New Mexico’s economy is at a critical juncture.
As the state enters a new century of statehood, we can choose two paths:
One path is based on the status quo, which includes an over-reliance on federal discretionary funds, a system that imposes a complex and onerous tax system on job creators and discourages private investment.
Alternatively, we can choose a course that will invest in small businesses and entrepreneurs, workers, critical infrastructure and rural communities. We call this path the “New Century Jobs Agenda,” and we will be bipartisan advocates of this plan for sustainable economic growth.
There is a looming jobs crisis that unites all New Mexicans. The University of New Mexico and the Federal Reserve Bank estimate that federal budget cuts will cost the state 20,000 jobs over the next year.
New Mexico’s employment statistics over the last three months indicate that the first wave of this federal jobs-loss tsunami has already occurred. Obviously, the federal presence in our state is crucial to our nation’s defense and research infrastructure. Certainly, New Mexico’s congressional delegation must fight to protect these critical assets in what is always a policy blood sport in the annual appropriations process in Washington.
While there are dark clouds gathering on the state’s economic horizon, there is good news: In less than two years, the state’s $500 million deficit has been converted into a projected $270 million surplus without raising taxes on job creators and workers.
In that same period, New Mexico’s unemployment rate dropped from over 8 percent to 6.4 percent, well below the national average. Manufacturing in the state has reversed the national trend with an uptick in growth. The tourism, mining, transportation and logistics sectors have also experienced strong gains in employment.
New Mexico’s export numbers have doubled and the state moved from 38th to second in the nation in export trade growth. Companies like Union Pacific, Lowe’s, Bendix/King, Air USA recently located here, and others have expanded operations.
The Santa Teresa Borderplex is experiencing a boom and Southeast New Mexico is at full employment, thanks to increased oil production.
Finally, Moody’s Analytics ranks New Mexico sixth in the country for potential private-sector job growth over the next five years.
Such optimism, however, must be tempered by the economic realties imposed by Washington’s fiscal crisis. Furthermore, in order to avoid an economic calamity in New Mexico, we propose a common-ground, balanced strategy. It includes:
♦ Enacting an elective single sales factor that allows companies to be more competitive in New Mexico.
♦ Reducing the corporate income tax from 7.6 percent to 4.9 percent.
♦ Investing $10 million in the Local Economic Development Act, which provides funding for infrastructure projects tied to direct job creation.
♦ Investing $4.75 million in the Job Training Incentive Program that offers job creators financial support to hire and train new employees.
♦ Reforming the capital outlay process to prioritize and complete major public works projects.
♦ Passing the Spaceport Informed Consent law for a successful commercial space industry.
♦ Investing in the MainStreet program, which spurs business development in rural communities.
This agenda evolved from the New Century Economy Summit. The summit was convened by the New Mexico Economic Development Department and facilitated by New Mexico First, the state’s leading nonprofit policy group. The summit involved business, community and economic development leaders from every region of the state. It included representatives from various industries, labor leaders, community activists, higher education professionals.
New Mexicans are resilient, hardworking and entrepreneurial people with an independent spirit. The New Century Jobs Agenda complements those qualities.
Our path is clear: Let’s confront upcoming economic challenges in an aggressive fashion. Let’s do it in a unified manner.
In the end, it’s not about who takes credit for the benefits of enacting the New Century Jobs Agenda, it’s about leadership. We intend to offer that leadership.