So where do things stand with manufacturing in Santa Fe and New Mexico?
Same as ever: Small.
That describes Marty’s Meals, which founder and owner Sandy Bosben launched in her kitchen in 2010. She tapped into local financing resources to parlay her pet food production operation into today’s 8,000-square-foot manufacturing and retail facility on Cordova Road, a few doors down from Trader Joe’s.
With 11 employees, she produces about 3,500 to 4,000 pounds of certified organic, GMO-free dog and cat food a week.
But as much as Marty’s Meals thrives and grows — online sales should start sometime in November — the local and statewide manufacturing picture remains largely unchanged from years past.
In other words, there are a lot more Marty’s Meals than there are, say, Intels.
And with statewide manufacturing sitting at 3.3 percent of total employment, or 27,375 employees, in contrast to the national average of 9 percent, some lament the state’s inability to get closer to to the rest of the country in terms of producing goods.
New Mexico is one of three states to get an F grade on the Manufacturing Scorecard 2019 issued by Ball State University’s Center for Business Economic Research. The survey scored overall manufacturing industry health and measures the total income earnings of manufacturing employees, the wage premium paid to manufacturing employees over other employees and the per capita share of manufacturing employees.
The same report gave New Mexico F grades in other categories, including human capital and global reach. The state received a D for diversification and expected fiscal liability gaps via government bonds. It fared better with C grades in worker benefit costs and productivity and innovation, and a B grade for tax climate.
“The state continues to get an ‘F’ in the manufacturing, logistics, global position categories, simply because you have very little economic activity in manufacturing or logistics, relative to other states,” said Michael J. Hicks, whose group in Indiana issued the scorecard. “The big problem is human capital. States with low human capital usually have broadly low levels of educational attainment, and schools that do not develop skills for attending college or other postsecondary education. This is a disincentive to expansion or relocation of manufacturing.”
In Santa Fe, 841 people work in manufacturing — comprising just 1.4 percent of the workforce, according to New Mexico Department Workforce Solutions statistics. Bernalillo County is at 3.8 percent, Chaves County 3.9 percent and San Juan County 2.7 percent. Sandoval County — home of Intel, the multinational tech giant — checks in at 8.6 percent.
The average number of employees at a New Mexico manufacturing firm is 15.4, while Santa Fe’s average is 5.3, Workforce Solutions statistics show.
Manufacturing numbers are important because such jobs typically have higher average wages than the overall workforce. New Mexico’s weekly wage averages $1,085 in manufacturing and $890 overall. But the mom-and-pop business size in Santa Fe leads to a lower average weekly wage for manufacturing employees at $705 than the overall average wage of $833, Workforce Solutions reported.
New Mexico Manufacturing Extension Partnership CEO Jennifer Sinsabaugh counters the findings of the Workforce Solutions statistics and Ball State scorecard. “The scorecard focuses on other states’ strengths and neglects New Mexico’s strengths: Ingenuity, creativity, innovation and the ability to get things made in a unique fashion,” Sinsabaugh said.
She added the Workforce Solutions numbers are lower than the true manufacturing numbers because some businesses — like some breweries — don’t classify themselves as manufacturers. She believes Santa Fe has closer to 2,500 manufacturing employees and New Mexico about 40,000.
But Sinsabaugh acknowledged New Mexico predominantly has small manufacturers with 97 percent having fewer than 100 employees. The vast majority of manufacturing in the state is done between Los Alamos and Los Lunas and is somehow related to Los Alamos and Sandia national laboratories.
“Workforce is the No. 1 challenge,” she said of the manufacturing picture. “We have a lack of skilled workforce tailored for manufacturing. We are fairly space constrained as far as ready-to-go facilities [for manufacturers to move into].
“Santa Fe is land constrained by prices. Albuquerque is constrained by location [surrounded by mountains and Native American reservations]. There isn’t a ton of land available.”
New Mexico’s manufacturing partnership, which gets funding from National Institute of Standards and Technology’s Manufacturing Extension Partnership and from fees for services provided, provides technical assistance and works to remove barriers to growth for manufacturers.
The organization stretched National Manufacturing Day on Oct. 4 across the month of October with more than 30 events, including tours of manufacturers and visits to schools to tout the career opportunities in manufacturing.
“We realize there is huge gap in awareness of what manufacturing is and what it can do for the state,” Sinsabaugh said. “It doesn’t have to be dirty stereotypes that it used to be.”
If Santa Fe has its foot in the manufacturing door, it’s probably in the food industry, said Rich Brown, the city’s economic development director.
Brown staged an event last week at the Santa Fe Community Convention Center to inspire, support and increase entrepreneurship in Santa Fe’s food and food-related industries. “We need to accelerate the food business,” Brown said. “We want them to scale up regionally and nationally. Our dream for the future is we want to create a manufacturing hub at the airport focusing on food industry.”
Some already are on board.
Art of Chocolate Cacao Santa Fe co-owner Derek Lanter doesn’t classify himself as a manufacturer, but he, co-owner Melanie Boudar and pastry chef Mark Sciscenti have a cafe/manufacturing warehouse on Richards Lane, where cacao beans are roasted, winnowed, ground into a paste and crafted into truffles, ganaches, bars and elixirs.
The business opened in 2016 in a 3,000-square-foot warehouse after business partners Lanter and Boudar both moved to Santa Fe from Hawaii. Art of Chocolate has six employees, including the owners.
Ninety percent of Art of Chocolate sales are straight to customers at their cafe. They supply chocolate to about a dozen local businesses.
Lanter has a little online sales that he wants to be more robust, but shipping costs can be more than the chocolate themselves.
He said industry associations in other states have discounted rates with shippers but he has found no such arrangement in New Mexico.
“The cost of shipping out of here is very high,” Lanter said. “If you are going to ship it out, forget it.”
But he has no regrets about setting up shop in Santa Fe. “If you are going to live and work somewhere, you want to be in a place you want to be,” Lanter said. “People here have good taste.”