NM Economy Improving; Long Way To Go

The “overall message” from Federal Reserve Bank of Kansas City regional economist Alison Felix on April 18 was, “Things are improving. There is a long way to go.”
Felix spoke in Albuquerque at the Fed’s Albuquerque Economic Forum.
Today Felix got a supporting new number from the Department of Workforce Solutions and the Bureau of Labor Statistics. New Mexico’s unemployment dropped another two tenths of a point in March to 5.6%, down from 5.8% in February and 6.3% in March 2017. Maine, Ohio and Wyoming were the other states with over-the-month unemployment rate decreases. In Maine, hardly anyone is unemployed; the rate is 2.7%.
But on the other hand, that favorite economist’s expression, the state’s unemployment remained second highest in the nation, a point DWS ignored. The good news starts from a low (or high) base.
Metro Albuquerque, with 46% of employment in the state has 4.7% unemployment.
The state added 8,900 wage jobs (seasonally unadjusted) from March 2017 to March 2018 for 1.1% growth. The growth appears erratic. There were 11,000 new year-over-year jobs in February, 7,000 in January and 10,800 in December.
Construction remains the sector growth leader with 3,000 new jobs in the March year, a 4.7% increase. Manufacturing, with 1,200 new jobs, tied construction for the percentage increase lead with 4.7% growth. That manufacturing is growing at all suggests improvement in the New Mexico economy. In part, Felix said, the manufacturing slump has been tied to energy, which supports a lot of manufacturing.
Employment growth has reached Lea and Eddy counties, the oil production heartland. (Note: “employment” is different from “jobs,” developed by different methods. The categories are closely related, of course.)
Lea County employment grew by 1,310 or 5.1%, year over year. Eddy employment grew 2,026. The county job growth seems curious in light of zero mining sector job growth. The two counties do have other things happening such as Carlsbad Caverns and Urenco’s National (uranium) Enrichment Facility near Eunice.
On yet another hand for Lea and Eddy, the drilling boom in the Permian Basin that includes Lea and Eddy is running into some of the bottlenecks characterizing booms, starting a labor shortage. Pipeline capacity is beginning to be problem, the Wall Street Journal reported April 19. Pipelines for natural gas, producing along with oil, are having some of the same dilemmas. “Some producers face the prospect of shutting wells,” the Journal said.
Professional and business services was the number two job producing sector with additional of 2,600. Leisure and hospitality added 1,900. Financial activities grew by 1,200. Transportation, warehousing and utilities added 1,000.
Retail trade, down 1,100, led the losers followed by information and state government education, both down 1,000, and health care, which lost 700.