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The latest unemployment numbers won’t cheer your heart, which will surprise nobody. It’s hard to spin that data and yet a new study takes a slightly different view: New Mexico is better able than many states to dig itself out.
The jobless rate edged up from 7.7 to 7.9 percent for October, still below the nation’s 10.2 percent. We’re squarely in the middle, ranking-wise.
“New Mexico may have reached a statistical low point in August from which a slow recovery can be staged,” wrote a state labor economist. In that sentence, pessimists will focus on “slow.” Optimists will see “recovery.”
Every year, I do a freelance project for a business organization that requires gathering the best data I can find from multiple sources to present an economic picture of the state. This year I can’t deny that it’s discouraging to tote up the job losses, falling tax revenues, familiar stores closed, emptier hotels and car dealers out of business.
But if the glass seems pretty empty, I also found progress and movement. Some companies are still betting on the future by expanding and hiring. Some public projects are moving forward. The vast majority of us are keeping up with our mortgages.
University of New Mexico economists have been using words like “grim” and “in the tank.” Recently, an economist with the Federal Reserve Bank of Kansas City depressed a roomful of people by pointing out the obvious — energy prices are down and they’ve taken the state’s economy with it.
He also said the state’s real estate situation is worse than anywhere else in the Kansas City district. New Mexico’s housing bubble was bigger than Colorado’s and looks more like hard-hit Arizona and Nevada, he said.
Not so fast.
I hesitate to say a Fed economist doesn’t know what he’s talking about, but his real estate observations don’t mesh with other sources. Our foreclosures are probably rising some with unemployment, but New Mexico is still on the low end of foreclosures nationwide — way below the national average, way below Colorado and nowhere close to Arizona and Nevada, according to RealtyTrac.
Our low rate of foreclosures, in fact, gave us an edge recently in a peculiar beauty contest — states most unlike California.
The Pew Center on the States studied the nation’s worst financial basket case, the not-so-Golden State of California, along with eight others in similar straits. New Mexico is a long way from those nine. By the center’s measure, we’re somewhat worse off than Texas and Utah but a lot more comfortable than Colorado and Oklahoma.
The Pew Center measured change in revenue, size of budget gap, change in unemployment rate, foreclosure rate, state government’s money management (we got a B -) and whether a state needs a supermajority to resolve budget crises. Pew researchers say their analysis isn’t a complete diagnosis of states’ fiscal health, but each factor is a warning sign. Taken together, they tell us how states are faring in the recession.
More information from the Pew Center: All but two states, Montana and North Dakota, face budget shortfalls for fiscal 2010; some are contending with their largest deficits in modern history.
So you can take the political spin and blame mongering with a grain of salt. If households — or states — were living within their budgets and suddenly the budgets shrank, is that the fault of the household money managers, economic cycles outside their control, or both?
Look at the Pew Study from another angle: If these six measures are warning signs, they’re also indicators of New Mexico’s ability to recover from this recession. Compared to many other states, we don’t have as steep a hill to climb.