Letter to the Editor: Economic Development And The Health Of Los Alamos

President, LABi

Many factors contribute to the economic health and vitality of a community. Two of the most important are Commerce and Economic Development. You might believe that these two factors describe the same thing, but they do not.  o distinguish between them it is important to start with two other terms – community and county.

The community of Los Alamos is the group of people that reside within the boundaries of the legal entity called the county. You might want to include the daily commuters as part of the community, but this can confuse the discussion. Beyond the people themselves, the community also includes the businesses resident in the county. The importance here is that the community is composed of private entities that are primarily focused on private activities.

The County of Los Alamos is a governmental entity that represents the members of the community. It is solely owned by and operated for the benefit of the residents of the county who, privately, are members of the community. The county government must be responsive to the needs of the community and does not engage in for profit business.

The importance of this distinction is that Commerce and Economic Development are community terms, not governmental terms. Sure, the government can support and enable commerce and economic development, but it is the private sector (the community) that actually does it. While we tend to use the terms interchangeably, it is important to keep public and private distinctions clearly in mind.

Commerce accounts mostly for the internal transfer of money; retail sales and services. It is the county’s economic circulatory system in that it mostly recycles the money already present here and it can, indeed, contribute nicely to our economic health as the money moves from one internal group to the next. But it does not generate new money.

Ignoring the supplies used, the service sector tends to be a strong promoter of the recycling of revenues within our community; that is, if the services are from a Los Alamos provider. There is often only a small amount of net revenue loss to the community with Los Alamos-based service providers and probably a net neutral or positive effect on the County if the services are provided to an exporter.

However, when money moves to the retail side of the equation – as with the purchase of products – a chunk of it, sometimes a large amount, moves directly outside of the area to whoever manufactured the item and any external group that may own the store where the item was purchased. This effect can be lessened if the products purchased are manufactured here, but this is not that common in Los Alamos.

Outside-owned retail outlets make up for some of this through the salaries of their employees that live here, and by serving customers that come from other areas. However, in Los Alamos, the very isolation that spawned the development of the County in the first place, works against us in this situation. Are we close to being a magnet for customers from our surrounding area that some other communities (e.g., Farmington) are, especially with Santa Fe and Espanola so close by? Can we, on a sustained basis, expect people to trek to Los Alamos only for retail commercial engagement? Probably not.

For good economic vitality, exports from a community must either balance or, much better, far exceed imports. That is where Economic Development comes in. Economic Development is all actions taken within a community to increase the export of products (goods and services) produced within the community. The hard part is developing a unity of effort within a community towards maximizing its economic development.

Stated another way, Economic Development is all about the export of goods, services, and experiences. For experiences, tourists and outdoor enthusiasts (a much under-exploited group here but with high potential) can bring in lots of external money. It also is another way that our retail outlets, hotels, and restaurants can contribute directly to economic development as well as to commerce. After all, “they have to eat sometime.”

Los Alamos Business incubation (LABi) believes that export is the main way that Los Alamos can be vital in the long-run and reduce its dependence on LANL. For us, it means working to get the County to take steps to make our community more attractive for outside companies and investors. That is why we have been working to get high-speed internet access to our two main business districts; the main economic engines of the County.

It also means developing new companies right here in Los Alamos using the unique talent pool that comes from the exceptional people who live here. In the Los Alamos Community, we have people with incredible skills (e.g., machinists) that do and can draw-in a lot of work, and revenue, from outside our area.

Through the Los Alamos Community talent pool (we call it the Tech Army) we have the capability, to develop Intellectual Property, to create in-demand products, and to create a large number of new businesses with high commercial potential.

Wonderfully, the capabilities of just the spouses of the people who work at the Lab would be the envy of most communities. Add people retired from the Lab, current LANL employees with a passion for entrepreneurship, and all the other members of the community with ideas and energy to pursue a dream and you see a brilliant, glowing vein of riches in the mine named Los Alamos.

LABi is working to utilize these talents and build companies, preferably here in Los Alamos, to enrich its citizens and greatly increase the net exports of the Community. We have many ideas about how to do this and invite anyone interested to access our website for more information at techarmy.labi505.com.