A growing number of Los Alamos National Laboratory employees bring their salaries home with them to Santa Fe County, but the lab paid less in New Mexico taxes and bought less from vendors last year, a new economic impact report shows.

The lab’s 2024 Economic Impact on New Mexico report, released Feb. 11, shows LANL employed 16,547 people in 2024, not including contractors, up from 15,932 in 2023. Its budget grew from $4.65 billion in 2023 to $5.24 billion a year later.

Los Alamos County was home to employees with salaries totaling nearly $794 million, the report said. Santa Fe County came in second. A total of 4,172 LANL employees earning $504 million in salaries lived in Santa Fe County in 2024 compared to 3,975 workers and nearly $461 million in salaries a year earlier.

The number of lab employees living here in 2020 was approximately 2,900, according to supplemental figures provided by lab spokesperson Tricia Ware.

Overall, the lab’s payroll increased from $1.86 billion in 2023 to $1.96 billion a year later, not including contractors.

Not all the numbers in the report represented an increase from the previous year. Notably, the amount of money the lab paid in gross tax receipts in New Mexico declined significantly, falling from approximately

$155 million in 2023 to roughly $138 million a year later.

Additionally, the lab’s procurement spending decreased, going from approximately $2.3 billion in 2023 to almost $1.9 billion in 2024. And the amount of money LANL spent on goods and services with small businesses fell, going from nearly $1.2 billion in 2023 to more than $942 million in 2024.

But in the category of small business procurement in New Mexico, LANL spending increased year over year, with that figure climbing from approximately $616 million in 2023 to more than $636 million in 2024.

Ware said she was unable to immediately produce figures that showed the amount of lab procurement conducted with Santa Fe County businesses.

Plenty of room to grow

Those numbers caught the eye of Johanna Nelson, the city of Santa Fe’s economic development director.

“Those are statistics that are great to see for our small businesses,” she said, though she said she believes local businesses could be doing better if more of them became classified as LANL vendors.

“What stands out to me is the effort LANL makes to support our small businesses and the opportunities our small businesses have to take advantage of that.”

Nelson said there’s still plenty of room for those numbers to grow, especially among owners of small businesses in various categories. The amount of money the lab spent on procurement from small businesses in the state varied widely from category to category over the last two years. For example, spending on women-owned businesses surged in 2024 to nearly $85 million in 2024 from $48 million a year earlier, while spending with veteran-owned business tumbled from $61 million in 2023 to $36 million a year later. Spending with disadvantaged businesses declined from $232 million in 2023 to nearly $93 million in 2024.

Nelson said her office works with the lab’s Community Partnerships Office, adding the agency provides excellent insights into local economic trajectories for economic development offices throughout the region. The lab’s CPO also works closely with tribal governments, she said.

Some of the Santa Fe small businesses that work with the lab — including those involved in light manufacturing — have learned to take the highly specialized work they have done for LANL and apply it for other clients, opening new markets, Nelson said.

“There is creativity in innovation that is coming from these companies,” she said. “That’s what I get really excited about.”

Nevertheless, Nelson acknowledged many residents of Santa Fe and elsewhere in Northern New Mexico have significant reservations about the lab’s increased presence in their communities, given its longtime work on the nation’s nuclear weapons stockpile. But she said that issue rarely comes up in economic development circles.

“We see a different side,” she said. “We see the investment the lab is making in workforce development. We see the benefits.”

Nelson pointed to the work being done at the Richard P. Feynman Center for Innovation at LANL, an institution devoted to collaborating with startup companies, existing businesses and investors to enhance national security and stimulate economic growth.

She described the center as a “hidden jewel,” explaining qualifying companies with a specific engineering problem can seek help from the center’s staff. In that way, LANL’s ample brainpower can be used to benefit entrepreneurs throughout the region, Nelson said.

Discounting the report

Longtime lab critic Greg Mello, founder of the Los Alamos Study Group, an Albuquerque nonprofit dedicated to working for nuclear disarmament, economic sustainability and other causes, roundly dismissed the new report as well as the notion LANL is an economic engine for the region.

“Los Alamos National Laboratory has no visible overall positive impact on Northern New Mexico,” he said. “Yes, money’s spent by LANL, but it does not produce economic development.”

In fact, Mello contended there is a negative correlation between the lab’s growing budget and the economic performance of Northern New Mexico. The technologies the lab develops do not move outside the LANL fence because they are specialized and classified, he said, while its spending applies to only a small number of businesses or people and does not trickle down.

Mello also bemoaned the influence the lab has on political leaders throughout New Mexico, arguing their approach to LANL always takes one form — support for increasing its budget, no matter how that money is designed to be spent.

Mello acknowledged the hundreds of millions of dollars in salaries paid to lab employees who live in Santa Fe County. But he said those workers are largely to blame for driving up the cost of housing in Santa Fe.

Mello claimed 40% of the new housing that has been constructed in Santa Fe in the last five years has been taken up by LANL employees. He also cited a 2019 University of New Mexico study commissioned by the lab, an early version of which reportedly revealed LANL’s fiscal impact on its bedroom communities was negative, costing those governments more in the services they provided than the revenue the lab brought in. Lab officials have disputed those figures.

“LANL can crow all they want about the money, but spending taxpayer money is not good, in and of itself,” Mello said.

Mello challenged observers to look at the outcomes the lab produces, not the input of money, before deciding whether LANL’s presence has helped Northern New Mexico’s economy.

“Otherwise, we fall into the trap of thinking money alone is economic development,” he said. “Money just bids up the price of everything.