The Las Cruces City Council reviewed the state of the city’s economic health during Monday’s work session. Las Cruces reported a 7.7% unemployment rate in December of 2020, up approximately 3% from the previous year.
City Economic Development Director Griselda Martinez says the rise in unemployment can be directly connected to the COVID-19 pandemic.
“There is a direct correlation between the public health orders and the level of unemployment that you see in the 2020 data,” Martinez said. “For the first time, we had lower numbers in unemployment than we did from the Great Recession. So, we were at the verge of growing beyond 2008 numbers, and then the public health orders came about and that took us back to really high numbers of unemployment.”
2020 unemployment in Las Cruces reached its peak in July, rising to 13.6%. Kyle Eagar, from the Las Cruces Economic Development Department, says unemployment has fluctuated drastically month-to-month.
“The two takeaways…are one, the unemployment rate has been higher every month in 2020, compared to 2019,” Eagar said. “And two, the unemployment rate has been extremely volatile. We've observed large month-to-month swings in the unemployment rate, largely due to the COVID-19 restrictions.”
Mayor Ken Miyagishima says he is hopeful workforce recovery will continue, emphasizing the resiliency of businesses during the pandemic.
“We're at 94% of where we were in January of 2020, and 95.3% of where we were in the same time of January 2019,” Miyagishima said. “So that actually shows you the resiliency of the workforce in the city and the businesses.”
Councilor Gabe Vasquez pointed to the city’s construction boom as a sign of economic growth. He says that Las Cruces is an ideal location for those looking to lower their cost of living.
“I know that sometimes when the economy gets bad people move to places where it's cheaper to live,” Vasquez said. “They want to get rid of some of their excess financial obligations or lower their cost of living, and so we end up being a very attractive choice for retirees here in Las Cruces to come and perhaps buy a bigger home or just you know, to retire just in general.”
Over the last two years, the median residential listing price in Las Cruces has risen from $212,000 to $242,000. When asked by Councilor Vasquez about the ability of local buyers to afford homes in the city, Las Cruces Community Development Director Larry Nichols highlighted low interest rates.
“We've tracked that very closely here in this last year, in particular, because we had a situation where the construction activity was very aggressive and improving. We built more houses here, single-family dwellings, last year during the COVID pandemic than we have in about 14 years, 15 years,” Nichols said. “The reason for being able to qualify to buy a home is that the interest rate has been as low for mortgages as it has been for a number of years. So, they're able to qualify now, where in the past that has been a challenge.”
The Las Cruces City Council will continue to receive economic updates on a quarterly basis.