New Mexico has the highest rate of adults in poverty and lower wages than surrounding states, according to a government report.
Ismael Torres, chief economist for the Legislative Finance Committee, presented an outlook on the state’s workforce and economy to state lawmakers at Central New Mexico Community College in Albuquerque on Tuesday. Torres’ report included a map of New Mexico and the states it borders — Arizona, Utah, Colorado and Texas — that showed New Mexico has the highest rate of childhood poverty among those states and the lowest average hourly private sector wages.
Utah had the lowest rate of childhood poverty at 9%, compared to New Mexico’s 22%, and Colorado had the highest hourly wage at $40, compared to New Mexico’s $31.
“Economic research establishes strong connections between childhood poverty and lifetime earnings,” Torres said during the hearing. “We are already starting from a challenging position.”
Torres told lawmakers that increased wages typically drive productivity in the workforce. Democratic and Republican lawmakers alike told Torres that they want to closely track how the state’s investment in universal childcare impacts the workforce — both by leading to new jobs in the childcare industry and by enabling parents who previously stayed home to re-enter the workforce.
“We need to figure out how we measure success for that,” Sen. Pat Woods (R-Broadview) told Torres.
Elected leaders have focused specifically on the state’s struggling workforce. In April, a Legislative Finance Committee report found that 32,000 young New Mexicans are neither working nor going to school, leading to an annual taxpayer cost of about $623 million, primarily through lost tax revenue.
Tuesday’s report also focused on the downstream effects the state’s workforce has on its economy and its gross domestic product. The new LFC report found that state government makes up one-fifth of New Mexico’s GDP, making it the single largest contributor in the state. Mining, quarrying and oil and gas extraction comprised 12.1% of the state’s GDP, making it the second-largest contributor.
Some Republican lawmakers took issue with that characterization, though. Rep. Rebecca Dow (R-Truth or Consequences) argued that the report’s representation of state government’s contribution to the state’s GDP is likely a severe undercount and said that some industries contributing to the GDP, such as insurance, rentals or leasing, included government contracts or leases for government facilities.
“Other than oil and gas, all of these are driven by government, primarily,” she said, adding that one “almost” needs a lobbyist to do business in the state.
She also criticized the state’s Opportunity Scholarship for opening the door for students to freely pursue classes and degrees that may not provide tangible benefits to the state’s economy.
“I can take a class about how to dress like Bad Bunny and the taxpayers will pay for it. So why should I try for engineering?” she asked.
Remarks on the Iran war and the cost of gasoline regularly punctuated Tuesday’s presentation. While economic uncertainty characterized many of the financial decisions leading into this year’s legislative session, Torres highlighted that the state’s general fund revenue is performing better than predicted as the fiscal year ends in June.
In addition to the general fund, Torres said that increased oil and gas revenue, attributable in part to the Iran war, has led to a cash influx for a number of state funds, including the Early Childhood Education and Care Trust Fund, the Medicaid Trust Fund and the Behavioral Health Trust Fund.
A lot had changed since lawmakers adjourned the 2026 legislative session in February, Torres said.
“Leaving the session…we were looking at a little bit of a cash crunch ending the fiscal year,” he told lawmakers.
