Despite lowest wages in nation, area economic prospects look bright.
June 16, 2006
The Brownsville area received some mixed economic news last week. On the surface both can be seen as negatives, but taken in context they suggest the news could start getting much better in the near future.
The U.S. Department of Labor reported that the unemployment rate for the Brownsville-Harlingen-San Benito metropolitan statistical area was 6.6 percent for the month of April, about 30 percent higher than the state rate of 5.1 percent, and 46 percent higher than the national rate of 4.5 percent.
At the same time, Cameron County has the lowest weekly wages of all U.S. counties with at least 75,000 jobs. Local average weekly wages were $486 for the third quarter of 2005, compared to a $777 national average.
Hidden in these numbers, however, is good news. They tell us where we are, but also how far we’ve come.
In 1990 the areas’ unemployment rate was above 20 percent. The implementation of the North American Free Trade agreement saw rapid development in the area, on both sides of the border, as new opportunities have arisen. Local jobless rates have steadily fallen, especially over the past decade, following Mexico’s recovery from its 1995 monetary collapse.
Higher unemployment levels have meant more people with disposal incomes, and national retailers have taken notice. Stores and restaurants continue to move into and expand in the area, providing even more jobs — especially for people with limited skills who can work as cooks, waiters or inventory stockers.
Economists agree that full employment is impossible — we will always have a certain amount of transitional unemployment, people who are between jobs for short periods and for various reasons. Compared to the 18.5 percent jobless rate this area faced in 1996, the current rate of 6.6 is a relatively nice place to be.
To a point, we agree with Orlando Campos, director of recruitment and development at the Brownsville Economic Development Council; he said local wages should start going up. It’s safe to assume that falling unemployment means fewer people competing for available jobs, and employers will have to start offering higher salaries in order to attract workers.
Unfortunately, many factors keep downward pressure on local wages. Many people assume also that unemployment in the Brownsville area is likely to remain higher than other areas due to the constant immigration and high birth rate, which leads to large numbers of new people entering the work force every year. In addition, the retail jobs that have come in largest numbers to the area offer the lowest wages because they don’t require specialized skills.
Wage increases will continue to lag behind the rest of the country unless workers develop education and skills that can attract companies that can utilize them, and which offer better pay. The continued development of the University of Texas at Brownsville and Texas Southmost College is crucial. Brownsville has enjoyed the services of a community college for 80 years, but the higher-level university is only 15 years old, and many programs have only been established for a few years.
The Brownsville area will likely remain behind the state and nation in key economic areas. But its growth cannot be denied, and that growth promises to continue for the foreseeable future.
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