Desert landscapes characterize the Upper Rio Grande region. Located on the northern end of the Chihuahuan desert, the region’s open spaces fill vast areas between the Davis, Franklin, Guadalupe and Chisos mountains. Despite its dry climate and sparse population, the region has developed a unique industrial mix that relies on international trade and its strategic location between the U.S. coasts.
Fort Bliss covers 1.1 million acres and hosts an active force of more than 14,000 with a supporting community population exceeding 120,000.
The military has played a large role in the area’s economy since the early years of Texas statehood. Military outposts built in the El Paso area during the Mexican-American War spurred the city’s development and led to the establishment of Fort Bliss in 1848.1 Today, Fort Bliss covers 1.1 million acres and hosts an active force of more than 14,000 with a supporting community population exceeding 120,000.2
Manufacturing is a traditional pillar of the regional economy. Jobs in the production of goods such as vacuum cleaners and men’s footwear, as well as in copper refining, continue to outpace national counterparts. Service industries that support manufacturing, such as wholesaling and transportation, have evolved to become important industries as well.
Another traditional pillar of the region’s economy is the agriculture industry. Sixty-one percent of the land and 71 percent of the water in the region are used for either farming or ranching.
As with the rest of the nation, the region’s future growth will depend less on its traditional goods-producing industries and more on service jobs, such as professional and business services.
Exhibit 2 shows employment projections for the Upper Rio Grande region through 2013, including El Paso, the region’s sole metropolitan statistical area (MSA), and the five predominately rural counties. These expected changes are presented in the form of growth indices using 2003 as the base year, with an index equal to 100.
The region has experienced job growth similar to that of the state as a whole. The Comptroller expects regional employment growth to accelerate from 2009 to 2011 with additional troops stationed at Ft. Bliss. Employment in the El Paso MSA should see similar growth, rising by 1.7 percent in 2009 and 2.9 percent in 2010. After a slight decline in 2008, job growth in the non-metro counties should resume in 2009, with growth accelerating through 2013.
Government employment is expected to rise each year except 2012, with nearly 95,000 jobs projected by 2013. This will represent the largest share of the region’s economy, at more than 27 percent.
Upper Rio Grande Region Employment Indices, 2003-2013
Source: Economic Modeling Specialists Inc.
Industry Employment Projection Indices, Upper Rio Grande Region, 2003-2013
Source: Economic Modeling Specialists Inc.
In 2008, employers in the Upper Rio Grande region provided a total of 305,657 jobs. Exhibit 3 provides a detailed picture of projected employment growth in the region, displaying growth indices for various industries in the region, using 2003 as the base year. Employment for these industries is presented at the 11-industry “supersector” level of the North American Industry Classification System (NAICS).6
A supersector, as identified by a two-digit NAICS code, represents an aggregation of industries producing related goods and services. At this level, industries are classified into either goods-producing or service-producing supersectors.
The goods-producing group comprises three supersectors – agriculture, natural resources and mining, construction and manufacturing. The service-producing group comprises seven supersectors including education and health, finance, government, information, leisure and hospitality, other services and trade, transportation and utilities.
Eight of the 11 supersectors in Exhibit 3 should show positive growth between 2003 and 2013, with exceptional growth in professional and business services. In all, Upper Rio Grande employment should rise by 24 percent over this period, despite the current national downturn.
Of the eight supersectors projected to add jobs by the period’s end, two will show steady expansion. Government employment is expected to rise each year except 2012, with nearly 95,000 jobs projected by 2013. This will represent the largest share of the region’s employment, at more than 27 percent.
The professional and business services sector is also expected to add jobs each year except in 2012, led by strong growth in telemarketing bureaus. These businesses added 3,200 jobs to the region in 2004 alone, and should finish the 2003-2013 period with at least 7,400 jobs. Collection agency growth should make a significant contribution as well, after jumping from 123 jobs in 2004 to 1,127 jobs in 2005. Both industries are concentrated in the El Paso area, attracted by its strategic location for the e-commerce and telecommunications industries (offering easy access to an extensive network of fiber-optic lines), in addition to a young and skilled bilingual work force.7 As a whole, the professional and business service supersector should increase employment by 79 percent from 2003 to 2013.
