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UTB-CBIRD Report: “At The Crossroads” Economic Development 91
The average annual wage in Cameron County in 2000 was approximately
$20,000, while for the State of Texas this figure was in excess of $35,000.
Three factors account for most of this disparity.
⇒ Cost of living drives wages up in the larger urban markets of the state;
these urban areas increase the average without creating upward
pressure on wages in less developed labor markets of the state.
⇒ Several Cameron County clusters are concentrated in lower value-added
activities.
⇒ Some clusters, most notably Construction, face downward pressure on
wages due to the available labor in the informal economy.
Table 5.2 compares average annual wages in Cameron County, as of 2000, for
each cluster to the average annual local wage, and to the average annual Texas
wage for each cluster.
The two clusters at the low end (less than 75%) of the local wage structure
(General & Personal Services and Recreation & Leisure) employ a total of
16,000 workers, approximately the same as the employment of the 14 clusters
at the high end of the wage scale (125% or greater). This average rate of low
wages may be explained in part by the substantial number of part-time laborers
in General & Personal Services and Recreation & Leisure. Indeed, wage rates in
these clusters are roughly in line with the generalized wage differential between
the County and the State. However, 20% more of Cameron County’s workforce is
engaged in these two low-wage clusters than is the case statewide.
Only one cluster in Cameron County, Aerospace & Defense, provides average
wages in excess of the Texas average. However, this cluster has only about
three regionally-based establishments with small and declining employment.
Also important to consider are the growing clusters in Cameron County that pay
less than 60% of the state average such as Business Services and Finance &
Real Estate. For example, these clusters are generally associated with larger
urban economies, providing a wide range of services to an active private sector.
With the region’s multinational manufacturing base, opportunities may be found
to expand these clusters, while also increasing local average wages.
County has developed high value added components of the cluster. The raw data do not account for
the lower cost of living in Cameron County, so Civic Economics has classified high and low wage
clusters based on 60% and 75% of Texas wages. The actual average annual wage in Cameron
County in 2000 was approximately 60% of the statewide average.
It should be noted that this wage data does not, and cannot, account for wages paid in what is
known as the informal economy. The informal economy, a reality for thousands of Texans, is made
up of those whose earnings are not reported to government agencies. For many, particularly those
with limited job skills or undocumented immigration status, the cash economy is the only alternative.
For others, a cash economy is chosen in order to skirt taxation or to evade law enforcement. In
neither case are their earnings reflected in this data.
One Region – One Future
It is estimated by the INS
that in October 1996,
Texas was home to
700,000 illegal
immigrants, which is 14%
of the national total.
Given the projected
annual increase, the total
number of illegal
immigrants in Texas
today is probably around
1,000,000. One million
is a large number of
people to insert into an
“informal” or cash
economy. The current
workforce in Texas’
“formal” economy is just
over 10 million people…
Statistics for projections on illegal
immigrants:
U.S. Dept. INS
“Estimates, Fiscal Year, 2000”
Statistics on TX workforce:
Texas Workforce Commission
December 2002