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US 83 Texas Corridor Initiative - Part 1

July, 2003 - produced by Wilbur Smith Associates with The Louis Berger Group and AECOM Consulting

Part 2 >


Project Type: Connectivity and circulation

Project Objectives: Promote and accommodate commercial development along a major highway with "Super Two" characteristics

Outcomes Metric: Revitalization potential, expected job gains, tax base effects, new businesses established

Economic Environment: Mixed-urban and rural

Economic History: The Laredo port of entry in the southern portion of the corridor is one of the busiest in the hemisphere, coupled with high rates of unemployment, poverty and declining population in the northern portion of the corridor.

Distinguishing Features: The U.S. 83 corridor study area includes the Counties of Webb, Dimmit, and Zavala. The socioeconomic and development characteristics of these counties vary significantly. Webb County has experienced considerable economic growth. In 2000, the Laredo port of entry accounted for roughly 41.2% of the total value in trade with Mexico, making it one of the busiest ports of entry for overland merchandise trade in the hemisphere. Dimmit and Zavala counties are very sparsely populated with 7.7 and 8.9 persons per square mile respectively. This compares to Webb County with 57.5 persons per square mile.

The map on the left shows that the national US 83 corridor generally follows the 100 degree west longitude line in the United States from Texas to North Dakota with the study US 83 corridor being in the south of the national US 83 corridor. The map on the right shows that US 83 is a generally North/South highway in the center of (from north to south) Zavada, Dimmit and Webb counties and connecting with I-35 near Laredo at the border between Texas and Mexico in south central Webb county.

I. Socioeconomic Profile

The U.S. 83 Texas study corridor (Webb, Dimmit, and Zavala Counties) represents approximately 120 miles of highway with "Super Two" (8' wide full depth paved shoulders adjacent to both 12' lanes) characteristics. U.S. 83 runs through the heartland of the U.S. from Mexico to Canada and has a strategic alignment to the major consumer markets in Mexico such as Monterrey and Mexico City.

Laredo Port of Entry

May 2001

photo of tractor trailers Socioeconomic characteristics for the counties in the study area vary significantly. Webb County, which includes the Laredo port of entry, has experienced economic growth due to location. In 2000, the Laredo port of entry accounted for roughly 41.2% of the total value in overland trade with Mexico, making it one of the busiest ports of entry in the hemisphere. The North American Free Trade Agreement (NAFTA), which has resulted in increased trade with Mexico, is the engine driving the economic growth and development at the border and in Laredo. [1] This has created a strong demand for trucking, warehousing, staging areas, and support service industries in the area. Dimmit and Zavala counties to the north are at the other end of the development spectrum. They are very sparsely populated and have higher rates of unemployment, poverty and declining population.

Laredo Border Crossing N & S
2000 Increase From 1990
9.1 M Pedestrians 27.5%
16.8 M Vehicles 24.4%
2.9 M Trucks (8,000 Daily) 314.3%
336 K Loaded Railcars 242%
459 M lbs. Landed Wt. Airport 897.8%

Source: Laredo, TX Chamber of Commerce

The phenomenal growth that Laredo has seen in the past five years is clearly related to the Laredo border crossing and NAFTA. Because of the varying degree of economic vitality in the study area, the different groups of stakeholders view transportation investment from an economic development standpoint differently. In Webb County, transportation improvements are viewed to improve economic development by accommodating more trade related economic stimulation. In Dimmit and Zavala counties, stakeholders view transportation improvements from the perspective of increased market access, improved competitiveness for attracting businesses and tourists, and improved quality of life.

Laredo Border Crossing

U.S.-Mexican border dynamics characterized by rising numbers in pedestrian, vehicle, truck, and railcar crossings and an increase in gross landed weight at the Laredo international airport, point to continued growth and development for Laredo and the region for some time to come. [2]

Study Corridor Socioeconomic Profile

The socio economic profile of the study corridor is summarized to emphasize the significance of current and future development opportunities. Dimmit and Zavala counties are very sparsely populated with 7.7 and 8.9 persons per square mile respectively. This compares to Webb County with 57.5 persons per square mile and the state and national average both of which were 79.6 persons per square mile. [3]

There are 254 counties in the state of Texas. Based on 1999 Census data, Webb County ranked 21, Dimmit County 164, and Zavala County 154 in population. Laredo has approximately 91% of Webb County's population and Nuevo Laredo on Mexico's side of the border has a population of more than 660,000. Webb County's population growth rate from 1990 to 2000 of 44.9% was approximately double the state's growth rate of 22.8%, considerably greater than the national average of 13.1%, and ranked 9th in the nation. This compares to -1.8% and -4.6% growth rates for Dimmit and Zavala Counties respectively. [4]

The poverty level for the study corridor is of concern. Webb County has a poverty level of 31.2% for people of all ages, Dimmit County 33.2%, and Zavala County 41.8%. The study area poverty levels are more than double the state average of 15.4% and for Zavala County more than triple the U.S. average of 12.4%. [5]

Educational attainment is also an issue. The percentage of the population 25 years and older, that has a high school degree or better, is 53% of Webb, 54.3% of Dimmit, and 43.4% of Zavala County. [6] The study corridor is well below the state average of 75.7%. This is undesirable from the standpoint of attracting employers who require potential employees with relatively high educational attainment.