Despite various industry downturns during the period, other supersectors show strong projected job growth through 2013. Expected growth in the construction suppersector – by nearly 50 percent – trails only that for professional and business services, despite a slowdown in 2004 and the current economic downturn. Employment in commercial building construction and non-residential drywall installation should account for 33.5 percent of all construction jobs added through 2013.
Educational and health services employment should rise by 39 percent through 2013, driven by positive growth in home health care services. Home health care will contribute more jobs to the supersector than any other industry, representing 40 percent of projected regional job creation by the period’s end. The next strongest health-related industry in terms of expected growth is physicians’ offices, accounting for 13.5 percent of the projected job growth through 2013. Educational industries should see more modest growth.
Other regional industry sectors anticipating positive job growth rates over the period include leisure and hospitality (32 percent), trade, transportation and utilities (19 percent), other services (13 percent) and financial activities (12 percent).8
PHOTO: Village Farms
Job growth depends upon a region’s underlying economic structure. That structure includes multiple factors including natural resources, labor force characteristics and the composition and concentration of the region’s industries.
This latter characteristic, also called clustering, is particularly important since industry clusters give firms within them access to more suppliers and a pool of skilled laborers with valuable knowledge and information.16 The benefits that result from high industry concentrations give a region its competitive edge.17
One tool that can be used to identify industry concentration is the “location quotient.” The location quotient identifies industry concentrations by comparing the share of a region’s economy attributable to a specific industry to the share that same industry accounts for in the nation’s economy.
In essence, the share an industry accounts for in the national economy is seen as the “norm” for that industry, so comparing that norm with its share of a regional economy indicates whether that region tends to have “a lot” or “a little” of a particular industry. Typically, a region will contain “a lot” of industries for which it has some natural or developed competitive advantage, based for instance on a local abundance of a particular resource, a favorable climate, an advantageous natural feature (such as proximity to a port), a highly educated labor force or some other factor.
A location quotient greater than one indicates a high regional employment concentration in an industry compared to the same industry at the national level. This means that the region is “specialized” in that particular industry. A location quotient of less than one indicates that the region’s concentration in the industry is less than the national industry level. In essence, the region is less specialized in that given industry.
Exhibit 4 lists industries in the Upper Rio Grande region with location quotients exceeding two based on 2008 employment, meaning the region’s share of employment in an industry is at least twice as large as the nation’s share. These industries are grouped according to their respective NAICS supersectors and ranked from the highest to lowest location quotient within each supersector.18
The manufacturing of household vacuum cleaners has the region’s highest location quotient, with a measure of 88.24. In other words, the industry’s level of employment in the Upper Rio Grande region is more than 88 times larger than the nation’s share.
Most Competitive Industries
While location quotients provide important information on regional industry concentrations, they offer only a snapshot – a static measure at a particular point in time. To assess the competitive resilience of a regional industry, a more dynamic measure is needed. One such measure is “shift-share analysis.”
In this analysis, the change in an industry’s regional presence is divided into three components: the portion attributable to the overall growth or decline in the nation’s economy (the national growth effect); that attributable to the difference between the national trend for an industry and the national trend for all industries (the industry mix effect); and that attributable to the region’s competitiveness as a site for the industry (the regional competitiveness effect).
Exhibit 5 lists the Upper Rio Grande region’s most competitive industries based on shift-share analysis. The industries are ranked based on their employment change in the regional competitiveness component (and thus the industry’s comparative advantage in the region) between 2002 and 2008.
The highest-ranked industry is telephone call centers, which generated 4,568 jobs between 2002 and 2008. Local factors (from the competitiveness effect) contributed 4,446 jobs, or 97 percent of this increase. The remaining growth was due to a growing national economy and industry growth outpacing overall national growth.
Another, similar example is the computer systems design industry, for which local conditions contributed 88 percent of job growth. Industries such as these that have favorable local conditions (such as an extensive infrastructure or favorable government policies) combined with a growing national industry have the highest potential for future growth.
