Financial Insecurity is on the Rise and Hitting Latinas the Hardest
David R. Jones, La Nueva Mayoria / The New Majority
With the cost of living on the rise and the city growing more expensive, a growing number of New Yorkers are finding it harder to establish financial stability and are living from one paycheck to the next. This is according to the most recent report by the Community Service Society of New York, “Teetering on the Edge: The Unheard Third Survey reveals pervasive financial insecurity among New Yorkers,” which is based on data from the 2023 Unheard Third Survey.
Although financial stability in New York has declined overall for everyone, regardless of their income, gender or race, the city’s Hispanic community has been particularly vulnerable to financial insecurity. This is especially true for Latina women. According to the report, Latina women are the most likely racial/ethnic group to have high levels of financial stress, with 40 percent reporting they worry all or most of the time about meeting household expenses.
One metric that can tell us a lot about someone’s financial insecurity is how much they have saved for a rainy day. Overall, the proportion of responders, both low-income and moderate-income, with zero savings increased in 2023. Among Latino New Yorkers, one in five responders had no money saved for a rainy day and the situation was even more concerning for Latina women, 25 percent of whom reported having no savings to fall back on. Latino New Yorkers were most likely among all racial/ethnic groups (28 percent) to resort to borrowing from family and friends to meet an emergency expense, suggesting a lack of access to formal banking institutions.
Disparities in savings along gender and racial lines stem directly from ongoing disparities in pay. Women in New York who work full-time, year-round earn 88 cents for every dollar their male counterparts make. However, the disparity is even more pronounced and enduring for women of color. In 2022, Latina women in New York earned just 59 cents for every dollar non-Hispanic white men made.
In 2022, New York City’s pay transparency law went into effect, requiring most employers in New York City to post salary ranges in job advertisements. This law has been instrumental in addressing the gender pay gap among new hires. A new law (Int. 808) introduced by the NYC Council in 2024 would strengthen the Salary Range Transparency law by discouraging employers from posting overbroad salary ranges that undermine transparency and expanding the scope of transparency by requiring employers to disclose pay ranges to current employees, among other things.
Further legislation on pay data reporting, which require companies to gather and distribute information on average and middle-range pay differences, as well as pay information that has been anonymized and disaggregated by race, gender, and ethnicity will help to pinpoint and address problematic disparities.
Other underlying issues contributing to financial insecurity among low- and moderate-income New Yorkers, and particularly women of color, require budgetary solutions. Unaffordable housing stands out as a prime example of this issue. The authors of the “Teetering on the Edge” report provide numerous recommendations for city and state policymakers to consider in tackling these issues. These include increasing cash benefits to reflect increased cost of living, improving and expanding access to the Empire State Child Credit (ESCC) and the Earned Income Tax Credit (EITC), fully funding and expanding the CityFHEPS housing voucher program, and expanding access to affordable banking and financial services.
Clearly, we are not short of solutions to help low- and moderate-income New Yorkers cope with the rising cost of living and the financial stress it imposes on them and their families. Our city and state leaders have stepped up before to fight for policies and initiatives that address inequities and provide the stability our most vulnerable citizens need to move ahead economically. We need them to show that leadership now.