CONSUMER EXPENDITURES ⢠Consumer expenditures ...
CONSUMER EXPENDITURES Consumer Units in 2004
77.8%
10.6% 11.7% Annual Expenditures in 2004
82.7%
9.2% 8.1% Hispanic
White and all other races, Non-Hispanic
Black, Non-Hispanic
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Consumer expenditures are the average amounts that consumer units spend on goods and services annually. A consumer unit can be an entire household, unrelated and financially independent individuals, or subfamilies within a larger household. The consumer unit’s reference person, or householder, is one of the people who rent or own the home. The major expenditure categories include food, housing, apparel and services, transportation, health care, and entertainment. In reporting annual expenditures, the full cost of each purchase made in that year is recorded, even though full payment may not have been made at the date of purchase.
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In 2004, there were 116 million consumer units in the United States. Non-Hispanic blacks (hereafter “blacks”) constituted 11.7 percent (13.6 million) of these units, but accounted for only 8.1 percent of all expenditures. Hispanics represented 10.6 percent (12.3 million) of consumer units and 9.2 percent of expenditures. Most of the remaining 77.8 percent of consumer units (90.4 million) were white non-Hispanic, but this figure also included Asians and American Indians (see Figure 1).
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Black consumer units had an average annual income (before taxes) of $38,464 in 2004. This was lower than the income of Hispanic ($43,693) and all other consumer units ($58,314).
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Black consumer units spent, on average, 78.7 percent of their annual income ($30,286) in 2004. Hispanic expenditures represented 86.0 percent of their income ($37,578), and all other consumer units spent an average of 79.2 percent of their income ($46,163). Collectively, blacks spent $411 billion in 2004, Hispanics $462 billion, and all other consumer units $4,174 billion (see Figure 1).
Patterns of Expenditures •
There were important similarities in the spending patterns across the groups. Housing was the most expensive expenditure for each, costing 24 to 30 percent of the income of consumer units in each group. Transportation was the second-largest expenditure, taking 12 to 18 percent of income. Food, representing 10 to 14 percent of income, was the third-largest expenditure. All other major categories of expenditures—health care, entertainment, and apparel and services—each consumed less than five percent of consumer units’ income in each group.
Figure 2: Annual Expenditures as Percent of Income in Major Categories by Race and Ethnicity, 2004 30% 25% 20% 15% 10% 5% 0% Housing H is pa nic
Transportation
Food
Healthcare
W h i te a n d a ll o th e r ra c e s , N o n -H is p a n i c
Entertainment
Apparel and Services
B l a c k , N o n -H i s p a n ic
Figure 3: Average Annual Expenditures in Major Categories by Race and Ethnicity, 2004
$16,000 $14,000 $12,000 $10,000 $8,000 $6,000 $4,000 $2,000 $0 Housing H is pa nic
Transportation
Food
Healthcare
W h i te a n d a ll o th e r ra c e s , N o n -H is p a n i c
Entertainment
Apparel and Services
B la c k , N o n -H is p a n i c
Figure 4: Housing Components as Percent of Housing Expenditure by Race and Ethnicity, 2004
Black, Non-Hispanic
White and all other races, Non-Hispanics
Hispanics
0%
10%
20%
30%
40%
50%
60%
70%
80% 90% 100%
S h e lte r
U ti li tie s , fu e ls , a n d p u b l ic s e rv i c e s
H o u s e h o ld o p e ra ti o n s
H o u s e k e e p i n g s u p p li e s
H o u s e h o ld fu r n is h in g s a n d e q u ip m e n t
•
There were also significant differences in the spending patterns of these groups, however. Blacks and Hispanics spent, on average, higher percentages of their incomes on such necessities as food, housing, and apparel than other consumer units did. However, they spent lower percentages of their incomes on health care and entertainment (see Figures 2 and 3).
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Some of the differences in spending patterns may reflect differences in the characteristics of consumer units. Hispanic consumer units, with 3.3 persons per unit, were larger than black units (2.6 persons) and all other consumer units (2.3 persons). Hispanic units also had more children (1.2 children per unit) than black (0.8) and other consumer units (0.5). Hispanic householders were younger (42.2 years old) than householders in black (46.6 years old) and other consumer units (49.6 years old). Housing
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Black and Hispanic consumer units spent 28.5 percent ($915 per month) and 29.5 percent ($1,072 per month) of their incomes, respectively, on housing in 2004. Although other consumer units spent less of their income on housing (24.9 percent), their dollar expenditure was higher ($1,209 monthly).
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Hispanics’ housing expenditures increased 4.7 percent from 2003 to 2004. Black and other consumer units’ spending on housing increased 3.4 percent and 3.6 percent, respectively.
