Guest blog post by Matt Erskine, Acting Assistant Secretary of Commerce for Economic Development
Last spring, I visited one of the premier technology parks in the southwest, the Sandia Science and Technology Park (SSTP) in Albuquerque, New Mexico. Over the past five years, the Economic Development Administration (EDA) has invested $1.8 million in this industrial park, funding infrastructure improvements such as new, high-speed fiber optic lines that help the businesses located there leverage advances in technology that have been generated by nearby universities and federal labs.
With the recent release of a report by the Mid-Region Council of Governments, we have learned what a smart investment that turned out to be. According to the authors, the $1.8 billion in economic activity generated by Sandia since it was established in 1998 has brought more than $73 million in tax revenue for the state of New Mexico and $10.4 million for the city of Albuquerque.
The effects on employment in the region are even more impressive. In addition to being responsible for nearly 2,500 direct jobs, the report found that SSTP generated more than 4,100 indirect jobs—meaning that for every job at the technology park, an additional 1.7 jobs were created in the region. Combined, these direct and indirect jobs generated $3.06 billion in wages. Average salaries at SSTP—estimated to be $73,728 in 2011—significantly exceed the average for the Albuquerque metropolitan area, which was $42,332.
This is all great news for the Albuquerque area. But it is also a lesson for any region seeking to catalyze business development and job growth in growing, tech-focused industries.
Public investment by government in infrastructure is a critical element of any effort to ensure prosperity and economic growth. By providing essential services that businesses need—such as roads and other transportation infrastructure, water and sewer services, communications and information technology services—we aid the growth of new and expanding businesses. The result will be new jobs, increases in productivity, growth in profits, and—as we see in Sandia, New Mexico—a spill-over effect over a wide geographic area.
This was behind President Obama’s announcement last year directing federal agencies to focus on high-impact, job-creating infrastructure projects: “Creating jobs is my highest priority as president, and investing in our nation’s infrastructure can help create those jobs and grow our economy.”
The Sandia Science and Technology Park has benefitted over the years from such public investment. In addition to EDA’s contribution, support came from a variety of partners, including Sandia National Laboratories, the state of New Mexico, the city of Albuquerque, and many other entities. With the results tallied in this new report, SSTP is clearly an excellent example of how public-private partnerships can succeed in catalyzing investment and creating jobs.