New Mexico is in an economic rut.
It is not due to a shortage of jobs. More than 31,000 jobs were available for non-farm employment, according to the most recent report from the state’s Department of Workforce Solutions.
The problem is our low worker participation rate, at just 56.8%, the third-lowest in the nation behind West Virginia and Mississippi, according to the most recent unadjusted data from the Federal Reserve Bank of St. Louis. .
Too few workers despite plentiful jobs drives up the costs of everything.
“He can’t bring anybody to work,” State Rep. Luis Terrazas, R-Santa Clara, said of his 77-year-old father, Luis Terrazas, who has been building homes in Silver City for decades.
Elder Terrazas plans to retire after 45 years because he cannot find workers after completing his latest construction project on his own.
It’s a story we see across the state.
Staffing issues have limited restaurant opening days. Hotels cannot have housekeepers. Schools cannot hire enough teachers and bus drivers. Higher-paying jobs in engineering, healthcare, computer systems and higher education are also unfilled.
Workforce Solutions says this is partly related to the high number of people with disabilities in New Mexico. The number of disabled workers benefiting from survivors’ old-age and invalidity insurance has doubled since 1999, while the number of disabled workers receiving supplementary security income has increased by more than 45%.
New Mexico’s unemployment rate remains higher than neighboring states. If we had the same labor force participation as the rest of the country, we would have nearly 100,000 more workers.
DWS Deputy Secretary Yolanda Cordova said another factor was drug addiction, a cancer that affects too many New Mexican families, our economy and our communities.
We also have an aging population and too much out-of-state migration of working-age adults.
So what do we do?
College, Vocational/Technical Education
State lawmakers recently allocated more than $100 million to higher education institutions for teaching endowments for nurses and social workers, $10 million for re-employment services and youth learning, and expanded the Opportunity Scholarship and Fully Funded Lottery Scholarship so that a college certificate is essentially free and a degree is affordable for new Mexicans.
Encouraging vocational training for those who are not interested in a four-year degree is the right way. Hobbs has just opened a $50 million vocational and technical training center with the help of local and private investment. “Dirty Jobs” host Mike Rowe was the special guest at the May grand opening.
Superintendent of Schools Hobbs says about half of high school graduates go on to technical careers. Getting teenagers to become artisans, from welders and electricians to carpenters, masons and plumbers, could be an important step out of our economic quagmire. Skilled trades jobs pay well and are always in demand.
A cliff of benefits that should be a slope
Government social programs that penalize increasing your income by taking more hours, a promotion, or a better job are also part of our low labor force participation rate. Last June, nearly half of all New Mexicans were enrolled in at least one state Department of Social Services income support or health program.
When better job prospects don’t make up for what a household stands to lose in food or childcare support, it’s obvious to avoid falling off that cliff and stick to the benefits that run your household.
But government programs should be a bridge to something better, not a generational lifestyle. They are not designed to lift people out of poverty or make dreams possible. They also do not contribute to the 401K or other retirement programs. We have a looming retirement crisis, with most New Mexican workers age 50 or older having no retirement savings.
“We need to figure out how we can (climb) those cliffs so they don’t get discouraged,” says Rob Black, CEO and president of the New Mexico Chamber of Commerce.
The state should try to soften this sharp cut in benefits in a gradual, sloping approach, perhaps by temporarily supplementing the loss of benefits for those who want to scrape by and move up the income ladder.
Data on why so many people don’t work
Workforce Solutions plans to form focus groups to interview people who are not working and not receiving unemployment benefits – and asking them why they are no longer working. The results could be enlightening and should be made public. Rather than throwing even more money at the problem, let’s find out if our reliance on government benefits, lack of affordable child care, or persistent substance abuse issues are keeping people from working. Or are too many of us simply too old and too disabled to join the workforce, which makes retaining our young residents all the more essential?
The state has already expanded child care subsidies to help New Mexicans get back to work. We also raised the minimum wage, required private companies to offer paid sick leave, and added a return-to-work program for retirees. State and business leaders are working towards more, including providing funds to employers to pay higher wages.
Yet more than 480,000 New Mexicans age 16 and older are unemployed. And last year we had the fourth lowest participation of women in the labor market. We can and must do better, but we must know how best to put our shoulder to the wheel.
This editorial first appeared in the Albuquerque Journal. It was written by members of the editorial board and is unsigned because it represents the opinion of the newspaper rather than that of the editors.