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By far the most costly component of housing in 2004 was the shelter itself. Shelter accounted for 58 percent of the housing expenditures of black consumer units, 60.8 percent of those of Hispanic units, and 57 percent of expenditures of all other consumer units (see Figure 4). However, utilities, fuels, public services (20 to 27 percent), and household furnishings and equipment (8 to 13 percent) also contributed substantially to the total cost of housing. Blacks and Hispanics spent higher percentages of their incomes on shelter, utilities, fuels, and public services than other consumer units.
Figure 5: Average Annual Expenditures on Transportation by Race and Ethnicity, 2004
$4,000 $3,500 $3,000 $2,500 $2,000 $1,500 $1,000 $500 $0 Gasoline and motor oil
Vehicle purchases H is p a n ic
Other vehicle expenses
W h ite a n d a l l o th e r r a c e s , N o n -H i s p a n ic
Public transportation B l a c k , N o n -H i s p a n ic
Transportation •
In 2004, black consumer units spent 12.8 percent of their income ($4,936) on transportation. This was much less than Hispanics (17.2 percent of their income, or $7,497) and all other consumer units (14.2 percent of income, or $8,273) spent on transportation. The lower expenditures of black consumer units in part reflected their spending significantly less money on vehicle purchases ($1,741) than Hispanic ($3,455) and all other consumer units ($3,639) (see Figure 5). Blacks owned fewer vehicles per consumer unit (1.3) than Hispanic (1.7) and all other consumer units (2.1).
Figure 6: Annual Expenditures on Gasoline and Motor Oil by Race and Ethnicity, 2003-2004
$1,800 $1,600 $1,400 $1,200 $1,000 $800 $600 $400 $200 $0 Hispanic
White and all other races, Non-Hispanic 2003
2004
Black, Non-Hispanic
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In 2004, black consumer units spent an average of $24 per week on gasoline and motor oil, compared to expenditures of $32 per week for Hispanic and for all other consumer units. Gasoline and motor oil expenditures represented 3.2 percent of the incomes of black consumer units in 2004, up from 2.9 percent in 2003. Expenditures on gasoline and motor oil increased from 3.6 percent to 3.8 percent of the incomes of Hispanic consumer units, and grew from 2.5 percent to 2.8 percent of the incomes of all other consumer units (see Figure 6). The increases primarily reflected an 18.2 percent increase in the prices of gasoline over the oneyear period.
77.8%
10.6% 11.7% Annual Expenditures in 2004
82.7%
9.2% 8.1% Hispanic
White and all other races, Non-Hispanic
Black, Non-Hispanic
•
Consumer expenditures are the average amounts that consumer units spend on goods and services annually. A consumer unit can be an entire household, unrelated and financially independent individuals, or subfamilies within a larger household. The consumer unit’s reference person, or householder, is one of the people who rent or own the home. The major expenditure categories include food, housing, apparel and services, transportation, health care, and entertainment. In reporting annual expenditures, the full cost of each purchase made in that year is recorded, even though full payment may not have been made at the date of purchase.
•
In 2004, there were 116 million consumer units in the United States. Non-Hispanic blacks (hereafter “blacks”) constituted 11.7 percent (13.6 million) of these units, but accounted for only 8.1 percent of all expenditures. Hispanics represented 10.6 percent (12.3 million) of consumer units and 9.2 percent of expenditures. Most of the remaining 77.8 percent of consumer units (90.4 million) were white non-Hispanic, but this figure also included Asians and American Indians (see Figure 1).
•
Black consumer units had an average annual income (before taxes) of $38,464 in 2004. This was lower than the income of Hispanic ($43,693) and all other consumer units ($58,314).
•
Black consumer units spent, on average, 78.7 percent of their annual income ($30,286) in 2004. Hispanic expenditures represented 86.0 percent of their income ($37,578), and all other consumer units spent an average of 79.2 percent of their income ($46,163). Collectively, blacks spent $411 billion in 2004, Hispanics $462 billion, and all other consumer units $4,174 billion (see Figure 1).
Patterns of Expenditures •
There were important similarities in the spending patterns across the groups. Housing was the most expensive expenditure for each, costing 24 to 30 percent of the income of consumer units in each group. Transportation was the second-largest expenditure, taking 12 to 18 percent of income. Food, representing 10 to 14 percent of income, was the third-largest expenditure. All other major categories of expenditures—health care, entertainment, and apparel and services—each consumed less than five percent of consumer units’ income in each group.
