Appalachian Basin

Missing Context: Oil and Natural Gas Key Provider for Eastern Ohio

A recent article by Energy News Network attempts to explain why Ohio’s top oil and gas producing counties lag behind the state’s average unemployment rate. However, the article is missing key context and fails to underscore the immense benefits the industry has brought to Eastern Ohio.

1. The oil and natural gas industry is a key provider of jobs and wages – and without these, poverty rates for Eastern Ohio would be even greater.

Ohio’s oil and natural gas industry has been a crucial economic lifeline for Eastern Ohio.

Energy News Network notes:

“The Ohio Department of Job and Family Services (ODJFS) estimated about 8,600 people worked in core shale-related industries in 2021, with another 184,000 working in “ancillary” industries ranging from trucking to engineering.”

However, missing from this article is the true context of what that means.

The same report from the ODJFS shows the average wage in core oil and gas related industries is $81,749, while ancillary industries maintain a wage of $70,787. In both cases, this is higher than the average wage in all Ohio industries: $51,740 – therefore, showing that jobs in the oil and gas industry actually buck statewide averages for wages and provide good, family-sustaining jobs for workers in Eastern Ohio and elsewhere.

Additionally, while the article provides a slight nod to the land royalties and economic investments the industry provides, it again fails to put this into scale. From the article:

“Industry money has helped build new schools in places like Carroll County and Jefferson County. Owners of leased land and local governments have also benefited from industry money. But that may not be enough.”

A Cleveland State University report, commissioned by JobsOhio, shows that from the beginning of the Shale Revolution in Ohio in 2011 through June of 2021, the oil and gas industry invested an estimated $95.3 billion into Ohio. This includes more than $300 million to improve Ohio roads, build schools as the article notes, and boost Ohio landowners by nearly $8.6 billion in royalty payments– most being in the heavy-producing counties of Eastern Ohio this article analyzes.

Indeed, there is much more work to be done to ensure Eastern and Appalachia Ohio are a thriving place to live, work, and raise a family – but where would these counties be without these crucial jobs, wages, and investments from the oil and gas industry?

2. Population in Eastern Ohio is declining, following statewide trends – not specific to the oil and gas industry.

Second, comparing rural, Eastern Ohio unemployment rates to other counties across the state like Franklin, Hamilton, and Cuyahoga with their sprawling urban suburbs is comparing apples to oranges. It’s simple geography that Ohio’s top oil and gas producing counties are also areas that are the least heavily populated and industry dense.

And as the article mentions, these counties have seen overall population decline, therefore affecting workforce and statewide averages:

“Even with more money flowing into the counties from the oil and gas industry, the population in the counties has declined. And with fewer people in the workforce, the counties also have fewer total jobs than a decade ago, the Job and Family Services data show.”

It’s unfair to equate this loss to somehow being a failure on the part of the oil and natural gas industry.

3. Industry dealing with increased scrutiny – can’t simultaneously discourage oil and gas and then call on it to be the answer for everything.

Finally, it’s worth pointing out that in recent years, the oil and gas industry in Ohio and throughout the country is facing increased scrutiny, higher regulations, and mixed messages.

President Biden openly promised on the 2020 campaign trail to halt all oil and natural gas leasing and has largely fulfilled that promise, while his administration has canceled domestic pipelines, taxed natural gas, threatened the industry with a misguided windfall profits tax, falsely accused companies of price gouging, and encouraged a rapid transition away from needed fossil fuels.

These actions make it increasingly hard for the oil and gas industry to have certainty in future investments in an industry that craves stability – and therefore harder to create jobs in places like Eastern Ohio.

As we’ve seen time and again, the oil and natural gas industry is simultaneously being demonized as the problem and then looked to as the solution.

Bottom Line: The oil and natural gas industry has and continues to lift up workers and families in Eastern Ohio, and without it, poverty rates would be even higher. Increased certainty from the federal government, along with the policies that Ohio is already working on such as broadband and workforce development, will only help support these trends.

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