New Mexico Economy, 2016, with notes on the situation of women

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University of New Mexico Bureau of Business and Economic Research New Mexico Economy, 2016, with notes on the situation of women NM Women s Agenda January 15, 2016 Dr. Lee A.

1 University of New Mexico Bureau of Business and Economic Research New Mexico Economy, 2016, with notes on the situation of women NM Women s Agenda January 15, 2016 Dr. Lee A. Reynis, Research Professor Department of Economics lreynis@unm.edu UNIVERSITY OF NEW MEXICO BUREAU OF BUSINESS AND ECONOMIC RESEARCH 303 Girard Blvd. NE MSC / Onate Hall Albuquerque, New Mexico 87131

2 US Real GDP Growth Composition of Real GDP Growth Over Previous Period SAAR Composition of Real GDP Contrib Q2 14Q3 14Q4 15Q1 15Q2 15Q3 15Q3 Gross Domestic Product Total Consumption Durable goods Nondurable goods Services Residential Fixed Investment Nonresidential Fixed Investment Structures Equipment & Software Intellectual Property Change in Private Inventories Exports Imports Federal Government State & Local Government US Bureau of Economic Analysis, Gross Domestic Product, 2015 Third Quarter (advance), October 29, 2015

3 US Employment Situation 145,000 Total US Non-Farm Employment (000 s) 140, , , , ,000 US Bureau of Labor Statistics, Current Employment Survey

4 US Employment Situation 10.0 US Unemployment Rate (%) US BLS data

5 US Employment Situation: Women vs. Men

6 US Employment Situation: Women vs. Men 85,000 80,000 Number Employed, Thousands Women Men 75,000 70,000 65,000 60,000 48% Women as a Percent of Total Employed 48% 47% 47% 46% 46% US BLS data

7 US Employment Situation: Women vs. Men 12.0 US Unemployment Rates (%) Compared Women men US BLS data

8 US Employment Situation: Women vs. Men 75 Employment-Population Ratios (%) Women Men 45 US BLS data

9 Characteristics of Business Owners Source: U.S. Census Bureau, 2007 Survey of Business Owners Summary Statistics for Owners of Respondent Firms by Gender, Ethnicity, Race, and Veteran Status: 2007 (still waiting for 2012) Meaning of Gender, ethnicity, race, and veteran status code Owners of respondent firms Owners of respondent employer firms Owners of respondent nonemployer firms Total owners of respondent firms All owners of respondent firms 20,423,420 6,089,427 14,333,993 Percent of owners of respondent firms Female 37.5% 30.6% 40.4% Male 62.5% 69.4% 59.6% Hispanic 5.9% 4.7% 6.5% Non-Hispanic 94.1% 95.3% 93.5% White 90.6% 91.3% 90.4% Black or African American 3.6% 1.7% 4.5% American Indian and Alaska Native 0.8% 0.5% 0.9% Asian 5.6% 7.0% 5.0% Native Hawaiian and Other Pacific Islander 0.2% 0.1% 0.2% Some other race 0.3% 0.3% 0.4% Minority 15.4% 13.6% 16.2% Nonminority 84.6% 86.4% 83.8% Veteran 12.2% 11.8% 12.4% Nonveteran 87.8% 88.2% 87.6%

10 New Mexico Economy

11 NM and US Employment Indexed to Cycle Peak Nonfarm Employment, Monthly SA New Mexico US US BLS data

12 New Mexico Total Employment Growth Percent Growth in Oct and Nov was less than 0.4% Jan 2007 Jul 2007 Jan 2008 Jul 2008 Jan 2009 Jul 2009 Jan 2010 Jul 2010 Jan 2011 Jul 2011 Jan 2012 Jul 2012 Jan 2013 Jul 2013 Jan 2014 Jul 2014 Jan 2015 Jul 2015 Jeff Mitchell Presentation to FOR-UNM Subscribers, Nov 2015

13 NM Labor Market Review, Nov 15

14 US and New Mexico Unemployment Rate Unemployment Rate, Seasonally Adjusted, Monthly US New Mexico US BLS

15 New Mexico Unemployment Rate & Labor Force Participation Rate Jeff Mitchell Presentation to FOR-UNM Subscribers, Nov 2015

16 Employment History and Forecast MSAs and NonMetro MSA and Non-Metro Annual Employment Growth - History & Forecast 2.5% 2.0% 1.5% 1.0% 0.5% 0.0% -0.5% -1.0% Albuquerque Las Cruces Santa Fe Non-Metro Michael O Donnell Presentation to FOR-UNM Subscribers, Nov 2015: data from Quarterly Census of Employment and Wages. 12Q4 to 13Q3 reflect intro of new unemployment system and are over-stated.

17 NM Y-O-Y Job Growth by Industry, 2015 Q1 Health Care & Social Assistance Accommodation & Food Services Retail Trade Construction Transportation & Warehousing Mining Prof & Technical Services Arts, Entertaint & Rec Finance & Insurance Ag. For. Fish. & Hunting State Educational Services Real Estate & Rental & Leasing Information Other Services, Unclass Mgt Companies & Enterprises Utilities Wholesale Trade Manufacturing Admin & Waste Services Local Federal Source: BLS Quarterly Census of Employment and Wages

18 Behind the Numbers for New Mexico State s economy finally picking up some momentum in a broad-based expansion. Strength in health care and social assistance, hospitality, retail, construction, trans & warehousing, professional and technical services Medicaid Expansion is huge and is resulting in some job gains although not as much as might be expected due to competition and pipeline issues. Economy hit by declines in commodity prices, particularly oil, with WTI falling below $30 barrel for the first time in over a decade. Price above $100/b in first half Natural gas is trading close to $2 mmbtu down from $4 range in early 2014.

