Farmington job market faces continued challenges as high unemployment lingers

San Juan College official points to lack of qualified workers as big issue

Farmington Daily Times

In April 2020, joblessness in the Farmington area peaked at 13.3%.
The unemployment rate now is less than half of what it was then.
But it is the highest of the state's four MSAs and remains well above the national rate.

FARMINGTON — The unemployment rate in the Farmington metropolitan statistical area has declined significantly over the past several months, tumbling from 9.3% in July to 6.3% in November.

But it stubbornly remains the highest of the state's four MSAs, running well in excess of those of the Albuquerque, Santa Fe and Las Cruces areas, as well as the national rate.

Against that backdrop, a casual observer might conclude that jobs are scarce in San Juan County. But a perusal of help wanted sites or even a quick drive through Farmington's commercial districts exposes the fallacy of that notion, as many businesses seem to be pleading for workers and receiving little in the way of response.

How to explain that apparent contradiction?

Lorenzo Reyes, the associate vice president for workforce, economic and resource development at San Juan College, noted that in November, there were 2,200 listed job openings in the Farmington MSA while approximately 3,000 people in the area were receiving unemployment benefits or were in the labor market pool.

Under normal circumstances, he said, those kinds of figures would result in a rapid shrinking of the unemployment rate as those people looking for work were matched with those openings. But these are not normal circumstances, he said, describing how the labor market across America and San Juan County has changed rapidly in the wake of the COVID-19 pandemic.

"This scenario is a little bit different now than we've ever had before," he said. "We will continue to see a decline in the unemployment rate, but we have many challenges facing employers, as well as workers."

Reyes said the Farmington area's jobless rate of 6.3% in November, the most recent period for which figures were available, is a considerable improvement from the unemployment rate it posted in the immediate aftermath of the beginning of the pandemic. In April 2020, joblessness peaked at 13.3%, so the unemployment rate is less than half of what it was then.

But Reyes said the county can, and should, do better.

"That's still not where we want to be as an economy – 3% to 4% is the number we are looking for," he said.

A misalignment in the job market

Getting there won't be easy, Reyes said. He said San Juan County is suffering from a misalignment between the jobs that are available and the jobs local workers are qualified to perform.

"What that indicates is you have the jobs (available), but employers are not having the applicants (they need) because people do not have the skills needed for those positions," he said.

Reyes said that of the job openings listed in the Farmington MSA in November, only 13% required an education level of a high school diploma or less. Nearly 87% of them required one year of college or more.

Those jobs were clustered mostly in the fields of health care, information technology, education, retail, administrative services, food services and transportation.

"There are openings across all of those industry sectors," he said. "And some of them require very specialized skills or certificates."

Other factors are at play in San Juan County, as well, he said. On Jan. 1, the minimum wage in New Mexico increased to $11.50 an hour, adding to labor costs for business owners. And Reyes said even though San Juan County is a long way from the East Coast or West Coast, where the phenomenon has received so much attention, the impact of the so-called "Great Resignation" has been felt here.

"I'm not really worried about the impact on employees," Reyes said about the minimum wage increase. "But it's going to continue to be a struggle for employers to find qualified applicants. The bigger concern is retention (of employees). I think a lot of employers are losing qualified employees and struggling to retain their workforce."

Reyes pointed to U.S. Department of Labor statistics for November that revealed a record-setting number of workers voluntarily had left their job. He said most of them are doing so because they believe they will have little or no trouble finding another one.

Jamie Church, president and CEO of the Farmington Chamber of Commerce.

Jamie Church, the president and CEO of the Farmington Chamber of Commerce, said she believes the continued presence of the virus is having a big impact on the apparent unwillingness of so many people to delay their return to the work force. She worries that another potential surge in COVID-19 cases in the county because of the Omicron variant will make matters worse. But she said she had begun to get the impression in recent weeks that the labor crunch the area was experiencing had begun to subside.

"I haven't heard as many Farmington chamber members say they were not able to find help, so maybe they've adjusted," she said.

Church said a larger issue for many employers has been the inability of so many workers to do their job as the virus continues to rage through the community. She said that was not a big concern for large companies, but for mom-and-pop operators who have just a handful of workers, having two or three employees out sick for a week can mean having to close temporarily.

"It's tough if everybody has COVID," she said.

Getting the upper hand

Reyes said another element contributing to the lack of qualified workers in San Juan County is the overall shrinkage of the workforce. Before the pandemic, he said, the workforce consistently was made up of more than 50,000 people. Now, he said, that number is closer to 49,000 because so many families have relocated.

"That's a significant (reduction) in a population like ours," he said.

Reyes recommended that companies act proactively to retain their work force rather than focus their efforts on finding replacements. He said companies that offer flexible scheduling, opportunities for additional training that can lead to advancement, free tuition programs, better medical benefits and, of course, higher salaries are the ones that are likely to be more successful at avoiding turnover.

"That's going to require a little bit of a shift from the traditional employer model," he said.

San Juan College has a big role to play in addressing the shortage of qualified workers in the county, he said. The institution offers a wide variety of degree and certification programs that are tailored to meet the needs of the local job market, and Reyes said he is happy to advise companies on what they need to do to attract qualified workers and keep them.

But he acknowledged that guidance is not always greeted with enthusiasm by employers who long have been accustomed to having the upper hand on workers.

"Some of the employers are very receptive," he said. "In fact, I'm in the process of putting together proposals for a couple of companies for building a workforce. Others are saying, 'Let's wait, I think I can retain my current workforce.' But that's not happening."

Despite her concerns, Church said she is choosing to take a positive approach to the next several months, explaining that she thinks many local business owners have adopted a grind-it-out approach to dealing with all those issues and are doing what they always do when faced with such challenges — make adjustments.

"I have more of a sense of optimism as we head into 2022," she said. "We're learning how to live with the virus and work with it. This isn't new to us anymore."

Mike Easterling can be reached at 505-564-4610 or measterling@daily-times.com. Support local journalism with a digital subscription.