Many of these employers were manufacturers who wanted to seriously consider New Mexico due to our skilled workforce, national laboratories, proximity to Mexico, and strong and established industries, such as defense.
I’m pleased to report that we have made tremendous progress in making New Mexico more competitive and welcoming, achieving significant tax reform with strong bipartisan support. In fact, when we passed the New Mexico Jobs Package earlier this year, the Senate Finance Chair, a Democrat, described it as “the closest thing we’ve had since I have been here to true, total tax reform.”
The jobs package reduces the tax rate on businesses from 7.6 to 5.9 percent, which is below the national average and makes us much more competitive regionally. It also makes us more attractive to business investment according to the New Mexico Tax Research Institute.
For manufacturers specifically, it also amends New Mexico’s tax code to allow for what is called a “single-sales” factor, ensuring that we will no longer penalize New Mexico manufacturers that export their goods. This is critically important if we are to maintain our current ranking as the fastest-growing state in the nation for exporting. In three years, New Mexico has climbed from the 38th in the nation in export growth to first.
And how do New Mexico employers view the recently concluded legislative session? The head of the Greater Albuquerque Chamber of Commerce called it “the best (session) for business that I have ever witnessed – and I have witnessed a lot of them.”
Prior to the most recent session, we were also able to eliminate some of the double and triple taxation that has plagued the manufacturing and construction sectors through reform to our gross receipts tax system.
In addition to making structural reforms to tax laws, we are also investing millions in the Local Economic Development Act, which serves as a closing fund for recruitment and expansions. This money goes toward infrastructure projects that are tied to direct job creation.
We are also investing in the Job Training Incentive Program (JTIP), where the state partners with businesses to pay part of the salaries of new employees during their training phase. It has become a model program that companies all over the state have utilized to produce high-wage jobs and train workers.
I am firmly committed to making sure our students are well prepared for the jobs of tomorrow. State data shows that, for the class of 2011, only 63 percent of our high school students were graduating within four years. And while there is quite a bit of work that remains, we have seen marked improvement, with 70 percent of New Mexico’s seniors graduating in 2012.
New Mexico is on the move. Today, I speak with employers and they are much more open and interested in investing, relocating, expanding and hiring in our state. While we can never rest and must always seek to improve, we are making significant progress.
There is more reason for optimism in New Mexico than there has been for quite some time, and both Republicans and Democrats deserve the credit for having worked together to send a message to employers that New Mexico is open for business.