Latinx Community Struggles Against Covid-19 Recession

Woman with a mask on.

To get by Chelsea Lugo was working two jobs pre-COVID, one at a movie theatre and the other at a retail store. Both businesses are permanently closed as they were unable to survive the shutdown. Unlike Lugo, her father has been able to keep his event photography business alive with financial assistance.


“My mom is really great at bookkeeping, Lugo said in a phone interview with Luz Collective. “If we didn’t have those kinds of records kept, like if it was just at a hobby level, we wouldn’t have been able to get [small business loans and grants].”

Like Chelsea and her family, Latinxs hold employment in many sectors that are taking a financial hit during this recession like leisure and hospitality; manufacturing; wholesale and retail; and transportation and utilities. COVID-19 is encouraging people to stay home and social distance, causing many businesses to temporarily shut down, lay-off employees, adjust their business model, or permanently close their doors. The loss of income makes purchasing power more focused on consumer needs.

“The economic power of Hispanics is undeniable,” small business owner, Luciana Gómez said, in a phone interview with Luz Collective. “Hispanics play a huge role in this country from a numbers perspective to money.”

The coronavirus-created recession is causing many to wonder how Latinx wealth will recover, especially with immigrant workers left out of the coronavirus stimulus package.

“A lot of people that work with my dad are also furloughed,” recently unemployed South by Southwest staffer, Valeria Gonzalez said in a phone interview with Luz Collective. “It’s a restaurant, they’re struggling with opening hours and capacity and a lot of the workers are [undocumented]…technically they don’t qualify for unemployment.”

It’s important for many employees to also have stability. Especially now, employees need stability. For an economy to repair itself money must be distributed to consumers to spend on businesses that employ workers who will turn back into consumers. However, this cycle becomes damaged when there aren’t jobs to be held.

“Undocumented people who work are paying taxes, in many cases, paying rent, and consuming,” American Society of Hispanic Economists President, Mónica García-Pérez said in a phone interview with Luz Collective. “If they’re losing jobs, they’re going to stop paying rent, car payment, credit card payments, whatever services and goods they would normally consume.”

Although immigrant consumers and workers are keeping currency in rotation, Latinx unemployment numbers are skewed. García-Pérez believes the numbers we have may be underestimating the actual unemployment rate because of categorized information plus surveyors and the government failing to reach out to representatives of immigrant Latinxs for

accurate information.

“Normally they’re under certain degrees that are not counted in unemployment like freelance or working in non-traditional work situations,” García-Pérez said. “Immigrants are not going to benefit from any extension of unemployment insurance because most immigrants do not work with a corresponding W2 or with a company that is paying taxes, even if they’re paying taxes.”

Foreign-born Latinxs have a lower unemployment rate than U.S.-born Latinxs, according to Pew Research Center. Essential employees have been called back to work as child-care workers, factory workers, custodial staff, restaurant staff, all while being more exposed to coronavirus. Many believe this allowance of employment is contributing to the spread of COVID-19 among the Latinxs, causing the virus to disproportionately affect the Latinx community.

“Immigrants are more versatile and dynamic in finding different types of jobs, opportunity, and adjusting to it,” García-Pérez said. “If immigrants have the opportunity, they are also taking the risk in taking the jobs that are more exposed to the virus, but they don’t have the resources they would need in case they get infected like testing. And their stories aren’t being told because their numbers aren’t being shown.”

Latinxs are the largest ethnic population in the United States, making up 18.5% of the population. Like others in the United States, Latinxs have lost jobs while others continue to be employed and/or keep their business afloat.

Latinx wealth has been on the rise since the 2007 economic recession. Last September, Latinx

unemployment was at a record low of 3.9%. However, last month Latinx unemployment is recorded at 14.5%.

This recession has an added layer of caution surrounding it with many hoping to minimize the spread of the virus and get back to work. However, some businesses have been able to encourage social distancing while keeping their doors open for business through the Paycheck Protection Program (PPP) loan.

Nathalie Huerta was able to put the PPP loan towards her fitness-business, the Queer Gym in Oakland, California. Having to close the brick and mortar, she was able to successfully move it online. With the increase in clientele, she doesn’t see the benefit of going back to the way business was, pre-COVID.

