I missed this presentation as I was out on a REALTOR tour in Tierra Grande. Wished I could have made it. T
The Albuquerque area and New Mexico can expect job growth of 1 percent over the next few years, according to Ted C. Jones, the chief economist of Stewart Title Guaranty Co.
Jones was in Albuquerque Wednesday speaking to real estate industry executives and brokers at Sandia Resort & Casino.
Jones said other cities are outpacing Albuquerque in the economic recovery and that most other states are outpacing New Mexico. The main reason? Reliance on government jobs.
Using stats from the Census Bureau, Department of Labor and his own research, Jones said New Mexico has two times more government jobs than the average state and that Albuquerque has more than the average U.S. city — overall, about one in four New Mexicans has a government-related job. With continued government budget cuts and a shrinking of the workforce at Sandia National Laboratories and Los Alamos National Laboratory, it’s not a good sign, he said. “If you live by it, you’re going to die by it a little bit too. It’s going to take double duty for the private sector to grow jobs. It was good while it lasted, but it’s hurting now,” Jones said.
He said he doesn’t see the state “booming” again anytime soon.
“Employment is barely growing at 1 percent. There is not exciting job growth, and I expect it will track at about 1 percent for at least the next few years.”
Jones said that’s not only because of the imbalance of public and private sector jobs, but also because structural reforms will take time to kick in. He cited a Tax Foundation report that shows New Mexico is ranked No. 38 in business tax climate. He added that as baby boomers retire without adequate job participation from younger people, the market will continue to be affected negatively.
Jones said the health of the real estate business is intrinsically tied to job growth. Megatrends, he said, include a 25-year investment horizon; a continuing trend of millennials preferring to rent apartments instead of buying homes; and continued “massive uncertainty” in Washington, D.C. Other challenges for the state are the slowing of its population growth — at 0.3 percent in 2012.
Jones said, however, that hopefully the improving economy across the U.S. will positively affect New Mexico too. He cited growth in home prices, increased builder activity and retail sales, a boost in multifamily activity, and a return of U.S. manufacturing and tourism.
Jones said a “deal changer” for many states could be the rise of manufacturing jobs from an abundant supply of natural gas.
Jones, who gives about 150 presentations annually, is also the director of investor relations for Stewart Information Services Corp. (NYSE-STC). The event was sponsored by Stewart Title of Albuquerque. Stewart Title is a provider of real estate services, including global residential and commercial title insurance, escrow and settlement services, lender services, underwriting and specialty insurance.