On June 19, 2018, a report entitled “An Equity Profile of Albuquerque” was released by the Keller Administration.
The report is a racial profile of the city and the impact race has on the city economy.
The report is an interesting read and the entire report can be read here:
http://nationalequityatlas.org/sites/default/files/ABQ_Profile_Final.pdf
(DISCLAIMER NOTE: The entire “Equity Profile of Albuquerque” is over 100 pages long containing graphs and statistics. The report entitled “An Equity Profile of Albuquerque” was researched and prepared by PolicyLink and the University of Southern California’s Program for Environmental and Regional Equity. Funding for the report came from the W.K. Kellogg Foundation. This blog article is based on the information gleaned from review of the report, should not be considered a total nor complete summary of the report, and quotes the report extensively with references to pages numbers.)
According to the Keller Administration, the report will serve as a guide for the city’s newly reorganized Office of Equity and Inclusion which was created by the previous administration last year.
The Equity Profile Report examined the indicators of economic and social inclusion and found that “equitable growth” leads to a stronger local economy.
In the report, and “equitable city” is defined as “when all residents – regardless of their race/ethnicity, nativity, gender, income, neighborhood of residence, or other characteristics – are fully able to participate in the city’s economic vitality, contribute to the region’s readiness for the future, and connect to the region’s assets and resources.” (See “An Equity Profile of Albuquerque”, page 11).
Not surprising, the report found persistent inequities by race and gender are holding the city back from having a stronger local economy.
POPULATION GROWTH DRIVEN BY PEOPLE OF COLOR
According to the report, the overall population of Albuquerque is growing, increasing from roughly 546,000 to 554,000 between 2010 and 2014.
Albuquerque’s population growth is being driven by communities of color.
The report found that forty-seven percent of the city’s residents identify as Latino or Hispanic.
Between 1980 and 2014, the White population grew but their share of the overall population shrank from 60 to 41 percent.
Between 1980 and 2014, the number of Whites increased from roughly 203,400 to 228,900.
During the same time period the number of people of color grew from 133,500 to about 324,700.
The vast majority of Latino and Hispanics in Albuquerque were reported born in the United States.
According to the report, in the year 2015, 6 out of 10 Albuquerque residents are people of color as compared to 1980 when 4 in 10 were reported as people of color.
The rapid demographic change created a large “racial generation gap” that can not be ignored.
74 percent of Albuquerque’s youth (under age 18) are people of color, compared with 37 percent of the region’s seniors (65 and older) who are people of color, a 38 percent difference.
The gap between youth and seniors red flags a serious problem educating Albuquerque’s future generations.
Studies show that the larger gap between the two age groups corresponds with lower investment in public education.
“In general, unemployment decreases as educational attainment increases.
However, Latinos in Albuquerque with some postsecondary education, but not a BA, face higher rates of joblessness than those with some college, but no degree.
On the other hand, Latinos with a BA degree or higher have very low unemployment – even lower than their White counterparts.
The report suggests that many of the differences in unemployment by race/ethnicity are partly explained by differences in education.
The report suggests that the difference in unemployment by race/ethnicity among people with the same education level tended to be smaller.” (See “An Equity Profile of Albuquerque”, page 41.)
The report found that unemployment has decreased steadily since 2011, but the economic recovery in Bernalillo County has occurred at a slower rate than the nation as whole.
By 2015, the overall unemployment rate was 5.9 percent, which is higher than the national average, but still lower than the rate for the state of New Mexico at 6.6 percent.
CITY’S MIDDLE CLASS IS SHRINKING, LOWER INCOME CLASS INCREASING
Albuquerque’s middle class is shrinking while the lower-income class is increasing.
“Since 1979, the share of households with middle-class incomes decreased from 40 to 35 percent.
The share of upper-income households also declined, from 30 to 28 percent, while the share of lower-income households grew from 30 to 37 percent.
According to the reports analysis, middle-income households are defined as having incomes in the middle 40 percent of household income distribution.
In 1979, those household incomes ranged from $33,130 to $78,276.
To assess change in the middle class and the other income ranges, the report calculated what the income range would be today if incomes had increased at the same rate as average household income growth.
Today’s middle-class incomes would be $34,890 to $82,435, and 35 percent of households fall within that range.” (“An Equity Profile of Albuquerque”, page 34.)
“POVERTY” AND “WORKING POVERTY”
One of the most troubling findings of the report is that “poverty” and “working poverty” is on the rise in Albuquerque. (“An Equity Profile of Albuquerque” page 38.)
