region. On an individual basis, Latinos earn the lowest wages within the Chicago economy.

Regardless of any economic progress for Latinos since 1980, the amount of the labor force concentrated in low-wage industries and occupations shows that there is still ample room for growth. Latinos did not progress to the same extent as other racial/ethnic groups. Since 1980, the Latino population has exploded in the region, and if it were not for this influx, both the city and the metropolitan area would have lost a significant amount of total population during this period. What is crucial to understand about the restructuring of the Chicago economy, were it not for the influx of Latino immigrants, many industries that have grown or remained in the area since would not have found the labor to do it. It is because of the large source of low-wage labor that these industries have prospered. Latino labor has helped transform Chicago from an industrial metropolis into a modern-day, service-based metropolis. One could argue, Latinos saved Chicago’s economy.

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