19 Collapse of Oil Prices $120 West Texas Intermediate, Spot Price per Barrel $100 $80 $60 $40 $20 $ Source: IHS Global Insight October 2015 July 2015 Situtation has deteriorated. Price 1/14/15: $31.13 Bad for State Budget but like a tax cut on consumers.

20 Positives the 3 T s Technology Because of the labs, universities and existing industry, & drawn by amenities But can we grow & keep these businesses. Albuquerque is certainly trying. Transportation Union Pacific s new terminal at Santa Theresa permanent new jobs (but can t find the jobs in the data) Expansion of the Port at Santa Theresa (lots of activity down there but can t find the jobs in the data) Burlington Northern s track improvements, vision for Belen Tourism A growth area. Tourists have been returning, helping to boost hospitality industry employment and earnings as well as retail trade Also renewables are making strides: Solar and wind energy, algae and other biofuels, Mesa del Sol smart grid, Tres Amigas Super Station with Albq headqtrs but will this come together UNM Bureau of Business and Economic Research

21 NM Population Growth Has Slowed Dramatically Estimated % Annual Population Growth, Source of data: US Census Bureau, Annual Estimates of Population, States Growth slightly negative again in 2015.

22 Perhaps because job prospects are better elsewhere, folks aren t coming and some New Mexicans are leaving NM Population Estimated Components of Change, Time Period Total Population Change Natural Increase Vital Events Net Migration Births Deaths Total International Domestic April 1, 2010 to July 1, ,104 36,121 88,993 52,872-9,750 5,837-15,587 April 1, 2010 to July 1, ,493 13,333 33,541 20,208 4,288 1,772 2,516 July 1, 2011 to July 1, ,864 12,114 28,306 16, ,348-7,577 July 1, 2012 to July 1, ,747 10,674 27,146 16,472-8,809 1,717-10,526 July 1, 2013 to July ,323 9,942 26,805 16,863-11,482 2,672-14,154 July 1, 2014 to July ,236 26,286 17,050-9,721 3,631-13,352 Cumulative change since 2010 Census = 25,930 Source: US Bureau of the Census UNM Bureau of Business and Economic Research

23 The New Mexico Economy: Finally Recovering from the Great Recession in NM style Maybe UNM Bureau of Business and Economic Research

24 New Mexico and resurging Albuquerque continue to pull out of the deepest and longest recession since the 1930 s. The expansion has broadened and deepened, but there have been many casualties businesses that failed because they couldn t hang on any longer, families who have left the state, businesses that have pulled up stakes to try their fortune elsewhere. Despite generous tax incentives, NM is still not attracting the interest nor the investment that it once did. It is increasingly clear that as a state we are failing our kids, which have the highest rate of poverty in the nation. Bright spots have been toursim, transportation, mining and extractive industries, and renewables but all have been affected by the collapse of energy prices. NM is a big winner from the Medicaid expansion and ACA. Our technology is attracting interest. However Federal, including contracts, state and local government together account for 32% of jobs, the highest % in the country. The NM economy is feeling the pain from federal government cut-backs and is vulnerable to future cuts, changes in federal priorities (e.g., Sandia NL procurement) NM needs to protect its water resources, to deal with income inequality and deep and persistent poverty, to address the inadequacy of its public education system. As a state we need to create a compelling vision for the future that will excite and that can attract, retain and grow our human capital as well as infrastructure and investment.

2016 Legislative Session New Money FY 17 $230.7 m $6.2 b $6.17 b $6.47 b New Money in FY17, defined as FY17 projected recurring revenue less FY16 recurring appropriations, is projected to be $231.

25 2016 Legislative Session New Money FY 17 $230.7 m $6.2 b $6.17 b $6.47 b New Money in FY17, defined as FY17 projected recurring revenue less FY16 recurring appropriations, is projected to be $231.7 million, or 3.7 percent of FY16 appropriations. This is a decrease from the August consensus which stated $293 million. The forecast presents several downside risks with uncertainties including: oil and gas prices remain at current levels weak Q1 FY16 revenues results continue tax credits continue at high Q1 FY16 pace job growth remaining within range of negative growth e-commerce sales weaken gross receipts tax Consensus Revenue Estimates, Dec. 2016

26 HSD Monthly Stat Report

29 Medicaid Enrollment Projection 925k in FY17 Just under 600k in FY k FY 17 Source: New Mexico Medicaid June 2014 Enrollment Projection Source: HSD presentation, Annual Data Users Conference, data provided in support of work on Medicaid Expansion

30 Medicaid Expansion: Conclusions HHSC The Medicaid Expansion is increasing health insurance coverage among low income adults (138% of poverty), reducing the number of uninsured and the amount of care that is uncompensated. The net flow of federal dollars into the state to provide coverage is creating an effective demand for health care services. Providers are expanding and there is an increase in the health care workforce. This is important in a state that has long been under-served. While the State will pick up an increasing portion of the costs up to 10% in calendar 2020, the program is basically paying for itself.

University of New Mexico Bureau of Business and Economic Research. New Mexico Women s Agenda Lobbying Workshop. State of the Economy: US, New Mexico

University of New Mexico Bureau of Business and Economic Research New Mexico Women s Agenda Lobbying Workshop State of the Economy: US, New Mexico January 11, 2013 Dr. Lee A. Reynis, Director lreynis@unm.edu