Appalachian Basin

New Jobs Report Shows Shale’s Promise In Ohio

A recent Ohio Department of Job and Families Services (ODJFS) Shale Report shows Ohioans are benefiting once again from shale development.  Coupling the recent US Chamber study touting employment of 38,830 people related to shale development in Ohio and sales tax revenues jumping in the shale development region of the state, the ODJFS report further solidifies shale development’s tremendous positive impact on eastern Ohio.

The report found several items worth noting when discussing the remarkable impact shale development has had on Ohioans over the past year.  Not only has core shale related employment increased by 17%, but wages earned in the industry in Ohio are $30,247 greater than the state average, helping Ohio recover from the recent recession.

The ODJFS report also found unemployment rates in many of the counties in the shale producing region have gone from being above the national average to dropping below the national average in just one year.  It should also be noted that all counties that had shale development experienced a significant drop in unemployment.

Here are a few items from the ODJFS Executive Summary worth mentioning:

 

Wages:

  •  The average wage across all industries in Ohio for 2011 Q2 through 2012 Q1 was $43,687.
  •  The average wage in the core industries was $73,934 and is approximately $30,247 greater than the average wage for all industries.
  • The average wage in the ancillary industries was $58,765 and is approximately $15,078 higher than the average wage in Ohio.

It should be noted that although the average wage in Ohio is $43,687, these wages tend to be much lower in eastern Ohio where the majority of the wage associated with shale development takes place.

 

Employment: 

  • Core industry employment (such as pipeline construction and well drilling) was up 1,066 (17 percent).
  •  Ancillary industry employment (such as freight trucking and environmental consulting) was up 4,809 (3.1 percent).
  •  All industry employment was up 90,435 (1.9 percent).

As you can see, core industry employment and ancillary industry employment both outpaced Ohio’s industry employment.  This comparison continues to show that shale development is one the quickest growing industries in all of Ohio.

 

New Businesses Established:

• 39 core business establishments were added. Ancillary industries declined by 14 establishments.

• This represented 6.7 percent growth in the core industries and a modest decline in the ancillary industries. Over the same time period, Ohio experienced 0.2 percent growth for all industries.

 

Shale development continues to add new business establishments to meet the demand of shale exploration in the state.  Adding 39 new establishments represented a 6.2% increase greater than the state average.  Again the investments made by shale development is outpacing Ohio’s other industries in terms of new businesses.

Further down in the report, the ODJFS pointed out that unemployment rates are dropping in some areas of the shale development region by as much as 3% in just one year.  If we look at the top seven Utica/Point Pleasant permitted counties in Ohio, we see a significant decrease in unemployment rates which also have seen considerable gains in sales tax revenue over the past year.

  • Carroll County: 9.9% in 2011 down to 6.9% in August 2012
  • Harrison County: 10.2% in August 2011 down to 8.0% in August 2012
  • Columbiana County: 10% in 2011 down to 7.6% in August 2012
  • Jefferson County: 11.2% in 2011 down to 10.6% in August 2012
  • Guernsey County: 9.7% in 2011 down to 7.4 in August 2012
  • Noble County: 11.8% in 2011 down to 9.2% in August 2012
  • Monroe County: 10.7 in 2011 down to 9.1 in August 2012

 

While shale development is still in the early stages of development, it continues to help lift eastern Ohio to prosperity.  As development and investment increases, counties will continue to see decreases in unemployment and more Ohioans having well paying jobs.  Coupling the US Chamber’s study, the sales tax revenue boost over the past year and this ODJFS report, it is hard to deny the positive impact Utica Shale/Point Pleasant development is having on Ohio.

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