The poverty rate in Albuquerque was similar to the national average between 1980 and 2000.
However, since 2000 the share of residents in the city living in poverty has spiked.
Today, nearly 19 percent of Albuquerqueans live below the federal poverty line, which is just $24,000 a year for a family of four.
Working poverty, defined as working full-time with an income below 200 percent of the poverty level (roughly $48,000 for a family of four), has also risen.
In 2014, about 10 percent of the city’s 25 to 64-year-olds were working poor.” (“An Equity Profile of Albuquerque”, page 38)
It has been consistently found that communities of color are the one that are always the most impacted by the lack of economic opportunity.
EDUCATION, WAGE AND INCOME DISPARITY
26 percent of Native American women, 18 percent of Latino and Native American men, and 15 percent of Latina women are working full-time but earning less than 200 percent of the federal poverty level which is $48,000 for a family of four.
It is common knowledge that wages tend to increase with higher educational attainment.
The report found that women of color consistently earn the lowest wages at every level of education.
“White men have among the highest unemployment rates among the population with a high school diploma but no college, but those who are employed make $2 an hour more on average than men of color and $5 an hour more than women of color.
The wage gaps persist even among those with high levels of education.
“Albuquerque ranks 34th of the largest 100 cities in the share of residents with an Associate’s degree or higher.
Compared to other cities in neighboring states, Albuquerque’s education levels are relatively high.
Albuquerque’s 44 percent of residents with an Associate’s Degree or higher is greater than Tucson, Arizona and El Paso, Texas – both of which are at 32 percent.” (See page 64.)
Women of color with a Bachelor’s degree or higher earn about $10.50 an hour, less than White men and about $4 an hour less than White women.” (“An Equity Profile of Albuquerque” page 43.)
Notwithstanding, the report found that people of color have lower median hourly wages at virtually every educational level compared to their White counterparts.
“White workers with some college but no degree earns more than workers of color with an Associate’s degree.
The racial wage gap persists even at the highest education levels.
The median wage of Albuquerque people of color with a BA degree or higher is $25 an hour compared with $29 an hour for their White peers. (An Equity Profile of Albuquerque, Page 42)
“According to the Georgetown Center on Education and the Workforce, in 2020, 36 percent of New Mexico’s jobs will require an Associate’s degree or higher.
While many of the region’s workers currently have that level of education, there are large differences in educational attainment by race and ethnicity.
Only 14 percent of Latino immigrants, 31 percent of U.S.-born Latinos, and 32 percent of Native Americans have an Associate’s degree or higher.” (See “An Equity Profile of Albuquerque” Page 63.)
ALBUQUERQUE JOB GROWTH RATES
The report found that wage growth in Bernalillo County has been positive across all industries, with the exception of mining and arts, entertainment, and recreation.
Administrative and support, and waste management and remediation services, finance and insurance, and real estate have the highest growth in earnings since 1990.
Among low-wage industries, all sectors except arts, entertainment, and recreation experienced 20 percent or higher changes in earnings compared to 1990.” (An Equity Profile of Albuquerque, page 45, 46 and 48.)
According to the report’s industry strength index, the region’s strongest industries are health care and professional services.
Health care had a 34 percent increase in employment between 2005 and 2015.
Professional services rank second due to its high average annual wage and relatively strong concentration of jobs in the region. (“An Equity Profile of Albuquerque”, Page 49.)
INDUSTRIES EXPECTED TO GROW
The industries that are expected to grow over the 10-year period from 2014 to 2024 are as follows:
Agriculture, Forestry, Fishing & Hunting
Mining, Quarrying & Oil & Gas Extraction
Construction
Manufacturing
Wholesale Trade
Retail Trade
Transportation & Warehousing
Information
Finance & Insurance
Real Estate & Rental & Leasing
Professional, Scientific & Technical Services
Management of Companies & Enterprises
Administrative & Support & Waste Management & Remediation Services
Educational Services
Health Care & Social Assistance
Arts, Entertainment & Recreation
Accommodation & Food Services
Other Services (Ex. Public Administration)
Federal Government
State Government, Excl. Education & Hospitals
Local Government, Excl. Education & Hospitals
Self-Employment & Unpaid Family Workers
(“An Equity Profile of Albuquerque,” page 46.)