Per capita personal incomes (PCPI) for the study area range from $11,351 to $14,112, which compares to the state average of $26,834. The 1999 PCPI reflected an annual increase of 2.1% for Webb County, 5.3% for Dimmit County, and 10.2% for Zavala County. [7]

 

County

State population Ranking

% State Average

% National Average

Webb

$14,112

239

53%

49%

Dimmit

$12,789

247

48%

45%

Zavala

$11,351

250

42%

40%

Source: Bureau of Economic Analysis, REIS

Average annual unemployment rates for the study area are considerably higher than the state and national averages. From 1990 to 2000, Webb County had a high of 15.3% and a low of 7.0%. Dimmit County had a high of 20.0% and a low of 12.7%. Zavala County had a high of 26.1% and a low of 15.3%. The state for the same time period had a high of 7.7% and a low of 4.2%. The U.S. for the same period had a high of 7.6% and a low of 4.1%. [8]

II. Industry Sector Analysis

An analysis of the major industry sectors in the study corridor was conducted to determine the relationship of highway improvements on their growth and sustainability. The location quotient is a measure of an industry's concentration in a local economy relative to the national concentration. In general, sectors with ratios greater than one, indicating higher than average participation, represent sectors of the economy that build wealth for a region, usually in terms of exporting services or goods to other regions. Location quotients for selected industries are provided.

Location Quotient for Employment in 2000

County

Transport and Utilities

Mining

Retail

Services

Webb

3.38

6.04

1.16

0.77

Dimmit

1.00

10.04

0.97

0.57

Zavala

0.65

-

0.48

0.95

Bureau of Economic Analysis by SIC Code

Transportation and Border Related Activity

Goods movement between the U.S. and Mexico has increased steadily and dramatically over the past decades. The growth rate accelerated during the 1990's to nearly double the growth rate of the 1980's. [9]

Average Annual Percent Change in Volume of Goods Traded
 

1980

1990

2000

1980-1990

1990-2000

U.S. - Mexico Trade

$28 billion

$58 billion

$207 billion

7.6%

13.6%

Source: Laredo Development Foundation

Growth in transportation and warehousing activity has resulted in increased employment. Transportation is a growing employment sector in Texas and the U.S., but Laredo easily exceeds the growth rates for these larger areas, in employment as well as earnings. The Laredo border-gateway location, with good crossings and good transportation on either side, provides a clear competitive advantage to the region. The advantage is being exploited through close cooperation with Nuevo Laredo in cross-border maquiladora development, outreach to industrial centers in Mexico such as Monterrey, and development of industrial parks, warehouses, and value-added distribution facilities, mostly to the north of Laredo.

Agriculture

Agriculture is a major industry and employer in the region, and is particularly significant in Dimmit and Zavala Counties, which have an extensive winter vegetable garden industry. Farm earnings in Zavala County have far surpassed Texas and U.S. growth rates at 6.0% compared to 3.4% and 1.3% respectively.

Del Monte, located on U.S. 83, is one of the larger employers in Zavala County. Since 1995, full time employment has risen to 130, a 47.7% increase. The plant also supports 800 part time employees who typically work 42-52 weeks per year. They typically receive 10 to 20 truckloads of raw vegetables and ship 40 to 50 truckloads of finished product per week. Another business significant to the corridor is Dixondale Farms located in Carrizo Springs on U.S. 83. Dixondale Farms produces and distributes approximately 60% of all the onion seed plants in the U.S. Twenty percent of their distribution is through mail order, primarily to Texas, California, New York, and Ohio, utilizing UPS and Fed-Ex services. They also serve Wal-Marts in 17 states.

Ranching has continued at a fairly steady pace, but many of the ranches now rely on hunting permits for substantial income. According to the Laredo Chamber of Commerce, deer hunting brought in an estimated $40 million in revenue to Webb County in 2000. Along U.S. 83, the local economy depends heavily on income generated during the hunting season, as hunters are good customers for the small retailers.

Retail Trade

Located near the Mexico border and the thriving city of Nuevo Laredo, and with one of Mexico's best roads leading from Monterrey to Laredo, Webb County in particular enjoys a diverse and vibrant retail trade sector. Nuevo Laredo has a population of more than 660,000, and Monterrey, Mexico, with a population of 3.9 million, is only two hours away, by good roads. Many people cross the border on foot or by car on a regular basis to take advantage of the prices and selection in U.S. stores.

The retail trade sector of the national economy has enjoyed steady growth. This sector has grown by 4.8% average annual change for Webb County and Dimmit and Zavala Counties have shown a steady growth rate of 5.2% and 4.9% respectively. The Laredo Wal-Mart is the busiest store for its size in the entire United States -- thanks largely to shoppers from Mexico. Average annual retail employment growth in Webb County out paces the State's growth rate.

Oil and Gas

Oil and gas extraction has clear boom and bust cycles, with volatility ranging from wildcat discoveries of new sources to tensions in the Middle East affecting oil futures and prices. Texas is the nation's leader in oil and gas extraction, producing approximately 58 percent of all U.S.-derived oil and gas. Oil and gas extraction comprises almost all the mining earnings for these three Texas counties. Three years ago the oil industry in Dimmit County started to turn around, and is in a period of recovery. As a result, the Eastern Oil Well Service Company, which services existing wells, has grown during this period. The company has 50 employees, and as such is a major employer in Dimmit County.

Part 2 >


[1] Chamber of Commerce, Laredo, Texas, Vision 2001, Economic Outlook Report, April 2001.

[2] Chamber of Commerce, Laredo, Texas, Vision 2001, Economic Outlook Report, April 2001.

[3] U.S. Census Bureau, 2001 estimate (Texas and the US had identical density)

[4] Laredo Texas Real Estate Market Overview, Real Estate Center, Texas A&M University.

[5] U.S. Census Bureau, 2001 estimate

[6] Ibid.

[7] Bureau of Economic Analysis, Regional Economic Information System.

[8] U.S. Bureau of Labor Statistics and Real Estate Center at Texas A&M University.

[9] Laredo Development Foundation. "Laredo Texas Bordering the Future", using data from Texas A&M University.

Updated: 05/04/2012
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