SANTA FE — A new state report finds that roughly 32,000 New Mexicans ages 16 to 24 are not enrolled in school, not working and not in any kind of job training — a population the New Mexico Legislative Finance Committee says is costing the state more than $600 million a year and threatening the state’s long-term economic health.
The LFC’s action plan, released April 27, documents how the state’s largest dedicated youth workforce program served just 28 young people who were not enrolled in school over a six-year period — despite a federal requirement that most of its funding go toward out-of-school youth. That finding sits at the center of a broader indictment of a fragmented system of workforce, education and social service programs that often fail to reach the young people who need them most.
“Disconnected youth represent a substantial share of this gap and a key opportunity to strengthen the state’s workforce,” the report states, noting New Mexico’s labor force participation rate of 57.6 percent as of December 2025 — nearly five percentage points below the national rate of 62.5 percent.
The Cost of Disconnection
The LFC estimates that each disconnected young person costs the state approximately $19,500 annually in lost tax revenue. Multiplied across an estimated 32,000 youth, that adds up to roughly $623 million per year. The report also draws on national research to project that those young people may collectively be forfeiting up to $1.2 billion in lifetime earnings.
The long-term consequences are severe. Research cited in the report finds that by their 30s, people who were disconnected as youth earn nearly $38,400 less per year than those who stayed connected to school or work. They are also significantly less likely to own a home, hold a job or report good health.
Who Is Most Affected
The disconnection crisis in New Mexico is not distributed evenly. Native American youth face the highest disconnection rate in the state at 29.2 percent, followed by Black youth at 22.7 percent. Hispanic youth — the largest segment of New Mexico’s young population — are disconnected at a rate of 16.4 percent, representing roughly 23,000 individuals.
Geographically, the problem is most severe in western New Mexico, particularly around Gallup and Shiprock, where estimated disconnection rates approach 30 percent. Albuquerque’s South Valley, where the disconnection rate sits at 17.9 percent, and parts of the northeast and eastern regions of the state also see elevated rates. More than half of all disconnected youth — 56 percent — live in just four counties: Bernalillo, Doña Ana, San Juan and McKinley.
Youth Want to Work, But Face Real Barriers
A March 2026 survey of 230 young New Mexicans not participating in the labor force, conducted by the Workforce Solutions Department, found that 82 percent said they could work if given adequate support. The most commonly cited barriers were housing instability, lack of skills or training, health and disability issues, and wages too low to make work worthwhile.
The survey also found widespread unfamiliarity with available programs — many respondents were simply unaware that education, training or employment opportunities existed for them.
A System That Isn’t Reaching Them
New Mexico currently spends at least $88.6 million annually across six state agencies on programs aimed at youth workforce development and education. But the LFC found that much of that spending is poorly targeted and poorly tracked.
The report found that the federally funded Workforce Innovation and Opportunity Act Youth program — the state’s largest dedicated workforce stream for disconnected young people — served just 28 youth who were not enrolled in school from 2019 to 2025, despite federal law requiring it to direct 75 percent of its funding to out-of-school youth.
Programs like the Pre-Apprenticeship Opportunity Program and the Be Pro Be Proud mobile trades exhibit don’t track whether participants are disconnected before enrolling. The Youth Conservation Corps, which serves more than 700 youth annually, does not record whether participants were in school at the time of enrollment.
The report also flags a timely federal concern: Job Corps centers in Albuquerque and Roswell, which serve roughly 500 youth annually in residential training programs, were slated for closure before federal funding was secured through program year 2026. The LFC noted the centers’ graduation rates and per-enrollee costs lag national averages, leaving their long-term future uncertain at a time when New Mexico can ill afford to lose capacity.
“Many programs are not systematically targeted to disconnected youth, and the use and scaling of evidence-based models is inconsistent,” the report states.
What the LFC Is Recommending
The committee is calling for a 10 percent reduction in the number of disconnected youth within three years — reconnecting about 3,200 young people and bringing New Mexico in line with the national average. That reduction alone, it estimates, would generate approximately $62 million in additional annual tax revenue.
To get there, the report outlines four broad strategies: improving how the state recruits and tracks disconnected youth; refocusing existing programs on that population; expanding evidence-based interventions; and creating a cross-agency accountability structure housed in the governor’s office to coordinate the effort.
On the recruitment side, the LFC is urging the Public Education Department to require school districts to connect every student who drops out to at least one support program. New Mexico currently allows — but does not require — districts to make referrals for chronically absent students, and nearly 5,500 students in grades 7 through 12 dropped out in the 2024-25 school year.
The report also recommends that the state explore partnerships with data analytics firms to identify and reach young adults who have fallen out of the system — a model Central New Mexico Community College already uses in the Albuquerque metro area at an annual cost of $25,000.
On program expansion, the LFC highlights integrated education and training — which combines basic instruction with job training in a single occupation-focused program — as a proven model that should be scaled to serve at least 1,000 additional youth. The Higher Education Department currently enrolls between 123 and 309 youth annually in the model. Fields include healthcare certifications such as EMT training, skilled trades and commercial driving.
Accountability Gap
Perhaps the sharpest criticism in the report is directed at the state’s lack of a coordinating structure to actually own the problem. Agencies track their own programs, but no single entity is responsible for monitoring whether New Mexico’s disconnected youth population is shrinking.
The state has invested more than $16 million in a longitudinal data system intended to track education and workforce outcomes. But after several years of development, the system still cannot answer basic questions — including how many youth who leave high school ultimately become disconnected, or which reengagement programs produce the best results.
The LFC is recommending that the governor’s office establish a cross-agency coordinating body specifically focused on disconnected youth — one that includes meaningful participation from the young people it aims to serve, including Native American youth, youth with disabilities, those with foster care experience and rural youth. The body would be charged with setting shared goals, tracking outcomes across agencies and reporting regularly to policymakers.
Without that structure, the report warns, New Mexico’s $88.6 million annual investment in youth programs will continue to produce results that no one can fully measure.
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The New Mexico Legislative Finance Committee’s action plan on reconnecting disconnected youth was released on April 27, 2026. The full report is available at nmlegis.gov.
