New Mexico is short on jobs. One way it’s trying to address that is attracting companies to the state. Sometimes that means giving them financial incentives to move or expand here. That’s part of how New Mexico swayed Stampede Meat - a meat processing and production company - to open a new plant here.
It’s a dusty Wednesday night. Dozens of job seekers show up at a community center in Chaparral. They’re here to learn more about Stampede Meat, an Illinois-based company that’s expanding to Sunland Park and offering hundreds of jobs.
Julia Brown is city manager of Sunland Park. She stands in front of a projector screen, with the Stampede website pulled up behind her; there’s a giant picture of generously seasoned chicken wings. Brown describes the company, the job openings, and the application process.
“We are doing outreach to make sure that residents of Doña Ana County have information about these jobs,” Brown says. “We really want to get as many of these jobs as possible for New Mexico residents, so that they have an opportunity to participate in the upside of this development.”
Brown says Stampede is a big get for New Mexico. When the company announced it was looking to expand, Idaho, Oklahoma and Texas also threw their hats in the ring. But the Land of Enchantment made a strong case -and offered a financial incentive: up to $3 million.
“We were able to get into the thick of the race,” says Matt Geisel, Cabinet Secretary of New Mexico’s Economic Development Department.
That three million comes from what’s known as the Local Economic Development Act, or LEDA.
“It is a discretionary closing fund to help bridge the gap .n supporting the recruitment of companies and the expansion of existing companies in the state,” Geisel says.
In other words, it’s a financial incentive program to woo out-of-state companies and help in-state companies expand. It’s funded by taxpayers.
Stampede pledged $36 million to renovate and reopen the old Tyson Foods plant that shut down several years ago. New Mexico will throw in up to $3 million, doled out over several years, if Stampede meets specific job targets. If all goes as planned, the company will ultimately create nearly 1,300 new jobs.
As of January, Geisel says, about 5,400 people in the Las Cruces Metro Area were unemployed. “A thousand plus jobs on 5,400, that’s a big dent in that number,” Geisel says.
Maria Eva Villalon hopes she lands a job at the plant. She read about Stampede in the newspaper and came out to the community meeting in Chaparral.
Villalon’s currently unemployed but says she used to work for a similar company in Chicago, where she did everything from packing to trimming and boning. “The only thing I don’t really like is it is cold,” she says. “These companies are pretty cold.”
Villalon says everything about Stampede interests her. “Especially the money, you know,” she says.
But it’s not clear yet exactly how much money employees will receive. Wages start at $9.25 an hour and go up to $25, depending on skill level and experience.
So how many of these jobs will pay on the lower or higher end of the scale? That’s up to Stampede Meat. The LEDA agreement maps out how many jobs the company has to create. But it doesn’t say anything about a median wage.
Chris Erickson is an economist at New Mexico State University. “So particularly when we’re giving them a subsidy, you would expect that we would have some sort of guarantee that it would generate jobs that at least exceed minimum wage by a substantial amount,” he says. “It’s very common for these kind of agreements to have a requirement that...the average salary paid or the median salary paid is at a reasonable level.”
$9.25 is higher than the minimum wage in Sunland Park, which is $7.50 an hour. But it’s lower than the new minimum in Las Cruces, which takes effect in January. That’s $10.10 an hour.
And according to MIT’s Living Wage Calculator, single adults in Doña Ana County actually have to earn $10.45 an hour to meet their basic needs.
It’s entirely possible Stampede will pay all its new hires $10.45 and above. But that’s not because the state is enforcing, as Erickson puts it, a reasonable median salary.
Matt Geisel, with the Economic Development Department, says some LEDA agreements do have median wage requirements. “It depends on the nature of the overall project and the overall investment,” he says. “Say if you had a situation where the capital investment was low and the primary economic benefit was gonna be high wage jobs.”
In that case, he says, the state might include a salary requirement.
“I think in the case of Stampede they’re making significant commitments in capital investment and job creation and they’re committed to being a quality employer in New Mexico,” Geisel says. “Let’s make no bones about it, in this scenario a chunk of this is a quantity of jobs.”
Back at the community meeting, City Manager Julia Brown says it’s not just about the number of jobs; it’s also about the opportunity to move up in the company.
“One of the things the company has told us is they have a philosophy of promoting from within,” she says. She’s hopeful the company won’t just provide jobs, but will also provide opportunities for growth.
