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New Mexico invests in young entrepreneurs to kickstart its sluggish economy

While much of the U.S. economy is on the rebound, New Mexico remains in the dumps since the recession hit a decade ago. Part of the problem may be a statewide brain drain: educated young people taking their careers -- and expertise -- elsewhere. Economics correspondent Paul Solman reports on New Mexico’s mission to bring back its young, energetic entrepreneurs.

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  • Judy Woodruff:

    The stock market is up, unemployment is down, and much of the U.S. economy is on the rebound, but not for the state of New Mexico.

    It's a place that's still down in the dumps a decade after the recession began. Its jobless rate is 6 percent, compared to just 4.1 percent nationally.

    Economics correspondent Paul Solman traveled to the Land of Enchantment, where local officials are betting on innovation to spark the turnaround.

    It's part of his weekly series, Making Sense.

  • Paul Solman:

    Now, here's a kind of weird question- Can a hot new photography fad, smoke bomb Web sites, help reignite one of the country's worst performing economies?

  • Kyle Guin:

    There is no good supplier for these smoke bombs.

  • Paul Solman:

    University of New Mexico junior Kyle Guin hopes to build a smoke bomb supply business right here in New Mexico.

  • Kyle Guin:

    I found a great manufacturer and distributor. And I'm currently working with Amazon fulfillment centers to be one of the only sellers in the U.S. that can have these to your door in two days with Prime shipping.

  • Paul Solman:

    You will hear from the out-of-the-box entrepreneur who showed off a homegrown snowboard to Richard Berry, when we interviewed him just finishing eight years as mayor of Albuquerque. And hey, says Berry, these days, the mantra everywhere is young entrepreneurs or bust.

  • Richard Berry:

    Every mayor in the country is worried about why people, young people are moving. Shame on us as a state for 40 years to rely on just government and oil and gas, but now we have this third leg of the economy that's starting to take off.

  • Paul Solman:

    Starting to take off, he hopes, in the Albuquerque metro area, which houses half the state's two million people. It sure would help New Mexico, whose economy is now ranked a moribund 47th in the nation, with an unemployment rate topped only by Alaska's.

    A cause and effect of the malaise, New Mexico's young brains draining away to more promising and populous markets. But there's plenty to like about the Land of Enchantment, says the outgoing mayor.

  • Richard Berry:

    Obviously, great weather. Mountains. You can ski in the morning, golf in the afternoon, the weather, the landscape, the special size of the places there.

  • Paul Solman:

    But if you're a would-be entrepreneur, you can also work here on the cheap, a low burn rate, as they say in the start-up world.

    And that's for someone like the snowboard guy, who it's still not quite time to hear from.

  • Richard Berry:

    You can come here to start businesses, fail, fail fast, fail forward much, much less expensively than you can other places.

  • Paul Solman:

    Ideal location for a start-up, says economic development pro Gary Oppedahl.

  • Gary Oppedahl:

    Big skies, big ideas. People think big. That's why such great things as the nuclear weapons whole industry, to Microsoft was formed here, to Goddard, to the first computer ever, to Smokey the Bear and breakfast burritos.

  • Paul Solman:

    The latest big idea is a largely government-bankrolled, seven-acre, $150 million innovation complex downtown, anchored by the Rainforest, an ecosystem of business folk and college types.

    Kyle Guin is an enterprising young brain the state wants to keep. So the university provides an apartment upstairs from his classes and space to work on his start-ups- smoke bomb supplier, an app called Pencil-In that scans documents with dates and zips them into your digital calendar.

  • Kyle Guin:

    This was from one of my math classes last semester. So you just take our app, you photograph it. Once you photograph it, you just go to your calendar.

  • Paul Solman:

    Done, saved successfully. Good.

  • Kyle Guin:

    Now go check the calendar.

  • Paul Solman:

    And there it is. Oh, my God.

  • Kyle Guin:

    So, on February 3, you have vector functions.

  • Paul Solman:

    Last day to drop without a grade.

    Just across the parking lot is a makerspace operated by the local community college. The building, recently a soup kitchen, hosts would-be entrepreneurs, a 3-D printed guitar maker, and at last our custom snowboard maker, Marty Bonacci.

  • Marty Bonacci:

    One of the benefits of being in this makerspace was that I didn't have to pay huge overhead, buy all this equipment up front, or lease it and incur all the overhead costs associated with building out the space. That's a big investment and a big risk.

  • Richard Berry:

    What if you're a young entrepreneur? Why would you come here?

