WASHINGTON — The price of meat and gasoline is rising, and for Antonio Hernandez, owner of Tacos El Tony, the cost to run his business is taking a bite out of his personal savings.
“We’ve had to buy less for ourselves,” said the 40-year-old Modesto resident, speaking in Spanish.
Hernandez said he’s no longer buying personal items for his family like he used to. They’ve had to buy less for themselves and save their money. They aren’t sure how much longer they’ll need to dip into their personal savings to fund their business.
It’s the sort of problem Latinos are facing all over California, as the community is hit harder by the steepest rise in prices in nearly 40 years.
A variety of factors is inflicting the extra inflationary pain, said Monica Escaleras, director of the Florida Atlantic University Business and Economics Polling Initiative, which studies Hispanic consumer sentiment.
“Inflation is hurting Americans’ wallets as it hits a 40-year high in the United States, but certain demographic groups like Hispanics are feeling it the most,” Escaleras said.
On the whole, she and others found, Hispanics tend to make less money than whites and spend a larger percentage of their income on food and energy. They also were more likely to lose their jobs at the height of the COVID-19 pandemic.
Latinos and rising prices
Unemployment among Latinos has been consistently higher than the state and national average throughout the 22-month-long COVID-19 pandemic
“This has left some Latinos struggling to pay bills, afford groceries and cover medical costs,” said a Pew Hispanic Center study last year. Thirty-five percent of those it surveyed said they had trouble paying bills.
A big reason involves jobs. Last month the California Latino jobless rate was 5.8%, while for whites it was 4.6%, according to a California Budget & Policy Center analysis.
Because Latinos, particularly in rural areas, tend to work at lower paying jobs, more of their income goes for everyday costs such as food and energy, costs that have been soaring.
A Bank of America report last year found that African American and Latino households spent 7.1% of their post-tax income on energy compared to 5.4% spent by other demographic groups.
They spent 12.5% of that income on food compared to 11.1% for everyone else.
Food and energy are two of the biggest drivers of inflation. Energy prices were up 29.1% in December over a year earlier, led by gasoline, which jumped 49.6%, according to the Bureau of Labor Statistics.
That’s been a notable problem for Latinos who live or work in rural areas. “They have to drive longer distances,” Escaleras explained.
What will things cost?
Her latest study found that the majority of Hispanics are less optimistic about their financial situation as the year begins.
“The decrease in consumer confidence can be a consequence of the higher inflation that adds to the financial strain the pandemic has already caused,” she said.
Not all Latinos, of course, feel that way. Forty percent earn enough to be in the upper 60% of income in this country, Enrique Lopezlira, director of the Low-Wage Work Program at UC Berkeley.
Hispanics are “not necessarily more overburdened by inflation pressures than other groups. Hispanics with higher incomes are also more likely to own a home and participate in the stock market, so they have benefited from the increase in asset prices over the last two years,’’ he said.
But overall, surveys find most are nervous about what’s to come with inflation in 2022.
Cutting back on what his business needs isn’t an option for Hernandez, who says it’s what keeps a roof over his family’s heads. He works as the cook and his wife as the cashier, while also making hand-made tortillas.
Their business is among the fortunate ones that have been able to thrive amid the pandemic, despite not receiving government assistance. Hernandez says he was even able to hire an additional person to help serve and bus tables.
With meat and gasoline essential to his taco truck business, shopping for it and his family’s needs has been stressful lately. He’s been doing his best to save money, he says, by buying things in bulk and keeping an eye out for discounted items.
But even that isn’t enough to counter the rising costs of running his business. “We’ve had to raise the prices on our tacos, of everything,” he said.
From the price of his quesabirras, Spanish for a tortilla with melted cheese and beef or goat meat, to his meat-filled tortas, or sandwiches, every food item has gone up by at least 50 cents to keep up with the cost of inflation. He was worried that the rise in prices would drive away his customers. Thankfully, he said, they’ve kept coming back.
“Thank God they haven’t left me,” he said.
