McALLEN — A positive month of sales tax revenues in October marked a full year of growing sales tax for the city, a trend that city leaders are enthused by, after nearly two years of declining sales tax revenues.

The city collected $5.5 million in sales tax revenues in October, up more than $1 million from October 2017.

“It’s up everywhere in the Valley, it’s great,” said McAllen City Manager Roel “Roy” Rodriguez.

The Federal Reserve Bank of Dallas studied the strong South Texas economy over the last year, which it published in a recent report on the McAllen metro area. One cause the Dallas Fed pointed to was a young, growing population that provides for a deep labor pool for job growth in the region.

Local leaders have attributed the region’s sales tax growth to the La Plaza Mall expansion, increased marketing efforts throughout South Texas, as well as Mexico, and the young population. But there is also a realization that this positive streak probably won’t last forever, Rodriguez acknowledged.

The Dallas Fed outlined some challenges for the region in its report.

“Skill shortages remain an issue,” the report read. “It is hard to attract skilled workers to the region — and young, educated people tend to leave to find higher-paying jobs elsewhere.”

Other issues in the report included trade policy uncertainty and tariffs on U.S.-Mexico trade and “a population that is relatively poorer and less-educated than the Texas average may limit the area’s ability to attract high-paying industries.”