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LAREDO — It’s been a difficult spring for Gabriela Yanez and her business, a dress shop called La Novia, or The Bride.

The season typically brings teenage girls into her store to shop for prom dresses. But this year, demand has plunged. Sales dropped by about 60%, Yanez said.

Her store, which she has run for nine years with her husband, is located in the city’s downtown business district. One weekday afternoon in early April, several storefronts along the same street were boarded up, and just across the street from Yanez’s store, a clothing store advertises that it is in its final 30 days of operation.

“Everything must go,” reads a yellow sign hanging from the window.

Yanez has no clear explanation for the sharp plunge that came on over the past year, but she has definitely seen a decline in foot traffic.

“It’s been very strange this year,” Yanez said in Spanish. “We don’t know why.”

Some Laredo business owners suspect President Donald Trump’s immigration crackdown as a possible factor. In a border city like Laredo, where economic growth relies on cross-border traffic, tighter immigration policies can dramatically impact the viability of the community. New population estimates indicate just how drastically those policies have affected the once-boomtown of Laredo.

All across the country, a decline in international migration has led to a decline in population growth between 2024 and 2025, according to the U.S. Census Bureau’s population estimates released in March. No metro area in the U.S. has been hit harder than Laredo, where population growth came to a near halt after seeing one of its largest population jumps in two decades — down from 3.2% between July 2023 and July 2024 to just 0.2% between July 2024 and July 2025.

The Laredo metro area, which encompasses all of Webb County, is located along Texas’ southern border with Mexico and has a population of approximately 272,000 people. The city accounts for the majority of those residents with a population of about 261,000.

Laredo isn’t alone. Other border communities have experienced similar slowdowns due to a decline in international migration, which was likely an effect of the Trump administration’s crackdown on immigration and its mass deportation efforts.

A sharp decline

The Laredo metro area’s growth of just 0.2% was the slowest it had been since 2020-2021, when it grew by .02%, said George Hayward, a demographer with the U.S. Census Bureau.

Natural changes in population, such as births and deaths, remained stable for the area, as did domestic migration, defined as when people move to Laredo from other parts of the U.S.

“That made Laredo really dependent on the international migration component for its population change,” Hayward said.

Laredo, which sits 160 miles southwest of San Antonio, shares a close relationship with its twin city in Mexico, Nuevo Laredo, with thousands of people crossing between the cities every day and frequent collaboration between city officials. The two cities, which sit on opposite sides of the Rio Grande, were once one entity before the 1848 Treaty of Guadalupe Hidalgo established the river as the boundary between the countries.

Laredo’s drop in growth is in sharp contrast from when it jumped the year prior. Between July 2023 and July 2024, the Laredo metro area saw one of its biggest jumps in growth in more than 20 years with a 3.2% population growth, largely driven by international migration.

It was the largest bump in international migration since at least 2000, Hayward said. That year, the area had a net gain of 8,592 international migrants. The next year, between 2024 and 2025, that number dropped to 260 people.

“That was a tremendous drop,” Hayward said

However, that decline could be a return to normal, said Tracy Ayrhart, vice president of data and research for Texas 2036.

Zooming out to look at the long-term trend, the jump between 2023 and 2024 was more of an anomaly.

“What happened this past year, the most recent data, is actually more reflective of the growth trends long-term,” Ayrhart said.

But there is an indication that the decline in growth could continue.

Researchers at the Kinder Institute for Urban Research observed a continuing decline in the top 15 metro areas through September 2025, said Kevin Thomas, co-director at the Kinder Institute.

“What we have seen is that the decline is even sharper,” Thomas said.

The Kinder Institute’s data, which still needs to be verified by Census data, notably focused on a time period that only spanned Trump’s current term in office while the Census estimates also included the final six months of the Biden administration. The data focused solely on months under Trump suggest that the decline is linked to the administration’s policies.

Whether local officials within the Laredo metro area should be concerned about the lack of growth in the most recent data depends on how they have prepared.

“The big question really is, did they plan around the surge that happened, or did they plan around their long-term trends?” Ayrhart said.

