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Fear of immigration raids and job losses curb spending by Latino families. Coca-Cola and other brands in decline
The climate of fear generated by President Donald Trump’s new anti-immigration crackdown is also having repercussions on the US economy. According to the Wall Street Journal, immigration police (ICE) raids, intensified with the support of the National Guard and the Marines, have caused a drastic decline in consumption among Hispanic communities, even among those who are legal residents of the United States.
Many Latinos, fearful of being stopped for checks, are avoiding going out even for everyday activities such as shopping or eating out. The consequences are being felt by brands that have historically been strong among Hispanic consumers, such as Coca-Cola, which recorded a 3% drop in sales in North America in the first quarter of the year.
But the blow is spreading to the entire market: companies targeting Latinos, such as Constellation Brands (producer of Modelo beer) and El Pollo Loco, have reported to investors that the decline in spending among Hispanics is having a significant impact on their bottom lines.
To make matters worse, the loss of thousands of jobs in the construction and service sectors, caused by the raids, has drastically reduced the purchasing power of a crucial segment of the population. According to analysts, the domino effect of deportations now risks slowing down entire sectors of the US economy.
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