Latino Businesses Flourish In Detroit

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Maria Villareal (right), owner of Tamaleria Nuevo Leon, and helper Margarita Gamino make tamales in Villareal's store in the Mexican Town district in Detroit two years ago. Detroit's Mexican community has seen a 34 percent increase in small business development in just the past three years. Carlos Osorio/AP hide caption

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Carlos Osorio/AP

Maria Villareal (right), owner of Tamaleria Nuevo Leon, and helper Margarita Gamino make tamales in Villareal's store in the Mexican Town district in Detroit two years ago. Detroit's Mexican community has seen a 34 percent increase in small business development in just the past three years.

Carlos Osorio/AP

With a stratospheric unemployment rate and major job loss throughout Detroit, it seems there's no room for small businesses to thrive.

But despite the city's severe economic problems, it appears its Hispanic business community is flourishing.

Detroit's Latino population has more than doubled in the past 10 years. Mexicans came in droves during the 1990s and continue to trickle in. There are roughly 400,000 Latinos in Michigan; half of them live in Detroit. Many work in construction, landscaping and the service industry. But hundreds have opened food-related businesses.

A Growing Demand For Mexican Food

Sitting in the shadow of the Ambassador Bridge, a busy border crossing in the U.S., is an unusual Detroit neighborhood, one with beautiful homes and manicured lawns. It's known as Mexican Town.

The buildings are renovated and the main street bustles. There are bakeries, family-owned grocery stores like Algo Especial, and a thriving restaurant scene. Nearly 30 new Mexican restaurants have sprung up here in just the past few years.

Mexican immigrant Norberto Garita opened one of them. He trained by making salads at other restaurants and became sous chef. Then Garita opened his own restaurant, El Barzon.

Garita says he opened his restaurant in Detroit because of cheap rent and the chance to buy his own building. His cooking style has garnered rave reviews, making El Barzon a Mexican Town favorite.

Lydia Gutierrez owns Hacienda Mexican Foods. Her company turns corn into tortillas and chips, which are sold in stores and restaurants in 15 states. The business started with two employees in 1990 -- but now operates out of three buildings with more than 100 workers.

Gutierrez says that three years ago, she needed more space and bought a 33,000-square-foot building here.

"The need for Mexican food products continues to grow in demand, where at one time, 10 to 15 years ago primarily, the Mexican food was primarily for Mexicans," she says. "It's continued to grow because of the exodus of people from Mexico to the United States -- and teaching the Americans how to eat this wonderful product, these wonderful tortillas."

Entrepreneurial And Good Spenders

Experts say Detroit's Mexican community has seen a 34 percent increase in small business development in just the past three years. Jim Johnson, who teaches economic development at the University of North Carolina and studies the Hispanic business community, says Mexican immigrants are among the most entrepreneurial, spurring significant new business growth.

"Even in areas and sectors of the economy where you have massive job loss, the one population that typically is growing is the Hispanic labor force," he says.

Johnson says some of the economic boom in Detroit's Hispanic community is because Latinos are good spenders.

Research shows that only about 20 percent of the money goes home through remittances, so the remaining 80 percent is spent in our local economy.

He adds that with little fanfare, immigrants are generating new economic development as well as jobs at astonishing rates, especially in Detroit's small business sector.