Valley Leads Job Growth for Texas, USA, and Mexico

Dynamic Growth in the Rio Grande Valley
By José Joaquín López
Dallas Fed

Texas Manufacturing employmentIts proximity to Mexico and fast-growing, binational job market are major factors in the Rio Grande Valley’s economy. They’re a large part of the reason employment has increased at a faster, steadier pace in the Valley than in the United States, Mexico or Texas as a whole. Despite rapid job creation, the Valley remains relatively poor. The McAllen–Edinburg–Mission metropolitan statistical area ranks last among the nation’s 361 MSAs, with a per capita income of $15,184 a year, less than half the national average of $31,472. The Brownsville–Harlingen MSA comes in next to last at $16,308.

The combination of rapid job growth and low income is unusual. In a study covering 1967 to 1997, Dallas Fed economist Keith Phillips found weak employment gains in other states’ low-income counties—annual averages of 2 percent in Kentucky, 0.4 percent in West Virginia and 0.3 percent in Mississippi. Valley employment, by contrast, rose 3.4 percent a year over the three decades.

Southwest Economy

Issue 2, March/April 2006
Federal Reserve Bank of Dallas

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