Study: Worker shortages, border travel restrictions slowing recovery

Coronavirus

Drivers and servers in short supply, but international trade going strong and warehouse demand increasing, according to UTEP's Borderplex Business Barometer

Trucks crossing the U.S.-Mexico border. (AP photo)

EL PASO, Texas (Border Report) – A worker shortage in El Paso and ongoing border travel restrictions continue to stress the region’s retailers, a new economic snapshot from the University of Texas at El Paso shows.

That being said, overall labor market conditions in the El Paso-Las Cruces-Juarez area continue to improve thanks in part to high vaccination rates that have helped the community weather a worldwide surge of the coronavirus Delta variant.

“Some sectors of the Borderplex regional economy continue to face pronounced level of stress. Transportation companies continue to confront driver shortages, forcing many to forego new sales opportunities,” says the August report of UTEP’s Borderplex Business Barometer out Tuesday.

Other factors slowing the recovery include restaurants facing staffing difficulties. The report doesn’t address the causes of the worker shortage, but food franchise executives have blamed the lack of applicants for low-wage jobs on stimulus-enhanced unemployment checks and other collateral effects of the COVID-19 pandemic.

Non-essential border travel restrictions, as well as growth in e-commerce, have made a dent in new retail loan demand, which remains “noticeably weaker,” the report states. “At present, there is no end in sight for the non-essential travel restrictions, and that will continue to hamper retail activity in much of El Paso.”

But there are bright spots on the border’s economic landscape.

Warehouse construction in El Paso has accelerated due to high occupancy in existing units and because of the new Amazon project on the East Side. Also, international trade flows are strong, surpassing $10 billion in volume several months this year, according to the report.

“This has translated into consistently strong manufacturing orders throughout Northern Mexico. The only way for companies to fulfill those orders is to increase payrolls, something that has happened during several consecutive months in Juarez and Chihuahua City,” the report states.

The Borderplex Business Barometer is a product of the Border Region Modeling Project at UTEP.

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