Workforce Development in El Paso: A view from the Dallas Fed Roberto Coronado AVP in Charge and Sr. Economist The views expressed in this presentation are strictly those of the author and do not necessarily reflect the positions of the Federal Reserve Bank of Dallas or of the Federal Reserve System. Any secondary distribution of this material is strictly prohibited. May be quoted with appropriate attribution to the author.
Outline 1. 60x30 TX 2. A perspective on El Paso 3. Role of Dallas Fed
Outline 1. 60x30 TX 2. A perspective on El Paso 3. Role of Dallas Fed
60x30TX Source: Texas Higher Education Coordination Board Members
60x30TX Source: Texas Higher Education Coordination Board Members
Outline 1. 60x30 TX 2. A perspective on El Paso 3. Role of Dallas Fed
El Paso s economy boomed in 2015 125 Index, Jan 2005 = 100 120 115 110 105 100 95 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 SOURCE: Federal Reserve Bank of Dallas
5 4 3 2 1 0-1 -2 as employment grew above average Percent, Dec/Dec, S.A. Average 1.5 3.8 3.8 3.5 2.6 2.6 2.4 2.2 2.0 2.0 2.0 1.9 2.1 1.6 1.7 1.7 1.3 1.0 0.9 0.6 0.2-0.2-1.2-1.0 3.0-3 -2.4 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Source: Federal Reserve Bank of Dallas.
Main economic drivers U.S. economy Mexico s economy Ciudad Juarez and the maquiladora industry Cross-border retail activity Government sector
El Paso follows the maquiladora industry 270 250 Thousands, SA Juarez Maquiladora Employment Index January 2008=100 Dec 15 250,250 115 110 230 210 Dec '15 109.4 105 190 El Paso Business Cycle Index 100 170 95 150 '08 '09 '10 '11 '12 '13 '14 '15 NOTE: El Paso Business Cycle is a composite index that includes employment, unemployment rate, retail sales and wages. SOURCE: INEGI and Dallas Fed 90
El Paso retail sales slow 2000: Q1 = 100 Peso/Dollar 140 130 120 110 El Paso Retail Sales 18 16 14 100 12 90 80 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Source: Texas Comptroller of Public Accounts, Federal Reserve Bank of Dallas Nominal Exchange Rate 10 8
El Paso s economy dependent on government, but health is a rising industry Location quotient in 2014 2 1.6 1.2 0.8 0.4 Mature Advanced materials Primary metal manufacturing Transportation Construction Government Education Retail Recreation & food services Business & financial services Health Star Transitioning Emerging 0-2.5-2 -1.5-1 -0.5 0 0.5 1 1.5 2 2.5 3 Percentage-point change in employment share, 2006 14 Note: Bubble size represents cluster share of metropolitan statistical area employment. Source: At the Heart of Texas: Cities Industry Clusters Drive Growth Federal Reserve Bank of Dallas, February 2016;
Only 43 percent of El Paso workforce has an Associate s degree or higher % of workforce 1995 35 2000 31.0 31.0 31.1 2005 30 25 23.7 24.6 26.2 27.3 28.2 27.7 2010 2015 20 15 18.0 16.2 15.0 10 5 0 Less than high school High school or equivalent Some college or Associate's degree Bachelor's degree or advanced degree Note: Note: Excludes Educational Attainment not Available (workers aged 24 or younger) Source: U.S. Census Bureau, Center for Economic Studies, LEHD; Q3 data for El Paso Metropolitan
Yet, they have the highest earnings Average Monthly Income, Dollars 5000 4500 4000 $1,564 $5,049 3500 3000 2500 $553 $554 $3,485 2000 $2,931 1500 $2,378 1000 500 0 Less than high school High school or equivalent Some college or Associate's degree Bachelor's degree or advanced degree Note: Dollar amount above bars is average monthly premium compared to one level of education higher Note: Excludes Educational Attainment not Available (workers aged 24 or younger) Source: U.S. Census Bureau, Center for Economic Studies, LEHD; 2015 Q3 data for El Paso Metropolitan
Where a 2-year degree pays the most Associate s Degree Wage Premium* Industry Monthly Premium 1 Office of Physicians $1843 2 Health and Personal Care Stores $881 3 Computer Systems Design and Related Services $860 4 Automobile Dealers $761 5 Agencies, Brokerages, and Other Insurance Related Activities $757 6 Architectural, Engineering and Related Services $748 7 Scheduled Air Transportation $676 8 General Medical and Surgical Hospitals $653 9 Depository Credit Intermediation $637 10 Wired Telecommunications Carrier $625 *Some college or Associate s degree Note: Excludes Educational Attainment not Available (workers aged 24 or younger) Source: U.S. Census Bureau, Center for Economic Studies, LEHD; Q2 data for El Paso MSA
Outline 1. 60x30 TX 2. A perspective on El Paso 3. Role of Dallas Fed
Financial Literacy Financial literacy is strongly correlated with an ability to make wiser choices and realize better outcomes National surveys suggest Texans have a relatively low level of financial literacy that can adversely affect decision-making. 60+ percent of Texas survey respondents haven t planned for retirement. Texans also fare poorly when it comes to having a bank account. Source: Anthony Murphy, Policy Advisor and Senior Economist, Dallas Fed, High School Financial Literacy Mandate Could Boost Texans Economic Well-Being, Southwest Economy, 1Q:2016,
Regional Partnerships and Initiatives Borderplex Workforce Solutions Texas Higher Education Coordinating Board Region 19 Borderplex Economic Alliance Local School Districts Local Chambers of Commerce Business and Community Leaders
Other District Resources
Workforce Development in El Paso: A view from the Dallas Fed For more information visit www.dallasfed.org The views expressed in this presentation are strictly those of the author and do not necessarily reflect the positions of the Federal Reserve Bank of Dallas or of the Federal Reserve System. Any secondary distribution of this material is strictly prohibited. May be quoted with appropriate attribution to the author.