Workforce development is a key ingredient in spurring local economic development and training the next generation of talent. Senator Martin Heinrich (D-N.M.), Ranking Member of the Joint Economic Committee, recently hosted a series of roundtables in New Mexico to hear more about challenges small business owners face when working to retain talent, build a skilled workforce, and foster leadership skills.
These conversations help build on findings in a recent Joint Economic Committee Report, Investing in Rural America, that outlined some of the challenges rural small businesses face. Insights collected from roundtables shine a light on how national policy issues are felt at a local level and how a skilled workforce is central to the success of both new and mature small businesses. Policy makers can use the experiences of New Mexico community members to identify barriers to locating skilled workers and to deliver targeted solutions to high-need communities.
Brain Drain Continues to Hamper Growth
Brain drain is a well-documented trend across rural communities. From 2010 to 2016, two-thirds of rural counties experienced population decline. Such declines drain rural and small-town communities of precious human capital, stifling their ability to find skilled employees and jumpstart entrepreneurship.
In New Mexico, students often leave for out-of-state employment opportunities with more competitive benefits. In Las Vegas, New Mexico, for example, small businesses owners communicated that attracting recent college graduates and locating specialized talent is a struggle. Many graduates are discouraged from staying in rural communities because of stark economic realities. In nearby Mora, for instance, there are no local grocery stores, posing a significant challenge for families that wish to settle down.
These struggles are compounded by an aging population: San Miguel County, which includes Las Vegas, is slowly “graying” with an increasingly elderly population. This “silver tsunami” is a major issue in larger cities, such as Albuquerque, as well: as workers retire, small businesses are faced with employee shortages and often spend months trying to secure skilled workers.
Even booming cities have their workforce challenges. Carlsbad, for instance, is located in a county with an unemployment rate of less than 4 percent, mostly due to an uptick in local oil production. However, many expect the boom to be temporary and small businesses report severe shortages in several industries, including retail, medical services, and education. Clouding this outlook are high local housing prices, which discourage workers from settling down and taking on permanent positions. To combat these barriers, city officials are working to provide affordable housing for employees looking to make long-term investments in property.
Small business roundtable in Albuquerque, New Mexico
Mentorship and Leadership Development Drive Industry
Time and time again, New Mexico small business owners reiterated the importance of entrepreneurial mentorship in rural communities. Young, creative workers often leave home because of weak local business networks that limit opportunities for personal growth. Culturally competent mentorship and leadership development can help both retain an educated workforce and improve the career readiness of those entering the job market.
On the retention front, several small businesses are working to perform better on-the-job training and mentorship. In Silver City, New Mexico, a local tile manufacturer spoke to the need for “succession planning” for rural small businesses that lack a leadership pipeline in the face of imminent retirements. Such planning is time-intensive but helps ensure that family businesses do not disappear after founders retire and incentivizes employees to stay and grow. Fostering this “mentorship attitude” in rural communities is vital.
To enhance career readiness, mentorship and leadership development should include an emphasis on teaching interpersonal skills. In Deming, New Mexico, small business community leaders shared stories about how job seekers lacked basic behavioral and office skills, such as punctuality, customer service skills, and interview etiquette.
Several local organizations in New Mexico are working to boost career readiness. The Albuquerque Hispano Chamber of Commerce, for example, helps unemployed community members build basic interpersonal skills and offers customized training opportunities. Critically, the center’s programs are culturally competent to accommodate individuals across many socio-economic and cultural backgrounds. The chamber also integrates peer-to-peer mentorship, which can be less intimidating for students and young workers, into its programming.
Federal Mentorship Programs a Good Start
Federal programs that formalize mentorship are a strong starting point to expand skills training and development. Through these programs, established companies can instill confidence and expertise in new businesses opening their doors for the first time.
At a roundtable at the Indian Pueblo Cultural Center in Albuquerque, Native American small business owners highlighted the Small Business Administration’s (SBA) mentor-protégé program. The program pairs small businesses looking to enter the federal contracting space with experienced government contractors. Another tried-and-tested model is SCORE, a nonprofit association of volunteer business counselors supported by the SBA. At the Albuquerque Veterans Business Outreach Center (VBOC), local staff underlined that many veterans take advantage of the association’s volunteers, who assist and mentor first-time entrepreneurs.
Looking Ahead
Investing in Rural America examined how rural communities face unique labor force challenges, including aging demographics, the changing rural employment landscape, and lingering economic pain from the last recession. Conversations with small businesses revealed that targeted federal investments can help address these challenges.
Going forward, Congress should continue to encourage policies that curb brain drain and facilitate networking and mentorship to accelerate rural development in high-growth sectors like health care and education. Senator Heinrich has introduced legislation, including the CHANCE in Tech Act, that aims to make it easier for workers to gain the skills and confidence they need to be employable in a wide variety of roles.
Congress should also build on current models — including SCORE and mentor-protégé programs — that leverage private-sector expertise to boost entrepreneurship. These models, complemented by culturally competent skills training, have made a big difference in New Mexico and can make an even bigger impact with strong backing from Congress.
