Staff Report
Numerous job layoffs, firm closings, a statewide drought and the Sept. 11 terrorist attacks are among the causes of a worsening New Mexico economy, according to UNM's Bureau of Business and Economic Research.
The unemployment rate during the second quarter jumped to 6.1 percent from five percent in the first quarter. Employment growth has been shrinking since the first quarter of 2001, when it reached 2.4 percent. Personal income growth throughout the state has remained consistent posting a 5.5 percent gain during the fist quarter of this year, and non-agricultural employment has fallen to 0.6 percent, dropping 0.3 percent during the first quarter.
Mining, manufacturing and construction - the state's three primary industries - are also suffering.
Construction work, stimulated at the end of last year by the renovation of the Big-I interstate project, a major expansion of Intel and a strong housing market, has dropped 5.5 percent since the beginning of the year.
The mining industry has suffered similar results - down 8.2 percent from last year, with a loss of more than 1,300 jobs statewide.
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Manufacturing employment is down 3.2 percent, a reflection of numerous layoffs and plant closings during the last year, with further losses expected, according to the bureau.
The government sector, the largest area of employment, has enjoyed a 3.6 percent growth, with all levels of government experiencing the increase. Federal government was up 3.7 percent; the largest government increases, and the state government was not far behind, with employment up 2.0 percent, most noticeably in the expansion at Los Alamos National Laboratories.
Local employment has increased 4.6 percent this year, with an infusion of more than 4,333 jobs into the local economy. More than half of those are in the field of education, while the rest are in American Indian enterprises, casinos and resorts.
Although statewide conditions are far from promising, conditions are expected to dwindle further for the next four quarters, with a resurgence expected in the second half of 2003.
Non-agricultural employment growth will average only 0.4 percent until that time, peaking in the neighborhood of 1.5 percent.
Personal income growth will continue to be subdued, with expected gains of 4.6 percent this year, 4.3 percent next year and 5.1 percent in 2004. The bureau predicts unemployment rate will jump to 6.1 percent in 2002 and 6.2 percent in 2003 before easing to 5.6 percent in 2004.
The shrinking employment possibilities in mining, manufacturing and construction will place a substantial restraint on economic growth for the next several years, according to the bureau.
By 2004, all sectors are expected to have more-or-less recovered, with no sector enjoying less than a one percent gain.