Good Jobs for the Future
Shift-share analysis identifies the region’s most competitive industries – those that possess the best chances for increased employment opportunities. But what types of occupations can Upper Rio Grande residents expect to find within these industries? Exhibit 6 presents a list of “good jobs” for the region’s future, grouping them based on their educational requirements.
For the purpose of this analysis, a “good job” is one for which the weighted average of median annual earnings, as reported by the Texas Workforce Commission, exceeds the state’s 2007 per capita personal income level of $37,187.21 In the Upper Rio Grande region, 227 occupations pay more than this amount.
Occupations requiring doctoral and professional degrees command the highest annual earnings, with weighted median earnings of $84,961 for the region. Occupations requiring both a college degree and work experience provide the second-highest earnings, with weighted median earnings of $68,841. Occupations requiring a master’s degree ranked third, with a weighted median of $61,419.
Occupations in the region requiring postsecondary vocational training provide weighted median earnings of $41,985 annually. Occupations requiring an associate degree (without work experience) yield slightly higher earnings than those requiring a bachelor’s degree (again, without work experience). Associate degree occupations offer weighted median earnings of $49,864, while bachelor’s degree occupations offer weighted median earnings of $49,033.
It should be noted that many occupations that meet the “good jobs” definition do not require a college degree. A number of occupations requiring related work experience, on-the-job-training or postsecondary vocational training also provide good wages. At a weighted median of $49,557, jobs requiring work experience but no postsecondary education provide higher earnings than jobs requiring a bachelor’s degree without work experience, at $49,033.
Exhibit 7 lists 25 occupations expected to have the highest number of job openings in the Upper Rio Grande region between 2008 and 2013. Retail salespersons top the list, with 3,487 new job openings through 2013 and median annual earnings of $17,016.22
Eleven of the 25 occupations require only short-term, on-the-job training. These provide median annual earnings ranging between $13,411 and $18,066. Three of the occupations require a bachelor’s degree, including elementary, middle and secondary school teachers.
Occupations with the Most Projected Job Openings, Upper Rio Grande Region, 2008-2013
|Rank||Description||2008 Jobs||2013 Jobs||Total Job Openings||Growth||Replacement||2008 Median Annual Earnings|
|3||Cashiers, except gaming||8,396||9,157||3,014||761||2,253||$14,358|
|4||Waiters and waitresses||5,413||6,285||2,346||872||1,474||$13,843|
|5||Combined food preparation and serving workers, including fast food||10,009||11,184||2,123||1,175||948||$13,926|
|6||Personal and home care aides||4,701||6,014||1,721||1,313||408||$13,411|
|7||Customer service representatives||4,238||5,304||1,682||1,066||616||$23,031|
|8||Elementary school teachers, except special education||5,961||6,814||1,511||853||658||$59,987|
|11||Office clerks, general||5,964||6,608||1,189||644||545||$18,066|
|13||Laborers and freight, stock, and material movers, hand||5,484||5,607||959||123||836||$16,789|
|14||Secondary school teachers, except special and vocational education||3,693||4,074||933||381||552||$61,223|
|15||Janitors and cleaners, except maids and housekeeping cleaners||4,689||5,152||911||463||448||$16,583|
|16||Truck drivers, heavy and tractor-trailer||5,875||6,249||877||374||503||$38,151|
|17||Secretaries, except legal, medical, and executive||6,323||6,641||817||318||499||$22,578|
|18||Stock clerks and order fillers||4,189||4,324||808||135||673||$16,789|
|19||Middle school teachers, except special and vocational education||2,907||3,289||702||382||320||$59,390|
|20||Bookkeeping, accounting, and auditing clerks||3,785||4,156||666||371||295||$26,698|
|22||First-line supervisors/managers of retail sales workers||2,774||3,119||652||345||307||$30,385|
|23||General and operations managers||3,553||3,773||647||220||427||$64,622|
|24||First-line supervisors/managers of office and administrative support workers||2,986||3,304||628||318||310||$36,421|
|25||Correctional officers and jailers||2,058||2,432||614||374||240||$31,662|
Source: Economic Modeling Specialists Inc.