OCCUPATIONS EXPECTED TO GROW
The occupations that are expected to grow over the 10-year period from 2014 to 2024 are:
Management Occupations
Business & Financial Operations Occupations
Computer & Mathematical Occupations
Architecture & Engineering Occupations
Life, Physical & Social Science Occupations
Community & Social Service Occupations
Legal Occupations
Education, Training & Library Occupations
Arts, Design, Entertainment, Sports & Media Occupations
Healthcare Practitioners & Technical Occupations
Healthcare Support Occupations
Protective Service Occupations
Food Preparation & Serving Related Occupations
Building & Grounds Cleaning & Maintenance Occupations
Personal Care & Service Occupations
Sales & Related Occupations
Office & Administrative Support Occupations
Farming, Fishing & Forestry Occupations
Construction & Extraction Occupations
Installation, Maintenance & Repair Occupations
Production Occupations
Transportation & Material Moving Occupations
(“An Equity Profile of Albuquerque,” page 47.)
SUMMARY CONTAINED IN REPORT:
“While the nation is projected to become a people-of-color majority by the year 2044, Albuquerque reached that milestone in the 2000s. Since 1990, Albuquerque has experienced dramatic demographic growth and transformation – driven mostly by an increase in the Latino and Asian or Pacific Islander population. Today, these demographic shifts – including a decrease in the percentage of White residents – persist.”
“Albuquerque’s diversity is a major asset in the global economy, but inequities and disparities are holding the region back. Albuquerque is the 59th most unequal among the largest 100 metro regions. Since 2000, poverty and working-poverty rates in the region have been consistently higher than the national averages.”
“Racial and gender wage gaps persist in the labor market. Closing racial gaps in economic opportunity and outcomes will be key to the region’s future. Equitable growth is the path to sustained economic prosperity in Albuquerque.”
“The region’s economy could have been more than $10 billion stronger in 2014 if its racial gaps in income had been closed: a nearly 20 percent increase. By growing good jobs, connecting younger generations with older ones, integrating immigrants into the economy, building communities of opportunity, and ensuring educational and career pathways to good jobs for all, Albuquerque can put all residents on the path toward reaching their full potential, and secure a bright future for the city and region.” (“An Equity Profile of Albuquerque”, page 4.)
COMMENTARY
Albuquerque has one of the highest unemployment rates in the country.
For the last 8 years, the prior administration failed to attract a single major corporation or company to relocate to Albuquerque.
Further, very little if any progress was made to create economic based jobs.
The Keller Administration approved budget of $3.9 million for the Economic Development is so a meager as to be an embarrassment given the fact that the city has a total operating revenue and approved budget of at almost a billion dollars at $955,300,000 for fiscal year 2018-2019.
The City Council enacted a one-eighth of a cent tax increase that will generate an additional $55 million a year.
Gross receipts tax revenues from the state are now being reported in excess of what was projected.
The city is seeing a 4% to 6.8% increase in gross receipts tax revenues compared to last year from the state as a result of increase in business activity.
https://www.abqjournal.com/1178079/abq-sees-bump-in-gross-receipts-revenue.html
Candidate for Mayor Tim Keller proposed as a “big idea” creating personal or individual Tax Increment Districts (TIDS), more use of industrial revenue bonds and tax incentives to attract new industry to Albuquerque and create jobs.
As Mayor, Keller proposed no major increased appropriation for economic development in the approved 2018-2019 budget.
As far as “economic based jobs”, or jobs that are created by a business that exports goods or services thereby expanding the economy intake and that provide higher wage jobs, the Keller Administration has yet to announce anything different, nor fund anything different, than what has been going on at city hall for the last 8 years.
Albuquerque can and must expand and find better ways to use financial incentives for economic development in the growth industries.
Tax increment districts (TIDS), industrial revenue bonds, and economic development investment programs such as initial startup funding with claw back provisions has always been the traditional approach.
The city’s Economic Development Department needs to find a better way.
A good start would have been funding a $20 million initial startup fund for new businesses with claw back provisions with the program administered by the Economic Development Department.
Albuquerque needs to pursue with a vengeance real growth industry like healthcare, transportation and manufacturing, the film industry to diversify our economy,especially those industries and occupations that are identified in the “Equity Profile of Albuquerque”.
Public-private partnerships in the growth industries where ever possible should be encouraged and developed.
Albuquerque’s taxpayers must be convinced by Mayor Keller and the City Council of the importance of economic development in the growth industries and not the service industries.