Over-projection

Despite the struggles Yanez’s business and others in the downtown area face, Laredo is projecting an overall increase in sales tax revenue for the 2025-2026 fiscal year, signaling the city’s confidence that people will continue to shop or spend money within the city.

Last year’s revenues were also an increase from the year prior, evidence that the city continues to see strong economic activity. However, they did not amount to what the city had originally projected.

For the 2024-2025 fiscal year, the city had originally budgeted for $55.4 million in sales tax revenue but only brought in an estimated $54 million. This year, the city budgeted for $57.6 million in sales tax revenue.

City officials acknowledged that revenues fell short of expectations in their budget. “One possible reason is the effect of tariffs and other national economic factors, which may have led local consumers to cut back on spending,” read a line from the city’s budget.

Laredo’s location along the border has made international trade a staple of the metropolitan area, making trade tariffs an important issue for its economy. Today, Laredo is the No. 1 land port on the U.S.-Mexico border and the No. 3 port in the nation, handling $354 billion in total trade in 2025.

Revenue from property taxes also came in lower than expected. The city had budgeted for $121,365,233 in property tax revenue for 2024-2025 but experienced a slight shortfall of .22% in property tax revenue at $121,096,474. For the current fiscal year, the city is projecting $134,338,848 in property tax revenue, a $13.5 million increase that includes $4 million from new property.

This over-projection of revenue, if it were to continue, could spell trouble for the city.

“We know that population does drive a lot of how communities plan — to how they fund schools, roads, healthcare and services,” Ayrhart said. “And so the big question really is, did they plan around the surge that happened, or did they plan around their long-term trends?”

Laredo city leaders say they anticipate further growth, though not necessarily from international migration.

With the prospects for data centers and expansion of healthcare facilities, city leaders hope the creation of new jobs will draw migration to Laredo from other parts of the U.S.

“The mayor is preparing for all that, because business drive jobs and people to move over here,” said Victor Treviño Jr., an attorney and adviser to his father, Mayor Victor D. Treviño. “We’re medically underserved, so we have a-third of the doctors that are needed for a community our size. So, they’re going to have to come from elsewhere.”

Treviño added that city officials already anticipate a need for more housing due to the opening of a new headquarters for the Mexican customs agency, ANAM, in Nuevo Laredo. The Mexican government opened the new headquarters in January.

But if a slowdown in growth continues and the city brings in less revenue than anticipated, that can create a real problem for its sustainability, said Steven Craig, an economist with the University of Houston.

“It sort of just depends on how the city prepared and how they’re able to adjust,” Craig said, echoing Ayrhart.

Laredo could face a financial shortfall if it expands services for a population boom that never comes. No new residents means no new tax revenue.

Cities in the Upper Midwest that faced a population decline found themselves in this type of financial strain, Craig said. As their populations declined, so did their tax base. But because the physical size of the cities stayed the same, their public sector expenses went down very little.

Future growth

The consequences of a population drop extend beyond lower tax revenue. It could also mean a loss of available workers.

Because immigrants tend to be of working age, the drop in international migration could prompt Laredo to lose out on workers, said Thomas, of the Kinder Institute.

“You’re losing the most productive age group of your population,” he said. “That has impacts for the labor force, for example. How many workers are going to be available to do certain jobs in the economy?”

The area is also losing out on taxpayers because immigrants who lack permanent legal status pay indirect sales taxes, and they can pay property taxes.

“The amount of money the cities, the local governments would have, for example, to fund schools, is going to decline,” Thomas said. “The amount of money they might have to actually fund infrastructural development projects — repair roads, repair public transit systems, electrical grid systems — a lot of those publicly funded projects are not going to be as easy to fund when taxes decline.”

The silver lining is that a slowdown or decline in growth due to lack of international migration is reversible.

“In the short run, it’s going to be easier to replace those migrants than it is to replace births like if there’s a change in immigration policy,” he said. “It’s easier to go back to the normal population size than if you try to get back to the normalcy by encouraging people to have more babies.”

Reporting in the Rio Grande Valley is supported in part by the Methodist Healthcare Ministries of South Texas, Inc.

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