LFC report tackles NM workforce participation issues

Hot on the heels of RGF’s posting of a Wallethub report which cited the challenges of New Mexico businesses in finding workers. Almost simultaneously the Legislative Finance Committee produced an 80-page report addressing issues with New Mexico’s low workforce participation rate.  It is another worthwhile report from the LFC which has taken up the issue of New Mexico’s poor workforce participation.

Here are some findings:

• There are 206 thousand able-bodied prime working-age people in New Mexico who are not formally employed.
• New Mexico, which had the third-lowest male labor force participation rate in 2023. Low male workforce participation is particularly concerning for New Mexico because it negatively affects individual happiness and productivity, family formation, and household income.
• New Mexicans across all levels of educational attainment are less likely to participate in the labor force, but the difference between the state and national averages are most pronounced for those with only a high school degree or equivalent.
• Labor force participation correlates with economic growth, crime reduction, and increased average per capita earned income.

As the report notes right in its title, “New Mexico’s Workforce System is Not Effectively Reaching the State’s Disengaged Population.” Sadly, while the report discusses ways to shift around bureaucratic resources in ways that may (or may not) improve New Mexico’s workforce participation rate, it doesn’t tackle the bigger issues. And, perhaps since this is a legislatively produced report, it couldn’t.

Here are some ideas we’d like to see tried:

1. Reduce New Mexico’s generous welfare programs, especially for able bodied working age adults.
2. Remove unnecessary barriers to work in the form of taxation and occupational licensure.
3. New Mexico’s broken education must be reformed. RGF has LONG advocated for school choice and increased accountability in education. 1

There’s more, but if New Mexico policymakers even began to get serious about reforming these policies they could push more New Mexicans into gainful employment and off of government benefits.