New Mexico's unemployment rate higher than national average, lower in oil and gas counties
San Juan County sees slight drop, averages 6.1%; Eddy County lowest at 3.2%
More New Mexicans are out of work than the national average.
Nationwide, the unemployment rate was reported at 3.8 percent as of February, compared with New Mexico’s rate of 5.1 percent.
That number remained steady since Feb. 2018 and showed no change from the month before.
Meanwhile, the national average dropped from 4 percent in January and 4.1 percent in February 2018.
Bill McCamley, cabinet secretary of the New Mexico Department of Workforce Solutions, said the state’s position above the national unemployment rate is concerning but untied to a particular trend or issue.
“Because New Mexico is so big, I wouldn’t say there’s one thing driving employment aside from the national economy,” he said. “As national employment goes up, so does ours. We’re still behind many other states.”
To bridge that gap, McCamley said the State is working on increasing workforce training to provide jobs people want and trained workers industry needs.
He said oil and gas regions such as Eddy and Lea counties in southeast New Mexico or San Juan County to the northwest have unique needs such as more commercial drivers license or welding programs for oilfield workers.
Doña Ana County in the southwest relies heavily on the border for much of its economy, McCamley said, and training mechanics would fill many open positions.
But across the state, he said the biggest sector that could drive employment is healthcare.
“There is a need for everything all the way up to doctors,” McCamley said. “This is a statewide issue. Our goal is to go into all regions and look at their needs.”
Filling those needs requires collaboration with private industry, he said, to ensure educational programs train workers to fill specific company needs.
“Our job is to be proactive and ask employers what they need,” McCamley said. “We want to work with the businesses and employees so that workers can get the skills they need.”
How New Mexico compares to neighbors
New Mexico has some ground to make up, McCamley said, as it is showing a higher unemployment rate than neighboring states.
Texas reported an unemployment rate of 3.8 percent as of February, per data from the federal Bureau of Labor Statistics.
Colorado was at 3.7 percent, and Oklahoma reported an unemployment rate of 3.3 percent, records show.
Arizona was tied with New Mexico with a rate of 5.1 percent.
“We’re behind our neighbors,” McCamley said. “We consistently have lower wages and higher unemployment.”
Diversifying New Mexico’s economy could be the path toward better numbers, he said, as newly-elected Gov. Michelle Lujan Grisham worked to such ends by supporting the creation of an outdoor recreation department in the State and working to encourage movie producers to eye New Mexico for their next blockbuster.
“Gov. Grisham believes in an economy that works for everybody,” McCamley said. “She’s very committed to making sure everyone can make a wage where they can support themselves and their families.
“We need to make sure we’re doing that in every community, because every community is different.”
Unemployment lowest in the southeast
Eddy and Lea counties, where the oil and gas industry began booming in 2017, had the lowest unemployment rates in the state at 3.2 and 3.8 percent, respectively.
Of 32,620 people in Eddy County’s workforce as of February, per data from the New Mexico Department of Workforce Solutions, only 1,057 people were unemployed.
Lea County reported 1,187 unemployed residents, out of workforce pool of 31,015.
Along with Los Alamos County, where most residents work at Los Alamos National Laboratory, those counties were the only ones in New Mexico below the national unemployment rate of 3.8 percent.
San Juan, a county known for oil and gas in the past but where the industry has begun to leave and shift to renewable energy, notched an average of 6.1 percent unemployment, with 3,257 people unemployed.
Doña Ana County, where employment is fueled by border security operations and agriculture and the major metropolitan area of Las Cruces, was at 6.3 percent or 6,208 people who were unemployed.
Luna County had the highest unemployment rate in New Mexico at 17.6 percent, more than four times the national average.
Luna County and the city of Deming relies heavily on seasonal agriculture for its economy — mostly green chile and onion. Its unemployment typically drops by about 10 percent during harvest and growing seasons between June and October.
When seasonal field workers aren’t needed during the winter and spring, the rate fluctuates back up.
The biggest population centers in Albuquerque and Santa both showed reductions in unemployment, with respective rates of 4.8 and 4.3 percent.
Oil, gas boom brings challenges
Shannon Carr, local development coordinator with the Carlsbad Department of Development in Eddy County, said her area’s low unemployment rate is driven by the incoming oil and gas companies during the boom.
“We’re getting a lot of new positions from major industry, definitely oil and gas related,” she said. “It’s the same issue we’ve been having for about three years.”
But a low rate can also cause challenges, as the new businesses and industries could struggle to come into the area due to a lack of available workers.
“It’s definitely difficult to find office staff for these companies, not to mention field staff too,” Carr said. “Bringing in more industries becomes slightly more difficult. We have a lot of resources, but it’s hard to find who they’ll hire and where they’ll live.”
Still, Carr said it’s a good problem to have, for now.
She said a low unemployment rate is a sign of a good economy, but if it drops below 3 percent business could begin setting up shop elsewhere.
“I hope it doesn’t drop below 3 percent,” Carr said. “That would make it extremely challenging. The future is still bright. It’s a growth obstacle.”
At San Juan College in Farmington, Dean of Workforce and Economic Development Lorenzo Reyes said many in the community want to work but can’t find a job.
Even worse, he said many are “underemployed” meaning they work part time or for minimum wage, despite a desire to work for more hours and higher pay.
That’s because extraction industries such as oil and gas and mining have reduced operations in recent years, he said, taking the high salaries with them.
“There are people who would have higher jobs if the market was better,” Reyes said. “Most of the jobs that pay well are related to energy and we’re seeing a reduction in those industries.
“People no longer working for oil and gas still need to work, but they aren’t being compensated for what they lost."
Diversify to survive
San Juan County saw a slight decrease in unemployment, dropping from 6.5 percent in January to 6.1 percent in February.
Reyes said it’s a good sign, but there is still work to be done.
That took the form of more employee training programs at the college, he said, in a growing list of industries.
A shift to renewable energy in the Four Corners region was a major part of the Energy Transition Act, which Lujan Grisham recently signed into law — providing funding for retraining and severance for employees displaced by the closure of fossil fuel facilities.
The college is also emphasizing emerging industries in the area, Reyes said, to establish a presence in the heath sciences and information technology sectors.
“We’re very cautious about the optimism,” Reyes said. “There is an emphasis on moving toward renewable energy. We need to diversify. To do that, you need to train your workforce.”
For Doña Ana County and Las Cruces, McCamley — who formerly served as a State Representative of the area — said diversification is key to economic survival.
He pointed to the border, agriculture and the emerging aerospace and outdoor tourism industries as new areas where the region is seeing growth.
“Dona Ana has done a very good job diversifying its economy,” McCamley said. “There are a lot of job opportunities open, but they require skills. We need to work in the state to line up people who want skills they need and let the employers know they’re here.”