MSA: McAllen-Edinburg-Mission, TX
Best places ranking: #16 among midsize metro areas
Located just miles from the Mexican border, McAllen has hardly been immune to the recession -- the Rio Grande Valley is historically one of the poorest parts of the country, and its unemployment rate topped 11% in August. But the outlook isn't bleak. McAllen remains the retail center of both south Texas and northern Mexico, and it was the eighth fastest-growing city in the U.S. last year, according to the 2008 Census.
McAllen boasts a low foreclosure rate and cost of living, and city officials are actively working to improve the area's quality of life, including through the development of an entertainment district.
McAllen and its neighboring cities are poised to capitalize tremendously on cross-border commerce. Thirty-five percent of McAllen's retail market -- which sees more than $3 billion in annual sales -- comes from Mexican nationals who cross the border to shop, dine and entertain. The cross-border trade provides a cushion when the local economy slows down, although business leaders encourage entrepreneurs to maintain their focus on long-term growth on the American side. -Tina Peng
Resources for getting started in McAllen, TX
Local startup resources
McAllen Business Statistics
"It's pretty cool here -- there's an amazing entrepreneurial spirit. Anywhere you can drive, it's all local, independently owned small mom-and-pop businesses." -Jessica Delgado