“A lot of it was leaning into the situation like, ‘Enough complaining what do we do right now?’” Huerta said in a phone interview with Luz Collective. “That showed up in different ways whether through seeking information, creating and getting innovative with what we had, and how we can deliver it to our members.”

Gómez’s Café Victoria in Dallas, Texas, has been able to use the PPP loan to keep her coffee business’ brick and mortar open and partner with a neighboring business to create care packages for delivery. However, she isn’t afraid to reach into her pocketbook to help fund her business. Gómez also owns a marketing consulting agency, so her coffee shop isn’t solely dependent on the income of the business itself when in tough times. Gómez prefers to avoid loans because she feels foreign-born Latinxs have a different approach to finances.

“There are Hispanic business owners that don’t have good credit or very high-interest rates,” Gómez said. “Unfortunately [a loan] is not an option when the solution becomes the problem.So that’s probably why a lot of people are closing their businesses.”

Like many multilingual Latinxs, Gómez feels financial literacy can help Latinx employment, business, and wealth by the government improving English to Spanish translations on important documents.

“[Non-native English speakers] could have an interpreter for financial literacy when they go to the bank or interact with somebody in the government,” Gomez said. “A lot of times [loans] have to do with their citizenship status, so it’s important that whatever type of loan they get they want to make sure they’re not going to get in trouble.”

On average, a Latinx family has only 14.6% of the wealth of a white family, according to americanprogress.org. In recent years, foreign-born Latinxs are catching up in wealth to U.S.-born Latinxs, but a gap still exists. Layoffs have caused some like Gonzalez to move back into her parent’s home in Austin, Texas. García-Pérez says job loss is causing a drastic increase in housing insecurity among the Latinx population.

“At the private level Hispanics are facing evictions at a large rate because they may be losing their job or the hours they were able to work in the past or even losing one job when they used to work two jobs,” says García-Pérez.

Lugo is looking for more job security and plans to go back to school to complete her bachelor’s degree. Being recently unemployed, she is having a difficult time paying for school. Many are facing similar obstacles while unable to find childcare, like Elsa Jordan.

Jordan was able to go back to work at a salon for two weeks, after the shutdown, until she was fired because they could no longer afford her employment. She is now having trouble finding a job as her son’s preschool is no longer in business.

“When [the government is] passing things or thinking of things to better [Latinx] lives, engage with us, talk to us, see what we’re struggling with,” Jordan said in a phone interview with Luz Collective. “I feel that would help tremendously if they were talking to the community and not worried about making life comfortable for everybody.”

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Image by Sayuri Jimenez.

Nathalie Molina Niño has never been one to shy away from breaking barriers, and now, she’s focusing her attention on a new mission: demystifying corporate boardrooms for women, especially Latinas. Molina Niño is the President of Known, an asset management and financial services firm, a veteran tech entrepreneur and builder capitalist, and a board member at the iconic lingerie Brand, Hanky Panky, and others.

Like many corporate boards, Hanky Panky hadn’t publicly disclosed its board composition until recently. After the brand survived the challenges of the COVID-19 pandemic, Molina Niño decided it was time for more women, specifically more Latinas, to know what it means to be on corporate boards.

Coincidentally, the decision to finally be more vocal about this topic aligned with the start of Hispanic Heritage Month, which served as the perfect kick-off to the work.

"Something that rarely gets talked about and I think almost gets kept opaque by design is boards,” she explains in a recent Instagram announcement. “[This Latinx Heritage Month], that’s what I’ll be talking about.” Her goal? To equip more Latinas with the knowledge they need to navigate onto for-profit boards, where they can thrive and build multi-generational wealth.

For-profit corporate boards often feel like an exclusive club. And in many ways, they are, especially for Latinas, who hold the smallest percentage of board seats in Fortune 500 companies compared to other racial groups. According to the latest report from Latino Board Monitor, while Latinos hold 4.1% of these board seats (compared to 82.5% held by white people), only 1% go to Latinas. Molina Niño, a first-generation American of Ecuadorian and Colombian descent, is part of this boardroom minority.

