New Mexico’s economy has taken a harder hit from the COVID-19 pandemic than the nation overall and a comparable state.
A project, led by Harvard University, Brown College and the Bill & Melinda Gates Foundation, breaks this effect down, by the numbers, on a website (tracktherecovery.org).
“The tracker is built using anonymized data from several private companies, such as credit card processors and payroll firms. From this data, we construct statistics on consumer spending, employment rates and other indicators by county, industry and pre-crisis income level,” according to the study.
The project has five categories broken down into subcategories.
- Spending: Customer spending.
- Businesses: Small-business revenue, small-businesses open and job postings.
- Employment: Employment and unemployment claims.
- Education: Online math participation and student progress in math.
- Public Health: COVID-19 and time outside home.
Data referenced is on the website and is from Dec. 6, the most recent available.
Across the nation, consumer spending has decreased by 1.7 percent, compared to January 2020. New Mexico had the second-lowest consumer spending rate in the country, with a decrease of 14.1 percent, and Sandoval County has seen a decrease in consumer spending by 6.9 percent, compared to January.
From March-April, Sandoval County saw a low in consumer spending of 35.3 percent below January levels. Since April, the county has been on an upward trend, on Nov. 14 reaching a high of 1.4 percent below January, before dropping again.
A few key findings were:
- High-income households account for a reduction in spending.
- Affluent areas have seen the most decline in small-business revenues.
- The most significant amount of job losses occurred at small businesses in affluent areas.
- Re-openings of the economy — state-ordered — had small effects on economic activity.
“Some states began to re-open non-essential businesses as early as April 20, while others waited until the end of May. By comparing the trajectory of early-opening states to similar states that remained closed, we find that re-openings increased spending and revenues only modestly,” according to the study.
For example, Colorado and New Mexico were nearly identical in customer spending rates from February through May.
New Mexico placed a stay-at-home order before Colorado and lifted its order later. Colorado issued a stay-at-home order March 26 – May 9, while New Mexico issued its stay-at-home advisory March 24-May 31, then reinstated it Nov. 6.
Colorado had average consumer spending rates, compared to January, of:
- February: down about 1.8 percent,
- March: down about 13.2 percent,
- April: down about 32.2 percent,
- May: down about 18.7 percent
- June: down about 13.9 percent,
- July: down about 10.7 percent,
- August: down about 9.6 percent,
- September: down about 9.8 percent,
- October: down about 8.6 percent, and
- November: down about 8.2 percent.
New Mexico had an average consumer spending rate, compared to January, of:
- February: up about 0.75 percent,
- March: down about 9.5 percent,
- April: down about 29.3 percent,
- May: down about 19.75 percent
- June: down about 15.4 percent,
- July: down about 12.9 percent,
- August: down about 8.3 percent,
- September: down about 6.6 percent,
- October: down about 7.5 percent, and
- November: down about 9.9 percent.
“These findings show that it is the fear of COVID19 itself, not executive orders restricting business activity, that are the primary cause of reduced economic activity and job loss,” according to the study.
While keeping this in mind, as of Dec. 17, New Mexico has had 6,011 total reported COVID-19 cases per 100,000 people and 100 total reported COVID-19 deaths per 100,000 people.
In Colorado, as of Dec.17, there were 5,246 cumulatively reported COVID-19 cases per 100,000 people and 74.1 total reported COVID-19 deaths per 100,000 people.
On Dec. 18, the New Mexico Economic Development Department released a report containing information about employment and the economy through September.
In April-June, about 80,000 New Mexicans claimed unemployment, according to the report. From July-September, the amount of people making claims spiked to about 150,000. From October-December, unemployment rests at 60,000 claims, according to the report.
“As we continue into early and mid-2021, it is likely the number of initial unemployment claims will vary based on the effects of the pandemic but gradually wane; however, it is impossible to predict how quickly the employment numbers will return to pre-COVID-19 levels,” according to the report.
The report also evaluated the state’s industries’ gross receipts on a year-over-year basis. The recreation and arts industry saw the largest drop in gross receipts, 57 percent. This amounts to a loss of about $55.3 million.
This was followed by:
- Mining, quarrying and oil and gas extraction industry dropped 47 percent in gross receipts,
- Information and transportation decreased by 30 percent,
- Wholesale trade decreased 29 percent,
- Housing decreased by 23 percent, and
- Education and the foodservice decreased 21 percent in gross receipts.
For more information on this data, view the NMEDD report.