Inside the Capitol

Sunday, December 18, 2011

12-23 How to create jobs

122311 jobs

SANTA FE – What is the secret to creating jobs? Candidates promise it is their top priority but when legislative sessions roll around, conversations turn elsewhere. Blogger Joe Monahan is compiling a list. Most of the suggestions presented to far have involved the construction industry or the film industry.
Both of those industries provide somewhat seasonal jobs. But with the state of our state economy, seasonal jobs are just fine. The state has a big pile of capital outlay money sitting around but disagreements in the regular and special sessions this year prevented most of the money from being spent.
The more capital outlay funds that are spent, the more construction jobs we will see. And the beauty is that this is money that doesn't come directly out of taxpayers' pockets.
The film industry has been providing a large amount of employment in the last several years. Lawmakers suggested a thorough study of the rebate system. Gov. Susana Martinez vetoed the legislation and said she would do it herself.
So far, nothing has happened. Now that the governor's relationship with the film industry has mysteriously warmed, industry representatives are suggesting a joint study by a well- respected group.
As for other job producers, Gov. Martinez and Republican lawmakers would like to see lower taxes, especially on businesses and the wealthy because they are the ones that create jobs. They also want fewer regulations that might impede businesses.
Democrats have been trying for several years to force out-of-state corporations to pay taxes on their sales in New Mexico. Current law allows corporations operating in several states to declare New Mexico profits in states that have lower tax rates.
Lobbyists for those corporations have been able to beat down the legislative proposals. That likely will continue. Businesses operating only in New Mexico are disadvantaged by the current arrangement.
In fact, businesses based in New Mexico because they want to be in New Mexico have long been taken completely for granted. Large amounts of money have been spent by the state and local communities on travel and entertainment to lure new business to the state.
Even more money is then spent on tax incentives spread over many years. Big press conferences are held with great media coverage. Politicos from the state and local levels show up to share in the credit.
But not many of those jobs remain in the state. Once companies indicate they are movable, other states continually try to entice them into moving again. As soon as a better offer is made, those companies move again.
New Mexico must begin to pay attention to its small companies that already are here because they want to be here. It didn't take any money to get them here and it won't cost anything to keep them from moving.
What we need to worry about is keeping them in business and helping them grow. If each of our state's thousands of small businesses could be helped to add one more employee, the effect would produce many times more jobs than bringing in big companies for a brief stay.
The problem is that it isn't as sexy. It isn't as flashy for politicians and no one gets to take expensive trips or pick up the tab for big meals.
For 10 years a non-profit group in Santa Fe called Santa Fe Economic Development tried to convince state and local governments that growing our own would prove to be more reliable for creating jobs than luring new companies.
Its president, Catherine Zacher, and staff got out in the community and found out who needed help and what kind of help was needed. Training, networking and loans were arranged. Companies grew.
But the recession brought added pressures. The economic development group's resources dwindled and no governmental agency was willing to help pick up the slack.
The state must look for ways to help its loyal, home grown businesses with the level of financial resources it spends betting on strangers.


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