Home BusinessEconomic News What’s holding New Mexico back from economic growth?

What’s holding New Mexico back from economic growth?

by Stella Morgan

New Mexico Faces Challenges in Workforce Participation, Report Finds

New Mexico’s labor force is hindering economic development and expansion in the state, according to a recent report by the Legislative Finance Committee (LFC). The report highlights a significant gap between the demand for workers and the supply, indicating that New Mexico needs about 116,000 more workers to reach the national average rate of workforce participation.

The issue of workforce participation is complex and difficult to address. Since 2010, nearly 20,000 workers have left New Mexico and have not been replaced, creating a shortage of skilled workers in the state. Additionally, there is a mismatch between the skills workers possess and the skills required by available jobs, leading to workers “exporting” themselves to other states with better job opportunities that align with their skills.

Jon Clark, the acting secretary for the Economic Development Department, emphasized the need for better alignment between education and job market needs. He highlighted the misalignment between students’ skills, degrees, and certifications and the job market’s requirements. Improving this alignment is crucial to attracting and retaining skilled workers in the state.

New Mexico has implemented programs to address the issue, such as the Job Training Incentive Program (JTIP), which provides funding for education and training for newly created jobs. However, the report indicates that the cost-per-job-created for the state has increased by 85% in the last fiscal year. Similarly, the state’s Local Economic Development Act (LEDA) program has experienced a rise in per-job costs.

The report’s findings underscore the importance of addressing the challenges in New Mexico’s labor force for sustainable economic growth. Policymakers and stakeholders must work towards developing effective strategies to attract and retain skilled workers, align education with job market needs, and enhance programs that facilitate workforce participation.

As New Mexico experiences record levels of revenue available for investment, it is crucial to prioritize addressing these labor force challenges and investing in strategies that will drive growth and prosperity for the state. By addressing the gaps in workforce participation and creating an environment conducive to attracting and retaining skilled workers, New Mexico can unlock its full economic potential.

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