Copyright © 2020 Albuquerque Journal
The Great Recession left New Mexico with a decade of poor economic results.
To avoid a repeat once the COVID-19 pandemic abates, a new report from the New Mexico Chamber of Commerce offers a road map for how the state can evolve in the coming decades.
“We want to make sure that, when we come out of COVID, we are not going to lose another decade like we did during the Great Recession,” said Rob Black, president and CEO of the organization, formerly known as the New Mexico Association of Commerce and Industry. It advocates for business-friendly public policy.
The report, titled “Driving New Mexico’s Future,” identifies challenges regarding the state’s economic competitiveness, and offers 17 specific strategies in areas ranging from worker attraction to regulatory reform.
“Because of COVID, we think it’s very important that New Mexico comes out of the pandemic prepared, stronger and better than ever,” said Sayuri Yamada, chair of the New Mexico Chamber’s economic strategy working group.
The report notes that New Mexico’s economic recovery from the Great Recession was particularly slow compared with that of its neighbors.
In 2019, New Mexico ranked well below the national average in both gross domestic product per capita and in GDP per capita growth over the previous 10 years. New Mexico ranked 44th in job growth over that period, as Arizona, Colorado and Texas each posted above-average job growth rates.
“In 2021, we all begin the race to recovery, but in New Mexico we have much more ground to make up,” the report says.
Black said that work on the report began before the pandemic reached New Mexico in March and that the impact of the pandemic prompted the working group to fast-track its efforts. In August and September, the group surveyed about 700 business owners and other New Mexicans to gauge their feelings on the state’s competitiveness.
Based partly on that feedback, the report identified two key challenges – improving the state’s business climate and growing its working-age population – that the state must address to improve its status.
Black said the local business climate, which includes such factors as tax structure and regulation, is often cited as an impediment to growth.
Black said that although the state ranks roughly in middle of the pack for its overall tax burden, the structure of several taxes – including the state’s gross receipts tax – places an undue burden on small businesses.
The report recommends creating a Governor’s Office of Regulatory Reform, which would identify areas to improve efficiency and reduce unnecessary restrictions and conduct a review of tax policies that stand out as being anti-competitive.
“We’re not asking to have no regulation. We understand the importance of regulation. … What we’re just saying is, we’d like it to be more efficient,” Yamada said.
Along the same lines, Black said bringing new working-age people to the state and developing talent in existing residents are key challenges.
The report notes that current projections show a statewide loss of working-age New Mexicans over the next decade, as the state’s over-50 population is projected to double.
Because of that, Black said, it’s vital to continue job-training efforts and find creative ways to attract new residents. Black pointed to Vermont’s remote-worker program, which offers grant funding to people moving to the state to work remotely, as a potential model the state could follow.
The report will be formally presented at an all-day economic conference hosted in January, with working groups examining how to implement some of the suggestions.
“The whole thing is a call to action,” Black said. “… But it’s not going to happen overnight.”