One of the many functions of the Texas Comptroller of Public Accounts is to analyze demographics, labor force statistics and other economic factors needed to generate local economic growth, and to provide this information to local governments and other groups. Through its Texas EDGE (Economic Data for Growth and Expansion) program, the agency can identify occupational and industry trends and their effects on local and regional economies.
Since August 2008, the Comptroller has responded to 549 Texas EDGE requests from city and county government officials, economic development corporations, private businesses and members of the media. These requests have covered many topics including demographics, economic development, economic modeling and taxes.
The Comptroller also can provide local demographic data, identify business clusters and provide maps of regional roadways and waterways. For assistance, please visit Texas EDGE or e-mail email@example.com.
The agency also provides local governments with information about tax-related programs and helps them identify opportunities to raise funds for economic development efforts through property, sales and franchise tax revenues, exemptions and credits. The agency also provides information on special assessments and other opportunities related to disaster relief.
The Comptroller’s Texas Ahead web portal provides information on tax programs and incentives, best practices and economic indicators, as well as reports and publications such as a recent report on Texas work force training entitled Texas Works. Texas EDGE also allows users to build customized models using region-specific data of their choosing.
Finally, the Comptroller’s State Energy Conservation Office (SECO) can help local governments slash their energy costs and adopt cost-effective clean energy technologies. SECO offers local governments a free preliminary energy audit of their facilities. These audits provide recommendations for reducing electricity consumption by improving the efficiency of heating and air conditioning systems and lighting. SECO is anticipating an influx of federal funds through the American Recovery and Reinvestment Act to help local governments save energy, create or retain jobs, increase energy generation from renewable resources and reduce greenhouse gas emissions.
PHOTO: Virginia Reza, Fort Bliss Monitor
All links were valid at the time of publication. Changes to web sites not maintained by the office of the Texas Comptroller may not be reflected in the links below.
- 1 Laven Publishing, “History of Fort Bliss,” http://www.lavenpublishing.com/history1.html. (Last visited May 4, 2009.)
- 2 Texas Office of the Governor, Texas Military Preparedness Commission’s Master Plan for 2008 (Austin, Texas, August 12, 2008), pp. 21-22, http://governor.state.tx.us/files/military/masterplan.pdf. (Last visited May 4, 2009.)
- 3 United States Army, Installation Management Agency, Southwest Region, “Bliss History,” https://www.bliss.army.mil/garrison/sites/about/history.asp. (Last visited May 4, 2009.)
- 4 E-mail communication from Angela Fernandez, El Paso Regional Economic Development Corporation, El Paso, Texas, March 6, 2009; and Texas Office of the Governor, Texas Military Preparedness Commission’s Master Plan for 2008, pp. 4, 22.
- 5 El Paso Regional Economic Development Corporation, “Regional Growth” http://www.elpasoredco.org/RetailDevelop-RegionalGrowth.aspx. (Last visited May 5, 2009.)
- 6 U.S. Bureau of Labor Statistics, “NAICS Supersectors for CES Program” http://www.bls.gov/sae/saesuper.htm. (Last visited May 4, 2009.)
- 7 E-mail communication from Jessica L. Herrera, research coordinator, city of El Paso, Texas, May 4, 2009.
- 8 Data provided by Economic Modeling Specialists, Inc., “Jobs by Industry Report.” The “Other Services” sector represents all industries covered under the two-digit NAICS code 82. These are industries primarily engaged in the provision of repair and maintenance services for automotive, electronic, commercial and industrial machines and equipment. The sector also includes personal services such as laundry, dry cleaning, hair, nail, and skin care, funeral parlors and organizations that have religious, social advocacy, civic, political and business purposes.
- 9 Data provided by Carl Anderson, Texas A&M Agrilife Extension Service, 6/1/09.
- 10 U.S. Department of Agriculture, 2007 Census of Agriculture (Washington, D.C., February 2009), Table 8, http://www.agcensus.usda.gov/Publications/2007/Full_Report/Volume_1,_Chapter_2_County_Level/Texas/st48_2_008_008.pdf (last visited June 4, 2009); and data provided by Texas A&M Agrilife Extension Service.
