Latino businesses face slump due to economy and deportation fears

American Dream fading for Latino business owners
Customers who lost jobs in the sinking economy or fear being deported are spending less or leaving.
By Franco Ordoñez
fordonez@charlotteobserver.com
Posted: Friday, May. 08, 2009
Slideshow

Celestino Hernandez owned four groceries across Charlotte, but in the last two months, he has had to close three. And sales at his one remaining store are down more than 50 percent.

At this time last year, he owned four groceries and three bakeries. For many Latinos, he was a symbol of the American dream.

No longer. Hernandez and other Latino business owners face uncertain futures as their customers flee a slumping economy and the threat of deportation.

In the past four months, Hernandez closed his three bakeries and all but one of his Carniceria La Mexicana groceries, including the South Boulevard store.

“We lasted 13 years, three months and 15 days in that store,” Hernandez says.

He takes a deep breath.

“And then the worst crisis I've ever seen in my life.”

No part of North Carolina has more Latinos than Mecklenburg County – some 80,000 live here.

More than half of the state's Latinos work in construction (42.2 percent) or manufacturing (10.7 percent), according to a 2006 study by UNC Chapel Hill's Kenan Institute.

Both industries were hit hard by the recession. In the past year, 41,500 N.C. construction workers lost their jobs because of the housing crisis and commercial real estate declines. In February, N.C. factories cut 14,900 jobs.

Those lost paychecks meant lost business for people like Iris Garcia, a hair stylist on South Boulevard. She says her client list is down 20 percent.

She blames the economy, but also says tougher immigration enforcement has driven Latinos away. “It's a crisis,” she said. “People don't have jobs, and they're scared.”

As the Latino community grew, so did the number of Latino entrepreneurs looking for an opportunity.

The Charlotte region has more than 3,000 Latino-owned businesses, two-thirds of them in Mecklenburg County, according to the Charlotte Chamber.

But after more than a decade of increases, the number of Latino-owned businesses has dropped the past two years, according to Tony Crumbley, vice president of research at the chamber.

Maria Saavedra and her husband, Henry Jimenez, were only thinking about the years of growth when they started their Mexican/Honduran restaurant on South Boulevard.

Carpenters and painters eating Honduran baleadas (tortillas layered with beans and cheese) filled the booths of El Casa Grande when it opened last fall, Saavedra said. The jukebox boomed with Mexican ballads. Workers returned on weekends to sit at the shiny bar, kick back with a beer and watch soccer on the big screen.

Now Saavedra, 28, and Jimenez, 30, wonder if their restaurant was a bad choice.

“We have no clients,” Saavedra said. “Before, people ate out. They ate meat and they didn't worry.”

On a recent Friday afternoon, the jukebox was silent, the bar was empty, and El Casa Grande had four customers – two ordered take out.

Sitting alone at the bar, waitress Nadina Vazquez, 30, said she used to make about $60 a day, mostly in tips. One day, she got just $4.

“Look at the hour,” she said. “There is no one.”

Vacant store fronts along Central Avenue harken to the 1980s, when shoppers fled the area for suburban stores.

Along with other immigrants, Latinos helped revitalize the international corridors on Central and South Boulevard in the 1990s.

Today, some of the shopping plazas that bustled with ethnic flair, such as Carniceria La Mexicana on Central, now look almost abandoned.

“These places are community centers as much as they are places to get food,” said Tom Hanchett of the Levine Museum of the New South. “So when you lose one of those, you're losing a grass-roots entrepreneur. But you're also losing a community connection.”

While not as critical to the economy as the banks, small ethnic businesses have played an essential role attracting shoppers, says Owen Furuseth, an urban studies professor at UNC Charlotte.

“They've been so powerful to turn around areas that were languishing or having economic difficulties,” he said. “To see them struggle is a sign that we need to be concerned about what impact this could have going forward.”

Not only Latino-owned businesses have been hit. Other banks, grocery stores and businesses have lost Latino customers as well.

Latinos, Furuseth says, “are not going to just stop going to the Latino-owned stores. They're going to stop going to all the stores.”

The Pew Hispanic Center recently reported that the median annual income of non-citizen immigrant households fell 7.3 percent from 2006 to 2007. During that same time it rose 1.3 percent for all U.S. households.

“In recent times, the economic fate of Hispanic immigrant workers has been more specifically tied to the housing and construction sectors,” the report states. “Thus, these workers enjoyed significant economic gains during the construction boom of the early part of this decade, only to experience a sharp decline starting in 2006.”

Hernandez of Carniceria La Mexicana has had to lay off 130 workers. Sales at his one remaining store on The Plaza are down more than 50 percent. Things were so slow on Monday afternoon that he didn't need anyone working the cash register.

“It's bad,” he said. “The same people who bought $200 of meat now stick with rice, beans and instant soup because they don't have money.”

Hernandez is confident the economy will turn around eventually. He just hopes he can survive until it does.

“For me, it's been like a cancer,” he said. “It started in a small spot and then got worse and worse and worse.”

http://www.charlotteobserver.com/408/story/711715.html

It isn't just the Latino's that are having this problem. It's all over the U.S. I have mixed feelings about this article, and perhaps just a little sympathy for "Hernandez". I think that if these people were here illegally, then they should go home to their own countries. He should of thought about how his clientel (where the heck is the spell check?) are illegals and taken that into considerations before expanding like he did. There were signs of the failing economy last year. Maybe he couldn't read or speak English? I'm being fresh!

Illegals are not welcome here if they choose to stay illegal. If they get working on citizenship, then that is another matter which I support somewhat.

I don't like having to pay for them with taxepayers money to get their citizenship though. Good grief, I pay more money in taxes now than I do on my mortgage!

If the illegal Latino's leave then maybe Americans can be the revitalizers?!!!

I would not be surprised one bit to see a lot more of American streets that were once hustle and bustle become like ghost towns. So for this particular street to have problems I say join the crowd, and welcome to reality!! It doesn't say in the article that these people are now homeless like a lot of Americans are! They should count their blessings they had it good for awhile.

http://www.mint.com/blog/finance-core/modern-day-ghost-towns-of-abandoned-real-estate/

This writer at the Observer only writes about "immigration issues", but only focuses on Latinos, even though I know there are quite a few Ukrainians, Latvians, Pakistanis, and other nationalities here. The other nationalities usually speak English and are here legally. The communities they live in are not exclusively filled with their countrymen, like Hispanic communities are.
I flipped on CSPAN one day and they were showing a session of the Canadian parliament. The representatives from Quebec spoke only in French (which had to be translated to everyone else) and they got English translated for them. I can just imagine what our Congress could ever get done if we have a load of non-English speakers getting elected, and the cost of translation would be enormous. It would be chaos, and if you think government moves like a sloth now...