Braking bad. Albuquerque’s economic recovery seems to have put on the brakes. The modest job growth achieved over the 12-month span ending with August 2011 was reversed—and then some—over the 12 months following. According to data provided by the U.S. Bureau of Labor Statistics (BLS), total non-farm employment as of August 2012 was down 3,300 jobs (0.9%) from 12 months prior and was down 2,200 jobs (0.6%) over 24 months—this at a time when positive job growth over these time spans had become common fare for the nation’s local economies.
Along these lines, the On Numbers Economic Index, a new economic index devised to “identify the markets in the U.S. that are strongest economically,” placed Albuquerque “among the bottom third,” New Mexico Business Weekly reported in September: of 102 metro areas analyzed, Albuquerque placed 82nd. “Contributing factors include its negative 8.44% five-year growth rate in the private sector, its earnings per worker of $731.10 a week and its five-year house appreciation of negative 16.2%.” In addition, the metro area faces potential threats from future defense budget cuts. The losses, affecting military, defense-related civilian and related private sector employers could be substantial. A June report in the Weekly citing Washington, D.C.-based Center for Security Policy puts the potential loss at nearly 8,200 jobs and $150 million in defense contracts. Meanwhile, the rate of population growth has slipped. In 2011, at 0.9%, it had slipped below the 1.1% national average, according to Moody’s Economy.com. Small improvement, to 1.0%, is forecast for 2012.
One particularly worrisome sign is the job losses reported by BLS for the Professional and Business Services sector, a sector of major importance for the economy as a whole as well as for the local office market. Employment in this segment as of August was down 1,500 jobs (2.6%) year-over-year. Other major employment sectors—Trade, Transportation and Utilities, Construction, and Government, also suffered losses over the latest recorded 12-month span. Among the few bright spots was the Manufacturing sector, which registered a 300-job (1.7%) increase August-to-August. Contributing to the relative health in Manufacturing may be the solar energy industry. Despite the recent failure of Schott Solar, “the solar manufacturing industry in New Mexico is still very much alive, and doing well,” the Albuquerque Journal reported in October 2012. Unlike Schott, “most local producers are not making solar panels. Rather, they’re building other components for solar installations, such as mounting platforms and solar-tracking systems, which are in high demand…New Mexico’s solar-component manufacturers say business is booming.”
The local housing market remains weak. According to data from the Greater Albuquerque Association of Realtors as cited by the Weekly in July, “The average sales price of a single-family, detached home has dropped about 20% in the metro area over the past four-plus years, reflecting a trend around the country… Short sales and foreclosures continue to push down home prices.”