  • Paul Solman:

    Yes. Why…

  • Richard Berry:

    The burn rate's less. We have a billion-dollar arts economy. You match the arts with the sciences, and you have a place that accepts you. All of a sudden now, you can have these human collisions with a varied and diverse group of people that can add value to your proposition.

  • Paul Solman:

    As they have to the movie and TV business, says the former mayor.

  • Bryan Cranston:

    You and I could partner up.

  • Paul Solman:

    Those are the stars of the hit cable series "Breaking Bad," which itself partnered up with an eager New Mexico, where the show was made, boasts development booster Gary Oppedahl.

  • Gary Oppedahl:

    "Breaking Bad" was a blockbuster, right? The film office here is one of the best in the world, not says us, says Hollywood.

  • Paul Solman:

    The state has been making a special effort to court TV and movie companies, says Mayor Berry.

  • Richard Berry:

    Captain America, the Iron Man films, the Terminator films, a lot of those were filmed right here. We have the largest film studio in North America five miles south of here. That happened because we were intentional about attracting it.

  • Paul Solman:

    OK, you get the pitch, big skies, low overhead, big mountains, big hopes, but for the state's economy to clamber up from 47th, it also needs to hoist its Native American population, one in 10 new Mexicans.

    The state's 22 tribes don't all measure unemployment, but to take just one example, the Navajo Nation's rate is north of 20 percent.

    First baby step, the indigenous Comic-Con, brainchild of the guy in the hat texting, Lee Francis, from the Laguna Pueblo 47 miles west of Albuquerque. The event draws Native vendors and all sorts of visitors from far and wide.

    The big idea is the same here- entrepreneurship as problem-solver. Native visitors were asked to post their problems, their villains on a board, coal mining, alcoholism, drugs, domestic violence.

  • Lee Francis:

    Domestic violence is a huge one, but around the drugs and alcohol, it's like, oh, well this is how it is. This is how Natives are.

  • Paul Solman:

    An exaggerated stereotype, says Francis, but part of the Native self-image. So the larger goal here is to spur Natives to reframe the narrative.

    Cartoonist Ricardo Cate does it by reframing their history.

  • Lee Francis:

    We're not focusing on your alcoholism. We're not focusing on the drug. We're not focusing on the unemployment. We're saying, hey, there's some really cool stuff. Let's let the imagination fly.

  • Paul Solman:

    And why the images of pop culture superheroes?

  • Lee Francis:

    If we can get in front of our young people and begin to spark that they can be superheroes, that they can be the heroes of their communities, then they begin to think outside of what they have been locked into. And that's where entrepreneurship begins.

  • Paul Solman:

    Rod Velarde, for example, who applies his Jicarilla Apache grandfather's traditional designs to Star Wars characters to inspire enterprising young Natives to prosper and return.

  • Rod Velarde:

    We had a family song. It's called, "Go My Son." "Go My Son" says — talks about an Indian chief talking to his kids. He says, go, my son. Go get an education. Go out there and see the world, but come back and teach your own people.

  • Paul Solman:

    Put them in the driver's seat, so to speak, and hope that they will find their way back home.

    Our last new businessman, Zeke Pena, who works with students to produce and publish a low-budget zine aimed at keeping teens in school, first by focusing on themselves.

  • Zeke Pena:

    My experience growing up wasn't having my story represented in schools, so I was fortunate to stay connected and graduate, right? But a lot of people drop out, and drop out because they disengage and they are not really connected to what they're learning about, right?

  • Paul Solman:

    Pena also teaches students digital skills they can trade on anywhere.

    If you have become very successful in digital media, do you go to, you know, bigger and bigger places?

  • Alonso Estrada:

    We're like the next generation. We're going to be the ones that get New Mexico to the top. So, if I do become a professional, I'm not going to leave, because I'm going to stay here and I'm going to help New Mexico grow up and become more successful.

  • Paul Solman:

    Back at the University of New Mexico, smoke bomb entrepreneur Kyle Guin knows the bigger places question well.

  • Kyle Guin:

    There's probably more's resources. There's probably more money. But there's also 10,000 of me. Here in Albuquerque, there's only one of me.

  • Paul Solman:

    So, you're a big fish in a small pond.

  • Kyle Guin:

    I'm a big fish in a small pond.

  • Paul Solman:

    A pond that his state is desperately trying to grow.

    For the PBS NewsHour, this is economics correspondent Paul Solman, reporting from New Mexico.

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