Analysis: NM at risk of "economic death spiral" - Albuquerque Journal

Analysis: NM at risk of “economic death spiral”

New Mexico is on the precipice of an “economic death spiral” as long as it continues conducting “business as usual,” according to an analysis presented at a Jobs Council meeting on Monday.

Mark Lautman, the council’s lead program consultant, authored the analysis, which was based on economic data from the state, local, and federal levels. He told the bipartisan group of lawmakers and special-interest groups that if New Mexico conducts “business as usual,” the consequences for the state could be dire.

“Not only will we be unable to reach full employment for our current population, but we won’t have jobs for the additional population we’re projected to have (over the decade),” said Lautman. “There’s going to be even more attrition if that happens, and that could be a big problem.”

Lautman said the 147,177 economic base jobs over a decade are what would be required to bring employment to pre-recession levels. An economic base job is a position that brings in most of its money from outside the state, thereby introducing new wealth into the economy instead of circulating existing money. The 147,177 is a revised estimate from the 140,000 included in the council’s December 2015 report.

He said the situation has been made even more pressing by New Mexico’s recent budget problems, which have endangered the council’s current recommendations and complicated any future ones. The state is facing a $458 million projected budget shortfall for the current fiscal year, along with a $131 million deficit for the budget year that ended June 30.

The strategies the council discussed at the meeting for creating the jobs included:

— Marketing New Mexico as a retirement destination.

— Funding “solo work programs” that would support individual consultants and remote workers.

— Bringing broadband internet to rural communities through public-private partnerships.

— Continuing to fund the state’s Job Training Incentive Program (JTIP) and Local Economic Development Act (LEDA) programs.

The council also discussed proposing legislation that would add increased accountability to economic development efforts, in part by creating a new state office devoted to collecting and analyzing data on job creation programs.

While most participants appeared to support many of the strategies discussed at the meeting, partisan lines appeared when the subject of right-to-work legislation came up. Supporters said it would be a way to increase economic development without requiring additional government investment. Those opposed said there was no data supporting the economic impact of such a measure.

“This is supposed to be a bipartisan group,” said Lautman when the discussion became heated. “You need all the stakeholders involved. That’s the only way it’s going to work.”

The council will form its legislative recommendations in the coming weeks.

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