When asked about her experience as a Latina board member during a recent Zoom interview, she said, “It’s been lonely. There’s not a lot of Latinas on boards.” She went on to explain that even serving on boards of Latina-founded businesses gets lonely because, “A lot of the times, people who serve on their boards represent their investors and, as a result, [...] you still don’t see a lot of Latinas on those boards.”

This lack of representation drives Molina Niño’s determination to increase Latina presence in corporate boardrooms. By sharing her insights, she hopes to give Latinas a roadmap to claim their seats at the table. “If you don’t know where to go, it’s impossible to figure out how to get there,” she says.

The Road to the Boardroom

Getting onto a for-profit corporate board isn’t an overnight achievement, but it’s not an unattainable dream either. People often think you need to be a CEO or have a certain type of background, but that’s one of the biggest myths about boards in Molina Niño’s experience. What they’re really looking for is expertise — whether that’s in finance, marketing, sustainability, or even technology. If you have that expertise, you’re already an asset. It’s simply a matter of which road you should take.

Understanding what boards are and how they operate is key to unlocking opportunities. For-profit boards serve as the governing body for companies, overseeing direction and financial stability, and guiding CEOs and executives in decision-making. But Molina Niño emphasizes that not all for-profit boards are created equal.

“There are two kinds [of for-profit boards] [...]. There’s the publicly traded business board and then, on the privately held side, there are, I would argue, two types of boards [...] the traditional business board and the venture-backed business board,” explains Molina Niño. Traditional businesses are often family-owned or long-established and may only form boards to meet requirements, like securing financing or transitioning through an ESOP. Venture-backed boards, on the other hand, are typically filled by investors who hold major stakes in the company.

According to Molina Niño, understanding the difference between them is how you can create a successful strategy. With publicly traded business boards, the whole world is privy to them, so, “The way that you get in there is a little bit more transparent. Sometimes those publicly traded companies will hire a recruiter to help them find new board members,” explains Molina Niño. For private companies, on the other hand, there’s no legal requirement to make announcements. As a result, most people don’t know anything about them or their inner workings.

“Usually what happens in traditional businesses that don’t have venture-capital investments is that the Founders, Executives, or the board members, if one existed already, they usually go to their friends,” and people they deem experienced to fill board seats. In other words, it’s the founder’s decision, and that’s an entirely different approach than hiring recruiters. When it comes to venture-backed business boards, the seats on the board are filled by whichever investor writes the biggest check.

This is why an understanding of the different types of boards and acknowledgment of their own strengths is what will help Latinas define a sound strategy. Whether that’s working with a recruiter, networking and connecting with founders to build trust, or making the biggest investment.

The Path for Latinas

For Molina Niño, the key to getting more Latinas into corporate boardrooms is education. Knowing what a board looks like and how it functions is how you can position yourself to get on it. In openly talking about this, without the mystique it’s usually shrouded in, Molina Niño is providing women, especially Latinas, with invaluable insights. “If we had Latinas understanding what are the three types of for-profit boards I think that, on their own, they would be able to figure out what their best chance is and adjust their careers to make themselves more competitive,” states Molina Niño.

When asked about the impact of increased Latina representation in boardrooms, Molina Niño flips the narrative. “Boards don’t help Latinas by offering them seats; Latinas help businesses thrive by being on their boards,” she says. “The whole point of sitting on a board is that you have experience and expertise, and as Latinas, you also have some cultural experience that everyone wants. [...] At the end of the day, we [Latinas] have to realize that we have a ton to offer and we have to be selective about where we put that expertise,” she explains.

As demand for access to the Latina consumer rises, Molina Niño predicts that more Latinas will find themselves recruited into boardrooms. But she’s not content to sit back and wait for that moment. By openly sharing her journey and insights, she’s making sure other Latinas know their worth and have the tools to claim their place at the table. “I realized that quietly being on boards that helped me personally is not helping other Latinas. [...] I was lucky enough to have friends who could advise me and share their experiences, so that’s why I’m doing this,” she stated.

With Hispanic Heritage Month as the backdrop, Nathalie Molina Niño’s mission is clear: “My goal is just to give Latinas enough information so they can make a plan for how to eventually get on a board that they’re paid to be on and that will eventually help them build generational wealth.”

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