Alamogordo is the economic center of Otero County, with over half the Otero County population living within the city limits. Alamogordo today has very little manufacturing and has a primarily service and retail economy, driven by tourism, a large nearby military installation and a concentration of military retirees. In 2006 the per capita income in Otero County was $22,377 versus per capita income in New Mexico of $29,346.
Alamogordo was founded as a company town to support the building of the El Paso and Northeastern Railroad, a portion of the transcontinental railway that was being constructed in the late 19th century. Initially its main industry was timbering for railroad ties. The railroad founders were also eager to found a major town that would persist after the railroad was completed; they formed the Alamogordo Improvement Company to develop the area, making Alamogordo an early example of a planned community. The Alamogordo Improvement Company owned all the land, platted the streets, built the first houses and commercial buildings, donated land for a college, and placed a restrictive covenant on each deed prohibiting the manufacture, distribution, or sale of intoxicating liquor.
Tourism became an important part of the local economy from the creation of White Sands National Monument in 1934. Construction began on the Alamogordo Army Air Field (the present-day Holloman Air Force Base) in 1942, and the Federal government has been a strong presence in Alamogordo ever since. Education has also been an important part of the local economy. In addition to the local school system, Alamogordo is home to the New Mexico School for the Blind and Visually Impaired, founded in 1903, and a branch of New Mexico State University founded in 1958. The largest non-government employer in the city is the Gerald Champion Regional Medical Center with 650 employees in 2008.
Holloman Air Force Base is the largest employer in Alamogordo, and has a
