Giant sucking sound is college grads leaving NM
‘Best and brightest’ desert city for greener pastures in nearby states
Shades of Ross Perot; what is causing that giant sucking sound heard around Albuquerque? Is it jobs heading to Mexico as Perot predicted NAFTA would cause? No, these sounds are coming from the north, east and west, not the south! It is college graduates deserting New Mexico for neighboring cities to find employment! This brain-drain will have profound longterm consequences similar to those in Appalachia.
Texas, Colorado, Utah and Arizona are creating jobs because they have cities with booming economic ecosystems. The “best and brightest” from states with stagnant economies, e.g., New Mexico, provide employees for these economic ecosystems. Left behind are problems Pollyanna locals either deny or blame on K-12 education: unemployment, drug addiction, crime, declining tax base, declining university enrollment, etc.
The Milken Institute annually rates the top USA 200 large cities based on economic outcomes. Milken’s rating criteria are weighted and based on prior year and short-term averaged data: (1) job growth, 42.9 percent, (2) wage and salary growth, 28.6 percent, and (3) four high-tech criteria, 28.5 percent. Milken’s 2017 report, the source of the data in this column, is available online.
The large cities/metro areas rated the highest in Milken’s 2017 report are: 1. Provo-Orem, Utah; 2. Raleigh, NC; 3. Dallas-Plano-Irving, Texas; 4. San Francisco-Redwood City-South San Francisco, Calif.; 5. Fort Collins, Colo.; 6. North Port-Sarasota-Bradenton, Fla.; 7. Orlando-Kissimmee-Sanford, Fla.; 8. Nashville-Davidson-Murfreesboro-Franklin, Tenn.; 9. Austin-Round Rock, Texas; and 10. Salt Lake City, Utah.
Despite high rankings in two of the four high-tech criteria, low rankings in job and salary growth resulted in Albuquerque ranking 160.
The top metros, e.g., Provo-Orem, offer important lessons that are helpful to metros like Albuquerque.
Technology innovation has been a major driver of economic growth in the ProvoOrem metro area, which ranked third among large metros for high-tech growth. Its professional, scientific, and technical services sector added 5,500 positions between 2011 and 2016. These additions to the economy created jobs through the multiplier effect in services and construction that are several times the technical jobs.
Brigham Young University ranked fourth on the Milken Institute’s best universities for technology transfer — University of Utah is first — largely due to creating startup firms with high-growth potential. BYU fosters an entrepreneurial mind-set, offers incentives for faculty to commercialize research and supports student ventures through the Rollins Center for Entrepreneurship and Technology. As a result, BYU faculty and graduates have started many companies, but five have grown to unicorn status with an evaluation of $1 billion or more. Two BYU-founded companies are:
Entrata, which originally won a student business plan competition at BYU, is now based in Lehi and provides a platform for landlords to better manage their properties and allow tenants to pay their rent online.
Qualtrics, a firm focused on automating statistical data analysis, was founded 15 years ago by a BYU professor and his son. It has 1,300 employees.
Most of the unicorns created around the world in the last couple of years provide technical services emphasizing applications of artificial intelligence and data mining.
Graduates and faculty of New Mexico universities have created no unicorns located in New Mexico! Jeff Bezos, a University of Albuquerque and Princeton graduate, started Amazon in Seattle. Microsoft was founded in Albuquerque but moved to Seattle. One of the world’s first personal computers was invented and built in Albuquerque. Albuquerque has a rich history of innovators who left.
No unicorns are traceable to DOE’s 17 national laboratories, including Sandia and Los Alamos, despite many R&D100 awards, highly-educated technical staff and their management model: government-owned, contractor-operated. Bureaucratic, low-risk cultures that value scientific recognition and academic advancements over economic outcomes clash with entrepreneurship.
Examining the success of Provo and BYU and comparing these to the economic outcomes of local public university and government-owned research institutions suggests NM residents should substantially raise accountability for NM’s economic and political leaders, university administrators and government laboratory executives.