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NM should focus on elevating our human capital

logoI was complaining to a friend recently about the deal that brought Facebook’s new data center to Los Lunas.

It’s bad enough, I said, that we’re paying $10 million in Local Economic Development Act funds for what is estimated to be at most 50 jobs. That comes to $200,000 per job – more if Facebook taps the $3 million in job training funds the state is prepared to offer. But the kind of jobs we’ll be getting aren’t the jobs we need if we’re going to develop the workforce required to transform our mid 20th-century economy.

At this point, I strayed into hyperbole. Basically, our people will be making sure the data center’s power stays on and the guard dogs are fed, I said.

It’s like Spaceport America, I ranted. We built a lot of expensive infrastructure near Truth or Consequences so that Richard Branson’s Virgin Galactic, by making billionaires pay to be guinea pigs on his spacecraft launched from New Mexico, can figure out how in the not-too-distant future it can fly ordinary travelers from New York to Tokyo in two hours. In return, I said, we get to clean and refuel the spacecraft. The spacecraft itself is being designed, built and tested elsewhere. Requiring that the craft be designed and built here so that New Mexicans could get the expertise that might have allowed us to become something more than baggage-handlers to the commercial space industry was not part of the Virgin Galactic deal.

Calming down a little, I acknowledged that Facebook will offer jobs somewhat more sophisticated than answering a call center’s phones, but the 21st-century jobs will remain at headquarters in California. Facebook’s crown jewels are the data it collects from its users. The keys to unlocking those data are the data-mining and computer security experts Facebook employs, people who are in possession of tremendously valuable skills, none of whom is required in a data center in Los Lunas.

Catching a second wind, I raged that it’s kind of like Intel. The semiconductor manufacturer came to New Mexico, hired a bunch of people, got some interesting education programs going at the University of New Mexico and CNM, but hired the really important expertise – chip design and materials science – in other states. Our people learned about manufacturing, but manufacturing jobs are designed to disappear. It’s like that old joke, I said. The manufacturer’s ideal workforce consists of one man and one dog. The man’s job is to make sure the machines keep running and the dog’s job is to make sure the man doesn’t touch anything. That relentless and perfectly reasonable push to eliminate labor in manufacturing through automation is why Intel employs about 20 percent of the workforce it had at its peak in New Mexico.

My friend waited for me to run out of steam, then asked: What else could we have done with the money?

Granted, he said, our state’s economic problem comes down to the lack of human capital. We have no plan to address that problem and, without a plan, we have no place to spend the money on developing human capital. Meanwhile, Facebook is prepared to hire a lot of construction labor, as many as 50 staff members, and lend the prestige of its name to our state. That prestige becomes a recruiting tool for other companies that might not have looked at New Mexico. That’s not nothing, he said.

I had to agree. We’ve argued about public education for the past six years and are no closer to a world-class school system. We’ve cut our universities’ budgets and raised tuition. Worse, with the exception of some charter schools, government hasn’t tried anything innovative to identify the kind of workforce we need if we are to compete globally, then find ways in partnership with the private sector to build that workforce. Since we can’t offer 21st-century human capital to companies looking to expand, we offer money.

Until the state does come up with a plan to build a first-class workforce, a better use of $10 million might be investment capital for our home-grown companies.

My colleague Kevin Robinson-Avila has reported that both startup and older companies are struggling to find the capital they need. Lisa Kuuttila of STC.COM, which helps turn ideas originating at UNM into commercial ventures, estimates we need $300 million to $400 million more to finance more mature New Mexico companies that are ready to expand.

Since the money isn’t there, she said, more and more maturing startups are leaving the state in search of financing. I am sure they have taken more than 50 jobs with them.

Comment directly to Winthrop Quigley at 823-3896 or wquigley@abqjournal.com.

 

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