I am writing today to announce the closure of the New Mexico Independent. After three and a half years of operation in New Mexico, the board of the American Independent News Network, has decided to shift publication of its news…
While environmental activists played their part yesterday during demonstrations at the capitol building, going so far as to dress up as solar panels and to sing the tune of “You Are My Sunshine,” their counterparts, the anti-cap-and-trade contingency who has…
Roughly one quarter of University of New Mexico students are unimpressed with the state’s flagship public school, according to a survey that questioned college students about their higher education experiences.
Despite a steady rebound in output, continued high unemployment plagues cities and states across the country. Albuquerque is no different, having fully regained its pre-recession output levels but still struggling with an unemployment rate that has more than doubled since the recession began. The result is a widespread lingering insecurity while policymakers scout around for the next thing they can do to spur job creation. One idea advanced by a prominent centrist think tank in a report released this week is for metropolitan cities to zero in on an export strategy.
In order to do that effectively, cities have to understand the degree to which they are already exporters, and in what industries they have existing potential. By the Brookings Institution’s measure, Albuquerque is well-positioned, exporting 13.4 percent of what it produced in 2008. That’s the highest percentage among metropolitan cities in the mountain west, and it produced 26,498 jobs for New Mexicans.
Almost half of the $4.5 billion in 2008 Albuquerque exports came from the computer and electronics manufacturing sector. Research and development activities were about 10 percent.
“In the short term, Albuquerque—like much of the country—needs jobs, and it should tap into fast growing foreign demand,” said Jonathan Rothwell, Brookings Senior Research Analyst and co-author of a report about the export potential of the 100 largest metropolitan cities in the U.S.
Rothwell noted that the first quarter of 2010 saw three percent growth in gross domestic product nationally, while the export market grew by 16 percent. In the short term, becoming export growth can solve a jobs problem. In the long run, export jobs are good jobs, he said.
“The average export wage in Albuquerque is $69,000 compared to the average U.S. wage of $45,000,” Rothwell said. And often, he said, jobs in export oriented sectors are a good source of employment for people with high school level degrees.
But the fact that Albuquerque’s export growth is lower than the average of 100 metropolitan cities nationwide shows that the export sector here needs to be more innovative and aggressive, the report’s authors suggest.
The important thing is innovation that produces more patents and new products from Albuquerque businesses, Rothwell said. The city should also focus on training, “and more training,” to build its workforce.
In its report, Brookings makes a point of saying that some long standing economic development activities engaged in by cities and states are “outdated and wasteful.” Rothwell gave the example of competition with other communities to recruit businesses.
“Instead of just focusing on business recruitment, Albuquerque should look at how existing businesses can boost their potential,” he said. “Then, there is no net loss for U.S. companies.”
The data Brookings used to quantify exports is derived from a different methodology than the usual census numbers used as a baseline by economists and other analysts.
According to Brookings, the standard data leaves our services, which account for thirty percent of the export market. For instance, the manufacture of a computer chip in Albuquerque that is sold outside the country is an export activity. Likewise, when the University of New Mexico provides educational services to a foreign-born student, it’s a service export.
And, they also are flawed in that they sometimes don’t capture the actual state in which a product is made, allocating it instead to a state where it was bundled with other goods as it makes its way to market.
The Brookings data attempts to capture the wide array of goods and services that bring in foreign dollars, by using a value added approach, in which cities are assigned value based on the percentage of a particular market they hold. For instance, if the Albuquerque produces 5 percent of the electronics and consumer goods in the country, then it is assigned 5 percent of the aggregate value of those goods that are exported.
University of New Mexico Anderson School of Management Professor Dante DeGregorio, in an interview with The Independent, agreed that the normal census data used to quantify export activity leaves a lot out. But, he said, its generally thought that even though the data set is flaw, if used consistently, the same method of calculation over time will show how well exports are doing, or not.
Nonetheless, the approach of the Brookings Institute is a good one, he said, when it comes to understanding the actual level of exports generated by a given metropolitan city.
