Shale Boom Will Create 1.5M New Jobs by 2035 and Generate $1.5T in Tax and Royalty Revenue
From the IHS study released this week titled "The Economic and Employment Contributions of Unconventional Gas Development in State Economies":
"Unconventional gas activity is having a dramatic impact on employment and economic growth across the U.S. lower 48 states, in terms of jobs and its contribution to gross state product (GSP) and, by extension, U.S. gross domestic product (GDP). This reflects the significant capital intensity required to develop unconventional gas resources, the ability to source inputs from a coast-to-coast network of suppliers and professional services around the United States, and the high quality of the jobs created by this activity.
Unconventional gas is expected to lead future growth in U.S. natural gas productive capacity. By 2015, the share of U.S. natural gas produced from unconventional sources will increase to 67% and, by 2035, will reach 79%. Increased unconventional gas activity will contribute to capital investment, job opportunities, economic growth, government revenue, and lower prices across the country including:
• Nearly $3.2 trillion in investments in the development of unconventional gas are expected to fuel the increase in production between 2010 and 2035.
• In 2010, unconventional gas activity supported 1 million jobs; this will grow to nearly 1.5 million jobs in 2015 and to over 2.4 million jobs in 2035 (see chart above).
• By 2015, unconventional gas activities will contribute nearly $50 billion in federal, state and local government tax and federal royalty revenue; between 2010 and 2035, continued development of unconventional gas will generate a cumulative total of nearly $1.5 trillion in federal, state, and local tax and royalty revenue.
These economic contributions will be largely driven by activity in the 20 producing states with both new well completion and production or existing production. However, the 28 non-producing states that do not include projected unconventional gas development will still contribute nearly one in every five jobs to the overall economy."
Bottom Line: Drill, drill, drill = investment, investment, investment = jobs, jobs, jobs = government revenue, revenue, revenue = win, win, win.
9 Comments:
spencer at angry bear looked at oil/gas patch employment & optimistic scenarios for growth:
"In March, oil & gas extraction employed some 193,000 people. Assume the optimists are right and that over the next 8 years oil & gas extraction employment will grow at near record annual rate of 12.5%. By 2020 this sector's employment would reach some 470,000 -- more than double current levels."
http://feedproxy.google.com/~r/blogspot/Hzoh/~3/4opTTSVMkX0/employmnet-in-oil-gas-drilling.html
just for perspective, there are more than 470,000 currently unemployed in new york city..
so a question about "new" jobs. If demand for energy doesn't change much but the mix of fuels used to meet that demand changes.. i.e. less coal and more gas ...
you get the new jobs associated with the nat gas ....
but in that situation, are you also going to lose jobs in coal?
So.. over the 20+ years that you gain 1.5M gas/oil jobs, would there be an equivalent loss of offsetting coal jobs?
the only real "net" new jobs will be those actually created by increased demand for energy?
or is it a little more complicated than that?
can some of you folks that know this stuff weigh in with your perspective?
For oil - domestic verses imported, I realize that the job question becomes one of domestic jobs vs jobs in the exporting oil countries.
harder to understand - oil from new capital investments vs "old" oil long ago capitalized and now just being pumped out.
so a question about "new" jobs. If demand for energy doesn't change much but the mix of fuels used to meet that demand changes.. i.e. less coal and more gas ...
you get the new jobs associated with the nat gas ....
but in that situation, are you also going to lose jobs in coal?
If all you are doing is changing the mix the argument is valid. You will lose jobs in coal as you create jobs in natural gas. The multiplier works the same way. As each job gained in gas creates a few in sectors that depend on that natural gas job each job lost in coal destroys a few jobs that were dependent on the coal job.
Thank you Van for your thoughts. Much appreciated!
Well with any luck at all the coal jobs might start coming back after the November elections and this crew of seditious ass-clowns can return to Chicago or where ever...
Meanwhile not to knock optimistic employment trends present day employment trends are still looking anemic at best...
"or is it a little more complicated than that?"
Yes, it's a little more complicated than that.
" Yes, it's a little more complicated than that. "
Good!
would you like to ADD/CONTRIBUTE to the discussion?
I've become increasingly skeptical of the threads that bleat "NEW JOBS" , more money, more taxes! "
Perhaps a much better title for some of these rah rah narratives is:
"creative destruction at work: jobs created, jobs destroyed"
Perhaps a much better title for some of these rah rah narratives is:
"creative destruction at work: jobs created, jobs destroyed"
As long as the creation and destruction take place because of free markets we will wind up with progress taking place. What I fear is the politicization of issues and the various games associated with Ponzi schemes that would never get much attention in an environment where central banks and the banking system were not busy creating purchasing power out of thin air.
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