Published: 3:00 pm, Tue. Mar. 29th, 2016
One number and one question.
Those are where the New Mexico economic discussion goes.
The number is the ratio of employment to population. The question is why we are so low.
A second number lends insight.
That is the percentage of our population on Medicaid, which is approaching 50 percent.
That half our population needs a form of welfare is astonishing, but the situation goes back to work. If more people were working for more money, there would be less Medicaid.
Employment occupied 53.5 percent of the population in 2015. Our average employment ratio for 2014 was 56.6 percent, a decline from 2013. The definition is what you would expect.
The Pew Research Center defines the ratio of employment to population as “a measurement of employed people as a percentage of the entire adult civilian non-institutional population” 16 and over. Nationally the ratio is 59.8 for February and has been nudging fitfully up since mid- 2011.
For employment-to-population, we placed 48th nationally, our usual position. Two of the other states in the bottom four — West Virginia and Kentucky — have coal as a simple explanation for their troubles. Check with Barack Obama on that issue. Mississippi’s explanations appear more complicated, although, from what I have read, racial legacies are a big part.
A Pew publication, “Fiscal 50:
State Trends and Analysis,”
shows New Mexico leading nationally with a drop of more than seven percentage points in the employment ratio between 2007 and 2015. See http://www.pewtrusts.org/en/projects/s tates-fiscal-health.
Employment gets a second whammy. Not only are fewer people in the labor force — working or looking for work — fewer are actually working.
Framing today’s employment picture starts with the unemployment rate, 6.5 percent in January.
Alaska (6.6 percent) and Mississippi (6.7 percent) follow us.
Our year-over-year unemployment rate change, from 6.4 percent in January 2015 to 6.5 percent in January 2016, was not statistically significant on a seasonally adjusted basis, nor was our employment change.
The number of wage jobs, properly called “employees on non-farm payrolls,” grew by a seasonally adjusted 1,700 yearover-year, a tiny percentage of 0.2 percent, two tenths of one percent. Take out the seasonal adjustment and we lost 1,800 wage jobs, also two tenths of one percent, but down this time.
If you are wondering what’s real, I sympathize.
Mining, which we presume mostly means oil and gas production, took the big hit for 2015, dropping 7,700 jobs yearover-year for a 26.6 percent decline.
While the number of lost jobs is important, the points are that mining is suddenly the second smallest employment sector, with fewer well paid basic sector jobs, and the industry provides a big portion of state government’s operating budget.
By contrast, the education and health services sector added 7,300 jobs year-over-year, a 5.6 increase, growing the sector’s lead as the state’s largest. The growth, though, is only sort of private sector. It comes from Medicaid, a welfare program (not debating the necessity here), meaning that the money comes from taxes.
On top of everything else, the data have been fiddled. The Bureau of Labor Statistics explains, “At the beginning of each year, the four (employment) measures are typically revised for the previous five years as updated inputs to the models become available.” OK, it’s legitimate fiddling, a process is called “benchmarking.”
Things happen, though. A year ago the revised numbers eliminated months of job losses from 2014. The administration, through the Department of Workforce Services, happily proclaimed consecutive months of gains. This year’s changes turned the October 2015 jobs gains into losses.
Where we are is nowhere.
Some are up — education and health services. Mining is down.
The net is zero or less.
(EDITOR’S NOTE: Harold Morgan was founding editor of the New Mexico Business Journal and for years edited New Mexico Progress for Sunwest Bank. He is an economist. His column is distributed by New Mexico News Services.)