In May, the national unemployment rate was 3.6% down from 3.8% in May 2018. On June 21, 2019 the New Mexico Department of Workforce Solutions reported that New Mexico’s adjusted unemployment rate was 5.0 percent in May, unchanged from the previous month and up from 4.8 percent in the same month the previous year. Notwithstanding the small increase in the unemployment rate, the state of New Mexico outpaced the national job growth rate.
NM Department of Workforce Solutions Secretary Bill Mc Camley says the numbers are good for the Land of Enchantment by saying:
“Too often New Mexico is ranked 49th or 50th in the good things our country measures, but this growth, particularly in the private sector, shows New Mexico is headed in the right direction and open for business. … If you work hard and learn the right skills, you don’t have to give up your chile and move away for a job … You can earn a great salary here while staying in our friendly, beautiful communities.”
NEW MEXICO UNEMPLOYMENT RATES CONTINUE TO IMPROVE
On June 21, 2019 the Department of Workforce Solutions reported the total non-agricultural payroll employment in New Mexico increased by 15,900 jobs, or 1.9% between May 2018 and May 2019 with most gains from the private sector, which was up 2.3% or 15,300 jobs. Mining and construction, which includes the oil and gas industries, had the largest gains, adding 5,500 jobs, or 7.6%.
Other gains reported by the Department of Workforce Solutions in the private sector include:
Professional and Business Services Industry employment is up 3.5% or 3,700 jobs.
Education and Health Services Industry increased by 2.6% or 3,600 jobs.
The Leisure and Hospitality Industry added 3,500 jobs, or 3.5%.
Financial activities showed a gain of 600 jobs, or 1.8 percent.
Manufacturing Industry employment was up by 1.4% or 400 jobs.
Private sectors industry losing jobs included:
Trade, transportation, and utilities was down by 1.5% or 2,100 jobs
Employment in information sector was down 2.5% or 300 jobs.
In the local public or government sector, local government employment grew by a mere 0.8% or 800 jobs. All gains came from local government excluding education, with education up by 1.6%.
Federal government reported a gain of 500 jobs, or 1.7% while state government employment decreased by 700 jobs, or 1.3%.
ECONOMIC BASE JOBS VERSUS SERVICE INDUSTRY JOBS
A service-based industry is one that offers its products, goods or services primarily within a particular region and does not supply markets outside the region nor increase the economic base of a region. In general, service base industries offer lower paying or minimum wage jobs not requiring much education or technical skills.
Economic base industries provide jobs requiring higher education and higher trained skills An economic base job is one created or needed by a business or industry that increases economic growth of a region by increasing exports of manufactured products, goods or services from the local economy or region to another region or economy thereby increasing the size of the local economy with profits and cash flow from outside the region.
The corner stone of the “economic base theory” is that an increase in economic growth of a region or economy is dependent on increase in exports, manufactured goods or services from one region or economy to another region or economy and supplying markets outside the local economy.
COMMENTARY AND ANALYSIS
Without question the positive news coming out of the NM Department of Workforce Solutions when it comes to our reduction in its unemployment rates is news that has been a long time in coming.
Notwithstanding, New Mexico needs to pursue with a vengeance the real growth industry like heath care, transportation and manufacturing, and the film industry to diversify our economy. Public-private partnerships in the growth industries where ever possible should be encouraged and developed. Special emphasis and support should be given to Albuquerque’s and New Mexico’s film industry which is developing, expanding and proving to be very successful in providing well-paying jobs.
With NBC Universal coming to Albuquerque and the purchase of Albuquerque Studios by Netflix, the film industry is clearly in the future of New Mexico and the best hope at this point in diversifying our economy. Last year alone, the film and TV production industry brought in over $180 million of direct spending to the city and state. Far more important, jobs that will be provided by both NBC Universal and NETFLEX are a far cry from the hourly wage jobs provided by the “call centers” that the state has become accustomed to being announced.
The State needs to continue with efforts that will ensure that our education institutions such as the New Mexico Community College continue to offer a trained work force. Both the City and the State need to create more incentives to build and guarantee that the industry continues to prosper in New Mexico.
There is never any guarantee what government does to spur economic development, such as offering tax incentives or reducing corporate taxes, that will create “economic based jobs.” For that reason, New Mexico Governor Michelle Lujan Grisham and the New Mexico Legislature must take bold and aggressive, calculated risks to attract and create high-paying jobs to keep our youth and talent from leaving. The State’s economic development efforts need to be coordinated with our vocational institutions to identify new industries that can be attracted to Albuquerque and ensure that both have the trained workforce to accommodate any new industry.
Until then, New Mexico appears to be finally pulling out of the great recession.