Figure 2: Annual Expenditures as Percent of Income in Major Categories by Race and Ethnicity, 2004 30% 25% 20% 15% 10% 5% 0% Housing H is pa nic
Transportation
Food
Healthcare
W h i te a n d a ll o th e r ra c e s , N o n -H is p a n i c
Entertainment
Apparel and Services
B l a c k , N o n -H i s p a n ic
Figure 3: Average Annual Expenditures in Major Categories by Race and Ethnicity, 2004
$16,000 $14,000 $12,000 $10,000 $8,000 $6,000 $4,000 $2,000 $0 Housing H is pa nic
Transportation
Food
Healthcare
W h i te a n d a ll o th e r ra c e s , N o n -H is p a n i c
Entertainment
Apparel and Services
B la c k , N o n -H is p a n i c
Figure 4: Housing Components as Percent of Housing Expenditure by Race and Ethnicity, 2004
Black, Non-Hispanic
White and all other races, Non-Hispanics
Hispanics
0%
10%
20%
30%
40%
50%
60%
70%
80% 90% 100%
S h e lte r
U ti li tie s , fu e ls , a n d p u b l ic s e rv i c e s
H o u s e h o ld o p e ra ti o n s
H o u s e k e e p i n g s u p p li e s
H o u s e h o ld fu r n is h in g s a n d e q u ip m e n t
•
There were also significant differences in the spending patterns of these groups, however. Blacks and Hispanics spent, on average, higher percentages of their incomes on such necessities as food, housing, and apparel than other consumer units did. However, they spent lower percentages of their incomes on health care and entertainment (see Figures 2 and 3).
•
Some of the differences in spending patterns may reflect differences in the characteristics of consumer units. Hispanic consumer units, with 3.3 persons per unit, were larger than black units (2.6 persons) and all other consumer units (2.3 persons). Hispanic units also had more children (1.2 children per unit) than black (0.8) and other consumer units (0.5). Hispanic householders were younger (42.2 years old) than householders in black (46.6 years old) and other consumer units (49.6 years old). Housing
•
Black and Hispanic consumer units spent 28.5 percent ($915 per month) and 29.5 percent ($1,072 per month) of their incomes, respectively, on housing in 2004. Although other consumer units spent less of their income on housing (24.9 percent), their dollar expenditure was higher ($1,209 monthly).
•
Hispanics’ housing expenditures increased 4.7 percent from 2003 to 2004. Black and other consumer units’ spending on housing increased 3.4 percent and 3.6 percent, respectively.
•
By far the most costly component of housing in 2004 was the shelter itself. Shelter accounted for 58 percent of the housing expenditures of black consumer units, 60.8 percent of those of Hispanic units, and 57 percent of expenditures of all other consumer units (see Figure 4). However, utilities, fuels, public services (20 to 27 percent), and household furnishings and equipment (8 to 13 percent) also contributed substantially to the total cost of housing. Blacks and Hispanics spent higher percentages of their incomes on shelter, utilities, fuels, and public services than other consumer units.
Figure 5: Average Annual Expenditures on Transportation by Race and Ethnicity, 2004
$4,000 $3,500 $3,000 $2,500 $2,000 $1,500 $1,000 $500 $0 Gasoline and motor oil
Vehicle purchases H is p a n ic
Other vehicle expenses
W h ite a n d a l l o th e r r a c e s , N o n -H i s p a n ic
Public transportation B l a c k , N o n -H i s p a n ic
Transportation •
In 2004, black consumer units spent 12.8 percent of their income ($4,936) on transportation. This was much less than Hispanics (17.2 percent of their income, or $7,497) and all other consumer units (14.2 percent of income, or $8,273) spent on transportation. The lower expenditures of black consumer units in part reflected their spending significantly less money on vehicle purchases ($1,741) than Hispanic ($3,455) and all other consumer units ($3,639) (see Figure 5). Blacks owned fewer vehicles per consumer unit (1.3) than Hispanic (1.7) and all other consumer units (2.1).
Figure 6: Annual Expenditures on Gasoline and Motor Oil by Race and Ethnicity, 2003-2004
$1,800 $1,600 $1,400 $1,200 $1,000 $800 $600 $400 $200 $0 Hispanic
White and all other races, Non-Hispanic 2003
2004
Black, Non-Hispanic
•
In 2004, black consumer units spent an average of $24 per week on gasoline and motor oil, compared to expenditures of $32 per week for Hispanic and for all other consumer units. Gasoline and motor oil expenditures represented 3.2 percent of the incomes of black consumer units in 2004, up from 2.9 percent in 2003. Expenditures on gasoline and motor oil increased from 3.6 percent to 3.8 percent of the incomes of Hispanic consumer units, and grew from 2.5 percent to 2.8 percent of the incomes of all other consumer units (see Figure 6). The increases primarily reflected an 18.2 percent increase in the prices of gasoline over the oneyear period.
