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A recent Business on the Border luncheon in Las Cruces illustrated that the Mesilla Valley has fared better with job generation than both the national average and New Mexico as a whole — though it’s still behind the peak employment growth numbers of the mid-2000s.
At that luncheon, Christopher Erickson, Ph.D., from New Mexico State University’s College of Business, said that even though the country seems to be emerging from a staggering 20 months of recession, it will probably take about three years to catch up to pre-recession employment levels.
Economic developers in Southern New Mexico, however, see positive signs.
They are working with three manufacturing companies, two aerospace companies, two renewable energy companies, one food processing company, and one high tech company, all of which are considering moving to the region.
Together they could build 2 million square feet of office space and hire as many as 700 people if they choose Doña Ana County as their home.
Statewide observers hope Mesilla Valley’s positive trend echoes throughout the state.
The state’s economy is sensitive to changes in the energy market and the political arena, and its economic development depends, in part, on incentives to attract businesses.
State feels energy
Because New Mexico is an energy exporter, global energy markets directly impact our economic health.
Each $1 decline in oil prices reduces the state tax revenues by $3.5 million. Each 10 cent fall in natural gas prices reduces state tax revenues by $10.8 million.
Increasing energy demands in India and China mean prices will exceed what customers paid in previous decades, but energy-producing countries need to prepare for increased market volatility.
The private sector is likewise wary of a new administration in Santa Fe and what warmth it might — or might not — show the business community.
They worry about the future of business-attracting incentives as New Mexico copes with diminished tax revenues.
Even the successful Job Training Incentive Program (JTIP) is at risk; recent changes lowered the reimbursable amount on JTIP funding in urban areas from 50 percent to 30 percent.
The threat of further reductions has communities concerned.
If New Mexico hopes to compete with neighboring states, it needs localized economic development incentives.
El Paso recently acquired 1,000 acres of land in Tornillo to develop an industrial park and port of entry by 2012;.
This could affect New Mexico’s port of entry and future economic development in Santa Teresa.
But economic developers see reasons for optimism in the Mesilla Valley.
In the recent past, businesses hesitated to relocate because financing opportunities were hard to find.
Economic developers now field fewer inquiries about financing and building vacancies and more about the availability of workers and building opportunities.
This suggests that businesses are finding financing and preparing to hire and build – and that bodes well for economic development in New Mexico.
Davin Lopez is president and chief executive officer, Mesilla Valley Economic Development Alliance
Finance New Mexico is an initiative of the New Mexico Small Business Investment Corporation (NMSBIC) and its partners to assist individuals and businesses in obtaining skills and funding-resources for their business or idea. To learn more, go to www.FinanceNewMexico.org.