- 11 Data provided by Texas A&M Agrilife Extension Service.
- 12 U.S. Department of Agriculture, 2007 Census of Agriculture, Table 8.
- 13 Data provided by Texas A&M Agrilife Extension Service.
- 14 Phone interview with Rob Hogan, District Economist for District 6 of the Texas A&M Agrilife Extension, Ft. Stockton Texas, 6/3/09.
- 15 Data provided by Texas A&M Agrilife Extension Service.
- 16 National Governors Association, A Governor’s Guide to Cluster-Based Economic Development (Washington, D.C., 2002), p. 9, http://www.eda.gov/ImageCache/EDAPublic/documents/pdfdocs/nga_5fclusters_2epdf/v1/nga_5fclusters.pdf. (Last visited May 4, 2009.)
- 17 Laila Assanie and Mine Yücel, “Industry Clusters Shape Texas Economy,” Southwest Economy (September/October 2007), pp. 1-8, http://dallasfed.org/research/swe/2007/swe0705b.cfm. (Last visited May 4, 2009.)
- 18 U.S. Bureau of Labor Statistics, “NAICS Supersectors for CES Program.”
- 19 Cattleman’s Steakhouse, “About Us,” http://www.cattlemansranch.com/aboutus.htm; “Cattleman’s Steakhouse at Indian Cliffs Ranch,” http://www.cattlemansranch.com/PDF/CattlemansBrochureFrontOpt1.pdf; “Cattleman’s Steakhouse at Indian Cliffs Ranch near El Paso, Texas,” http://www.cattlemansranch.com/index.html; and Cattleman’s Steakhouse, “Menu,” http://www.cattlemansranch.com/menu.htm. (Last visited May 5, 2009.)
- 20 Indian Cliffs Ranch, Indian Cliffs Ranch: The Premiere Movie Set Location Near El Paso, Texas” http://www.elpasomoviesets.com/. (Last visited May 5, 2009.)
- 21 U.S. Bureau of Economic Analysis, “State Personal Income 2007,” Washington, D.C., March 26, 2008, p. 6, http://www.bea.gov/newsreleases/regional/spi/2008/pdf/spi0308.pdf. (Last visited May 4, 2009.)
- 22 Data provided by Economic Modeling Specialists, Inc., Fastest Growing Occupations”; and Texas Workforce Commission. “Wage Information Network,” http://www.texasindustryprofiles.com/apps/win. (Last visited May 5, 2009.) Custom queries created.
- 23 El Paso Texas Convention and Visitors Bureau, “Shopping,” http://www.visitelpaso.com/shopping.sstg; “Gallery Hopping in Marfa,” New York Magazine (October 11, 2006), p. 1, http://nymag.com/travel/weekends/marfa/index2.html; and Marfa Chamber of Commerce, “Galleries,” pp. 2-3, http://www.marfacc.com/art/galleries.php. (Last visited May 5, 2009.)
- 35 Gage Hotel, “Gage History,” http://www.gagehotel.com/history.html; Gage Hotel, “Spa/Fitness,” http://www.gagehotel.com/spa_fitness.html; Gage Hotel, “Weddings,” http://www.gagehotel.com/weddings.html; and Gage Hotel, “Accommodations,” http://www.gagehotel.com/accommodations.html. (Last visited May 5, 2009.)
- 36 Hotel Paisano, “The Hotel Paisano,” http://www.hotelpaisano.com/pages/hp001.html. (Last visited May 5, 2009.)
- 37 Holland Hotel, “History of the Holland Hotel,” http://www.hollandhotel.net/hotelhistory.htm; and “How to find the Holland Hotel in Alpine, Texas,” http://www.hollandhotel.net/map.htm. (Last visited May 5, 2009.)
- 38 Camino Real El Paso, http://www.caminoreal.com/elpaso_i/historia.php (Last visited June 4, 2009).
- 39 Data and estimates provided by the Texas Comptroller of Public Accounts; interview with Spencer Anderson, front desk manager of the Holland Hotel, Alpine, Texas, April 14, 2009; and interview with Joe Duncan, owner of the Hotel Paisano, Marfa, Texas, April 14, 2009.