Low labor force participation 'very concerning'

Yolanda Cordova

Copyright © 2022 Albuquerque Journal

The state's labor force participation rate remains low — and New Mexico Department of Workforce Solutions leaders say some of that has to do with the high number of people in the state on disability.

DWS Deputy Secretary Yolanda Cordova on Thursday called the number of New Mexicans receiving disability benefits "very concerning." She said part of that may be due to the substance abuse issue impacting the state.

The number of disabled workers on Old-Age and Survivors' Disability Insurance totaled 61,294 in December 2020, compared to 30,940 in December 1991, according to DWS.

Cordova and Employment Services Division Director Marcos Martinez presented to the Legislative Finance Committee some of the department's findings on the low labor force participation rate at a meeting Thursday in Silver City. The two department leaders also touched on other factors leading to the low number, including an aging population and out-of-state migration of working-age adults.

"It would be great if some of our substance abuse or treatment facilities also included a work component to it, so that we could maybe do something jointly where, while they're going through recovery, we're also sort of ... talking about that transition into employment," Cordova said. "I think those are some of the primary reasons around our disability increase in our state."

The labor force participation rate is the number of working-aged people who are actively working or looking for work; the state's labor force participation rate stood at 56.7% in 2021.

Moreover, the labor force participation rate dropped 9% for men ages 25-34 from 1999 to 2021, nearly double the national decline. Women ages 35 through 44 dropped 5%, which is also double the national rate of decline for that group.

From 1999 to 2020, the number of disabled workers in New Mexico receiving Supplemental Security Income increased by more than 45% compared to the U.S. average of nearly 31%, according to the report. In that same time frame, New Mexico saw a 98% increase of those receiving Old-Age and Survivors' Disability Insurance — a doubling of the rate over the past 20 years. The national rate saw an increase of 67.2%.

Cordova's response was prompted by Sen. Nancy Rodriguez, D-Santa Fe, who asked why that number had risen so much over the span of two decades and how it can be fixed.

Cordova and the department offered no immediate plans on how to get people on disability back into the workforce, other than general solutions.

But Cordova and Martinez offered other, more pointed solutions on how to fix the low labor participation rate in a presentation that spanned more than an hour, including the creation of a program aimed at steering younger people into the workforce.

They said New Mexico doesn't have a shortage of jobs, citing the DWS report that shows more than 31,000 jobs are currently available for nonfarm employment — which includes most jobs but excludes nonprofit organization employees, farm employees and those who are self-employed.

"We do not have a lack of jobs, which is something that we normally do have," Martinez said. "Those that are unemployed are concerned that maybe the wages aren't where they need to be, so we're looking to see how we can potentially supplement that or at least supplement the employer to be able to raise those wages."

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