SANTA FE — New Mexico had a net gain of 6,900 jobs in a year, state Economic Development Secretary Jon Barela said Wednesday.

Appearing before the Legislative Finance Committee, Barela said 10,000 private-sector jobs were created between August 2012 and August of this year. But during that span, the state lost 3,100 government jobs, mostly at the federal level, he said.

Barela said he was cautiously optimistic about the economy because of those statistics.

The downside of losing so many government jobs is that New Mexico is the state most heavily dependent on federal spending, he said.

State Rep. Larry Larrañaga, R-Albuquerque, said New Mexico needed a net gain of 16,000 jobs just to get back to the level it was at before the recession started in 2008.

Larrañaga also said increasing employment at existing companies was something the state had not done well enough.

In response, Barela said many of the job gains of the last year were because of expansions by existing companies. Barela said the climate for business had improved since March, when the Legislature on its last day in session approved a bill to reduce corporate taxes and create other breaks for businesses.

The tax bill was coveted by Republican Gov. Susana Martinez, Barela's boss.

The hearing became combative when state Sen. Howie Morales challenged Barela's previous statement that two companies had stayed in New Mexico because of the tax bill.

Morales, a Democrat from Silver City and a candidate for governor, asked Barela if he would identify the companies that he said had been saved.

Barela said there actually were three companies, but he would not name them, other than to say they were large employers in the Albuquerque metro area. He said job deals involving his department often were built on confidentiality.

Morales said Barela had made the claim of jobs being saved in a public meeting, and, for that reason, he was following through with a question about the specifics.

Barela then said to Morales, "I hope you are not questioning the integrity or honesty of my answer."

Later, Barela said he hoped the exchange was not perceived as contentious.

He elaborated on why he could not identify the companies that he said remained in the state because of the tax bill.

"A company very often doesn't want to get in the fray," Barela said.

In terms of job growth, Barela said financial services was the sector with the highest growth at 5.8 percent. It was followed by hospitality, education and health, construction, and mining and logging.

Barela said he was encouraged by job growth in the four metro areas, Albuquerque, Santa Fe, Las Cruces and Farmington. But, he said, 1,440 jobs were added in rural areas during the last year. He said this exceeded his department's goal of 1,100 jobs for rural New Mexico.

Small-town development brought another exchange between Barela and Morales.

Morales asked how much of the Economic Development Department's request for $500,000 for its MainStreet initiative would go toward capital improvements.

After consulting with his staff, Barela said all the money would be for operations and none for brick-and-mortar improvements.

Barela said he wanted to obtain private money to help with various projects. For instance, he said, he would ask film companies to partner with the government in renovating historic theaters in downtown districts.

Milan Simonich, Santa Fe Bureau chief of Texas-New Mexico Newspapers, can be reached at 505-820-6898. His blog is at