Historically and today, agriculture is a foundation of New Mexico's economy. The 1997 Census of Agriculture indicates there are 14,094 farms in the state - 2 percent less than in the 1992 census. In Dona Ana County, the 1997 Census reports 1,290 farms. The average size of a farm is New Mexico is down slightly as well, from 3,281 acres in 1992 to 3,249 acres in 1997. However, the market value of agricultural products increased 29 percent to $1.6 billion in 1997. Crop sales accounted for 29 percent of the market value, livestock sales accounted for 71 percent.
New Mexico claims a role in technology far larger than its size would suggest. The state is highly supportive of its technology and manufacturing sector, creating towns such as Los Alamos. Although small, within its working population there are probably more Ph.Ds per capita than any other city in the country. For many years, New Mexico's name has been synonymous with federal nuclear research and development. With the end of the cold war, there has been a reduced emphasis on military research and an increased diversification effort into more commercial and public R&D applications. New Mexico's role in the development of precision optics is also significant, and growing and scientific research is another field in which New Mexico is at the forefront. The Energetic Materials Research and Testing Center is Socorro performs explosives research, exemplifying New Mexico's work in highly practical fields of technology. Space-related development, combined with the projected construction of a spaceport, is showing promise for New Mexico.
In Las Cruces, General Dynamics Worldwide Telecommunication Systems, a business unit of General Dynamics (NYSE:GD), will provide enhanced satellite operations and teleport services through a new facility being developed at the Arrowhead Research Park of New Mexico State University. The facility, called the General Dynamics "SpacePlex," will enable General Dynamics Worldwide Telecommunication Systems to provide satellite command and control services, network operations and ground-station support up to 100 satellites. General Dynamics Worldwide Telecommunications Systems presently supports dozens of satellites for NASA and the Department of Defense at locations in New Mexico, Colorado, Maryland, Maine, Guam and California; and serves commercial customers through the operations in Las Cruces.
With more than 200 satellite professionals in the New Mexico area supporting customers, General Dynamics is positioned to be the largest fee-for-service satellite operations support provider in the country. The new Las Cruces facility will enable the company to support additional spacecraft as demand for its services grows.
Job growth in the last three years has stayed around 2 percent. Trade, services and government employment accounts for 77 percent of total nonagricultural jobs, with services and trade posting annual gains of 2.5 percent and 2 percent respectively. Within the services sector, membership organizations, education and business services have experienced the highest growth. Wal-Mart is the largest private sector employer in New Mexico (9,270 employees), with a large distribution center in Los Lunas and stores throughout the state.
Technology is also driving an intense growth in international trade. New Mexico's exports to the world grew by 5 percent in 1998 (US exports fell by 1 percent in the same period) to a record $1.975 billion. In the first quarter of 1999 exports from this state increased by a robust 76 percent over the same quarter in 1998. The major growth is coming from electric and electronic equipment, which has increased 90 percent. Intel is a huge contributor to these numbers. New Mexico, along with much of the West, is one of the fastest growing states in the U.S. with 1,736,931 residents in 1998. Most of the population growth is occurring in the metropolitan areas. The U.S. Census Bureau ranks Las Cruces among America's fastest growing urban areas.
Employment naturally follows this trend of growth, but at a stronger pace. In 1998 there were 725,000 non-agricultural jobs in the state (a 24 percent increase since 1990), with 65 percent of these jobs in the metro areas (see Demographics for detailed information on New Mexico's three Metropolitan Statistical Areas and population growth trends). The 1998 averaged annual unemployment rate was 6.2 percent.
- Property Tax Exemption - For industry financed with industrial revenue bonds, a local government may, at their discretion, offer a real and personal property tax exemption of up to 30 years.
- Gross Receipts & Compensating Tax Deduction - equipment that goes into a plant financed with industrial revenue bonds is exempt from the gross receipts or compensating tax of 5 percent.
- Investment Credit Act - A credit equal to 5 percent can be applied to the purchase of equipment used in a manufacturing operation. The company must employ one new full-time equivalent (FTE) employee for each $100,000 of qualified equipment.
- Double Weighted Sales Apportioning Corporate Income Tax - Use of a new four-factor formula in computing New Mexico state income tax on corporations can save money for corporations that have a majority of their sales outside the state.
- Industrial Development Training Program - The New Mexico Industrial Development Training Program provides classroom and on-the-job training. Eligible workers are selected by the company from its entire labor pool. This program is directed primarily toward manufacturers although, under some circumstances, it can be used to assist businesses in the services sector. Maximum training is 1,040 hours with the program paying one-half of the training employees' wages (in rural area it pays up to 80% of the wage and training expense).
- 800 and WATS Line Tax Exemption - In 1992 legislation was passed preventing the state from taxing 800/WATS and certain other private communication services.
- Research and Development Tax Reduction - Research and development services produced by a business with a New Mexico office but sold for initial use to an out-of-tax credit of 30 percent of the cost of the care, not to exceed $30,000 per year. Any unused portion can be carried forward for up to three years. The child care must occur during employees' normal work hours.
- Cultural Preservation Tax Credit - Any company that engages in a project to restore, preserve or rehabilitate a property included in the New Mexico Register of Cultural Properties may receive a tax credit of up to 50 percent of the cost not to exceed $25,000 per year. Any unused portion can be carried forward for up to four years. Projects are approved in advance by the New Mexico Office of Cultural Affairs.