Home News COVID-19 Situation Economic growth recorded prior to COVID-19 emergency

Economic growth recorded prior to COVID-19 emergency

0
Submitted Photo
Michael Espiritu, president of the Roswell-Chaves County Economic Development Corp.

Chaves County was experiencing an increase in economic activity during 2019, before coronavirus restrictions began, according to information released by the New Mexico Economic Development Department.

On Monday, the state issued the first of its county-level economic reports for all 33 counties in the state as part of its efforts to help state and local leaders track and address economic changes.

“We know good decisions start with good data, and we want the Economic Development Department to be a resource for all communities around the state,” Jon Clark said. As deputy cabinet secretary for the EDD, he oversaw the data reporting project.

“The goal of these reports would be to provide economic and revenue information on a quarterly basis to allow each county to see the full impact of the COVID-19 crisis and the effects of the economic recovery,” he said.

The information also can assist economic developers, job trainers, educational institutions and government officials plans for economic and job growth in general.

Mike Espiritu, Roswell-Chaves County Economic Development Corp. president, said that he anticipated the data will help members of the local Economic Recovery Task Force determine where to focus their efforts.

“That will help us pinpoint the areas that we need to assist the most,” he said.

The reports draw on information from the New Mexico Taxation and Revenue Department, the New Mexico Department of Workforce Solutions, the U.S. Bureau of Labor Statistics and the U.S. Bureau of Economic Analysis.

In addition to gross receipts taxes, they include information about wages, gross domestic product and unemployment rates and unemployment insurance claims. A county profile using U.S. Census data and other information sources is also available.

The next report due out about May 29 is expected to detail the direct effects of the coronavirus emergency and state-ordered business restrictions.

According to the February 2020 report, the county had fairly flat growth for five quarters but had begun to experience significant growth around March of 2019. From the third quarter of fiscal year 2019 (January to March 2019) to the second quarter of fiscal year 2020 (October to December 2019), matched gross receipts reported went from about $300 million to $350 million.

Matched gross receipts taxes are the best tax data available to show economic activity, the state report said, because they correlate the gross receipts taxes paid with the gross receipts reported by individual taxpaying entities. That also enables the data to be analyzed by industry sectors.

Most industry sectors in Chaves County saw growth from second-quarter 2019 to second-quarter 2020. The highest growth rates in terms of GRT reported were in arts, entertainment and recreation (78% to $1.61 million), management of companies and enterprises (72% to $128,778) and real estate sales and rentals (53% to $6.83 million). The largest industry sector for the county by far was retail, with $114.24 million in gross receipts taxes reported.

Espiritu said the retail industry, followed by the lodging industry, will see the largest short-term impacts from the coronavirus shutdowns in this area.

Decreases for second-quarter fiscal year 2020 were reported by four industry sectors: oil and other extraction industries (down 47% to $4.09 million); agriculture, fishing, hunting and forestry (down 14% to $722,416); utilities (down 7% to $15.84 million); and health care and social services (down 3% to $28.87 million).

There were some indications even by December 2019 (the end of second-quarter fiscal year 2020) that some sectors of the economy were having difficulties. The county portion of gross receipts taxes collected declined 15% overall compared to the second quarter of fiscal year 2019 and 80% for food-related businesses.

The report also included some initial reporting on third-quarter fiscal year 2020 unemployment insurance claims.

Initial claims shot up in the third quarter of fiscal year 2020 (January through March 2020). For about seven quarters previously, they stayed at about 250 each quarter. For the third quarter of fiscal year 2020, they reached about 1,800. That increase was directly linked to the coronavirus emergency and the closure of businesses and schools.

Senior Writer Lisa Dunlap can be reached at 575-622-7710, ext. 351, or at reporter02@rdrnews.com.