Adopted Budget FY 2018-2019

As an indication of economic activity, sales tax increased this past fiscal year after a steady increase in prior
years.
At the MSA level, according to the Texas Workforce Commission, over the last 10 years the McAllen-
Edinburg-Mission MSA employment has grown from 283,272 in 2008 to 341,014 in 2018—a 20% increase.
At this level, the unemployment rate is 5%. Some of the more significant employment numbers by industry
include government, trade, transportation and utilities, education and health services; professional and
business services; and leisure and hospitality.
The City’s location allows it to take advantage of The Maquiladora “Twin Plant” Program, under which
U.S. firms locate manufacturing facilities in Mexico accompanied by warehousing facilities in McAllen’s
foreign trade zone. From 1988 through 2018 (the latest year available) on a calendar year basis, the
McAllen Economic Development Corporation has been responsible for bringing 324 new companies, that
including expansions, has created 24,438 jobs in McAllen. This effort has also resulted in 368 new
companies, that including expansions, has created 91,962 new jobs in Reynosa. Overall, 204,928 jobs have
been created.
Trade with Mexico, including the impact of the Renegotiated North American Free Trade Agreement
(NAFTA) now known at the new United States-Mexico-Canada Agreement (USMCA), as it continues to
develop, has also played a major role in increasing economic activity, including employment for the City
as well as the State of Texas. During 2017, Texas exported $97.7B to Mexico, which represented over
36.9% of Texas’ total exports--making Mexico its Number One Trading Partner. This level of trade
represents a 2.4% decrease from 2014. As USMCA continues to mature, the City of McAllen’s
international toll bridge, connecting Hidalgo, Texas with Reynosa, will continue to facilitate trade between
Mexico and the U. S.
The City’s unemployment rate has steadily declined since 2011, decreasing gradually to 5.10% in 2015.
The following year the rate went up prior to going back down in 2017 to 4.7%. This past year, the City’s
rate has increased to 5%.
14%
12%
10%
8%
6%
4%
2%
0%
7.50%
City of McAllen's Unemployment Rate
Ten Year History
7.40%
8.20%
7.80%
6.90%
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
6.30%
Fiscal Year Ending
5.10%
5.20%
4.70%
5.00%
Source: Texas Workforce Commission
2018-2019 Budget Message ii