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New Mexico analysis makes the business case for racial equity in new report released by W.K. Kellogg Foundation and Altarum

Rebecca Noricks or Kathy Reincke
Tel: 269.969.2079
rebecca.noricks@wkkf.org or kar@wkkf.org

(BATTLE CREEK, MICH.)  – A study released today by the W.K. Kellogg Foundation (WKKF) and Altarum concludes that New Mexico’s future economic growth is linked to a healthier, better educated, more skilled and diverse workforce. “The Business Case for Racial Equity New Mexico: A Strategy for Growth” analysis also finds the state can realize a $93 billion gain in economic output by 2050 if racial disparities in health, education, incarceration and employment are eliminated.

“There is tremendous economic potential for the people of New Mexico and their communities,” says La June Montgomery Tabron, WKKF’s president and CEO. “With one of the most diverse and multilingual populations in the country, this report demonstrates how opportunistic it is for business leaders and policymakers to invest in the talents of the future workforce and remove barriers so that all families and their children have opportunities to thrive.”

This report complements a study called “An Equity Profile of Albuquerque” released June 19 by the W.K. Kellogg Foundation, PolicyLink and the USC Program for Environmental and Regional Equity. It found that the Albuquerque region’s economy could have been nearly $11 billion stronger in 2014 if its racial gaps in income had been closed. The inequity means lower wages, less education, longer commutes, increased segregation, higher exposure rates to air pollution, less access to healthy food and higher rates of obesity, diabetes and asthma. W.K. Kellogg Foundation

Looking to the future, the Business Case for Racial Equity report provides a blueprint for achieving racial equity and sustaining economic growth, with a focus on preparing the workforce for the quality jobs of tomorrow that will be on military bases and in technology labs, oil and gas production, agriculture and tourism.

Among the findings are that 63 percent of the jobs in the state will demand post-secondary education by 2020, but only 47 percent of Native Americans and 52 percent of Hispanics have achieved some post-secondary education, compared to 75 percent of Whites.  Similarly, 27 percent of the 2020 jobs will require at least a bachelor’s degree, but only 14 percent of Hispanics, and 10 percent of Native Americans hold college degrees. Currently, 62 percent of the working age population (ages 18 to 64) are people of color, increasing to more than 75 percent by 2050.    

“These findings identify so many areas of opportunity for our businesses, communities and state,” says Frank R. López, WKKF’s director of New Mexico programs. “Advancing racial equity isn’t only about social justice. It’s a strategy for economic growth. We look forward to collaborating with community members and leaders to take action and create wins for all the people who call New Mexico home.”

The average Hispanic adult earns just more than half of their White age/gender counterpart (59 percent), and the average Native American earns less than half (46 percent). It equates to roughly $39,000 in average annual earnings for Whites, $23,000 for Hispanics, and $18,000 for Native Americans. But closing the earnings gap today would create $10 billion in additional consumer spending, including $1.3 billion in food purchases per year, $3.3 billion in housing, $347 million in apparel and services, $1.7 billion in automobiles and transportation, and $513 million in entertainment spending today.

“It’s imperative that a collaborative effort from all sectors commit to investing in the skills and development of all workers,” Tabron says, noting that overcoming income inequities would be a major boost to the state’s economy.

Ani Turner, co-director of Sustainable Health Spending Strategies at Altarum, led the research for the study, analyzing data from public and private sources, including the U.S. Census, Johns Hopkins University, Georgetown University, Brandeis University and Harvard University. Local partners in New Mexico also contributed to the report. Their methodology included applying established models to estimate the economic impact of the disparities faced by people of color. A national “Business Case for Racial Equity” was released in April. “To remain competitive in a global economy, we need the full creative and economic potential of all our people,” says Turner.  “Greater racial equity will not only improve individual lives, it will increase the size of the economic pie for everyone.”

The Business Case for Racial Equity New Mexico: A Strategy for Growth” blends data with promising strategies for building equitable communities, noting that:

  • Long-term evaluations of high-quality early childhood interventions have demonstrated meaningful impacts on educational performance and other outcomes, providing benefits that accumulate over lifetimes. The New Mexico PreK is a state-funded voluntary program for 3 and 4-year-olds aimed at increasing school readiness. Evaluations have consistently found positive impacts on vocabulary, math, and literacy scores. But an estimated 35,000 children under age 5 are not attending preschool in New Mexico, so there is potential to expand these gains.
  • Only 31 percent of state-funded financial aid is need-based in New Mexico, compared to the national average of 76 percent and rates of up to 100 percent in neighboring states like Texas, Arizona and Colorado. The Legislative Lottery Scholarship, a merit-based scholarship covering a portion of tuition at New Mexico colleges and universities could become more need-based. The College Affordability Fund endowment could be restructured to support low-income students and students of color looking to increase their workforce readiness through post-secondary credentials.
  • Businesses can play a role in reducing the impact of mass incarceration by pursuing policies that offer opportunity to returning community members. For example, “ban the box” policies remove the question on conviction history from initial job applications so that jobseekers re-entering society have the opportunity to be considered for employment. The Equal Employment Opportunity Commission offers guidance on best practices for using arrest and conviction information in hiring decisions.

Additional next steps to take concrete action are listed on pages 34-35 of the report.

Access the full report at http://www.businesscaseforracialequity.org.

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About the W.K. Kellogg Foundation
The W.K. Kellogg Foundation (WKKF), founded in 1930 as an independent, private foundation by breakfast cereal pioneer, Will Keith Kellogg, is among the largest philanthropic foundations in the United States. Guided by the belief that all children should have an equal opportunity to thrive, WKKF works with communities to create conditions for vulnerable children so they can realize their full potential in school, work and life. The Kellogg Foundation is based in Battle Creek, Michigan, and works throughout the United States and internationally, as well as with sovereign tribes. Special emphasis is paid to priority places where there are high concentrations of poverty and where children face significant barriers to success. WKKF priority places in the U.S. are in Michigan, Mississippi, New Mexico and New Orleans; and internationally, are in Mexico and Haiti.   

About Altarum
Altarum is a nonprofit organization dedicated to transforming health and health care through ideas and action that increase value and affordability, access, and equity of care. It drives change through strategies in patient and provider incentives, population health and practice transformation. Altarum headquarters are in Ann Arbor, Michigan, with locations in Washington, D.C., and Portland, Maine. Altarum has two wholly-owned subsidiaries: KAI Research, a contract research organization and health research company based in Rockville, Maryland, and Palladian Partners, a full-service health communications firm in Silver Spring, Maryland. Learn more at altarum.org.

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