Tuesday, March 15, 2016
On The Econ Beat: Oil Crash Has Jobs Recession Rear Its Ugly Head Again; College Kids Hit The Exits, Plus: Power Play At UNM Goes Down, And: Watch Your Back, Ryan
Mississippi and Alaska saved us from having the nation's highest unemployment in January for the third month in a row but we still shed jobs:
New Mexico’s seasonally adjusted unemployment was 6.5 percent in January down from 6.6 percent in December. . . The national unemployment rate was 4.9 percent, down from 5.0 percent in December. . . Total nonfarm payroll employment contracted by 1,800 jobs, or 0.2 percent, between January 2016 and January 2015. January was the second month in which total nonfarm employment losses were reported since October 2012.
The state also reports a smaller workforce than a year ago. The ongoing flight of the state's best and brightest to neighboring states does not bode well. The Legislative Council Service (LCS) reports:
According to the Bureau of Business and Economic Research (BBER) at the University of New Mexico, "over 40% of the residents moving out of state had four-year degrees," indicative of a scarcity of good-paying job opportunities and uncompetitive salaries. In sharp contrast, neighboring states Colorado, Texas, Utah and Arizona were in the top 10 states reporting population increases.
Maybe the LSC is reading our mail because its analysis of what's happening around here could have been lifted from one of our many blogs. Here's their lowdown:
Businesses considering where to lay down roots may look at New Mexico and see a confusing tax system, which is being studied again, relatively high crime rates, low- performing schools and a workforce that does not meet their needs. Bright spots in the job picture do exist, most notably due to federal expenditures that have long been New Mexico's strength. But it is increasingly clear that without substantial diversification of the state's economy and increased opportunities for the college-educated workforce, New Mexico will continue to struggle.
It has taken years but Santa Fe is finally recognizing the downward spiral the state is caught up in. The problem remains the political will to offer a big picture solution. It's late in the game and prospects for a short-term reversal appear dim. There is no sense of urgency in the body politic or business community over the state's new stagnant direction. In fact, we appear to be getting comfortable with it, perhaps reflecting an increasingly older and retired population.
The lack of an investment theme means a continuation of the trends that are now so familiar--a downsizing in the state's higher education complex; continued depopulation, especially in rural New Mexico; an increase in crime resulting from a growing, disenfranchised population, steep growth in food stamp and Medicaid recipients and stagnant wage growth as low-paying jobs dominate.
UNM POWER GRAB (CONT)
$656,000 a year for overseeing the sprawling UNM Health Sciences complex that includes a hospital and cancer center. But maybe it's time for a pay cut for Roth after the Monday power grab executed by the UNM Regents. They demoted Roth when they restructured the governance of Health Sciences and created a three member subcommittee of UNM Regents--who are appointed by the Governor--to oversee policy. UNM President Bob Frank now says Roth will be "Chief Executive Officer" instead of Chancellor.
The rushed change drew howls of protest at a public meeting Monday, but the fix was in. This Governor, like the one before her, put her stamp on the place with behind the curtains help from de facto UNM President David Harris. Here's how one former high level UNM administrator describes the situation:
We worked hard to try to close the political chasm between the main UNM campus and the north (Health Sciences) campus. We believed we were one institution--a university-- and differences between the two areas could and should be minimized. These are not separate institutions. Making Paul Roth a "Chancellor" was a big mistake. The President of UNM should be the CEO and COO of all parts of the university; the institution should have one head.
As you realize, the UNM president's authority has been whittled away since the Richardson administration took office. The Regents began micromanaging as never before. Richardson's buddy, David Harris, lacking even the minimum prescribed qualifications, became not only the Financial VP but also the Chief Operating Officer (COO)! Where did this leave the President? As some kind of symbolic ribbon-cutter, fund raiser and speech maker? Yes, former UNM President David Schmidly, and now President Frank, have pretty much just "gone along for the ride" with great compensation/retirement packages as the prime reason to stay in office and keep their mouths shut.
Cangiolosi, according to a wide range of informed and reliable sources, ratted out top Martinez political adviser Jay McCleskey during the FBI investigation of Jay that went before a Federal grand jury that recently disbanded without returning any indictments. Now that the Fourth and Fifth Floors have even more entrée into Health Sciences via the restructuring, what happens to Cangiolosi? Well, all we can say is watch your back, Ryan. That hot breath you feel on your collar is Jay's.
And that's the way the game is really played, kids. You won't read it anywhere else--nowhere--and that's why New Mexico Politics with Joe Monahan is the state's #1 source for how this place is really run.
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(c)NM POLITICS WITH JOE MONAHAN 2016