Source: US International Trade Administration
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Melinda Allen is an Interim President for New Mexico Partnership.
New Mexico has one of the best track records in the United States when it comes to cultivating innovation. New Mexico has seen everything from the invention of nanotechnology at Los Alamos National Labs in 1972, to the first nicotine patch being developed at NM Tech in the early 1980s, to Virgin Galactic’s work to produce commercial spaceflights. This history of innovation and a world-class manufacturing environment has positioned the state to benefit from a newly emerging trend.
The economic ripple effects of COVID-19 are creating a global shift for supply chain and manufacturing companies, opening new pathways to re-shore and near-shore Asia-based manufacturing, a strategy that could provide cost efficiencies and quicker inventory turnaround for businesses.
The New Mexico Partnership, the organization tasked by the state with business recruitment, is actively pursuing Asia-based operations that have the potential of scaling up its production and supply chain operations within the United States. This effort is primarily focusing on China, Korea, Japan and Taiwan. This approach has received a warm reception from companies that are looking for ways to overcome operational challenges highlighted by COVID-19.
Promoting the state’s successes in the technology and advanced manufacturing industries, the New Mexico Partnership is quick to showcase the $6.5 billion in research and development which is largely fueled by the state’s two national laboratories (Sandia and Los Alamos), the Air Force Research Laboratory, and three research universities. Another highlight is the state’s success in manufacturing and leading the nation in global export growth in 2019. Manufacturers like Intel, Admiral Cable, and Raytheon, all of which have established facilities within the state, are all key players in the growth of these industries.
New Mexico’s workforce incentives have also received a lot of interest helping to put the state at the front of the pack. The three most popular programs include:
- Job Training and Incentive Program (JTIP) – The Flagship New Mexico Job Training Incentive Program (JTIP) funds on-the-job and classroom training for newly-created jobs in expanding or relocating businesses by reimbursing employers for 50-75% of employee wages for up to 6 months.
- Local Economic Development Act (LEDA) – LEDA is a discretionary, cash-grant incentive program that can be used towards reimbursing the costs associated with land, building and infrastructure improvements. Funding awards are determined on a project-by-project basis.
- High Wage Job Tax Credit (HWJTC) – Employers are eligible to receive a tax credit for each new high-wage economic-base job (paying over $40,000 in a rural area or $60,000 in a metro). The credit equals 8.5% of the wages and benefits paid for each such job created. Credits in excess of tax liability can be refunded to the employer as cash.
Our cost of doing business, these incentives, and more, can help companies relocating to New Mexico save 15-30 percent on operating costs, relative to other regions in the United States in which many companies are concentrated.
More information about all that New Mexico has to offer and the New Mexico Partnership can be found at nmpartnership.com.