*UPDATE* New Study: Shale States Weathering Recession Better than Others
UPDATE (see bottom of page)
Intuitively, it’s always made sense that states that actively and responsibly develop their homegrown energy resources tend to do a bit better economically than states that, for reasons of either geology or politics, do not. But a new study released this week and reported on by the Wall Street Journal suggests that the gap between the two is fairly extraordinary – and widening, thanks in large part to the serious boost that shale development is providing to states and their citizens that would otherwise be high and dry because of this economy.
Overall, the study found that seven out of the top 10 states surveyed that saw rises in household income during the current recession were states in which oil and natural gas development is a significant contributor to that state’s economy.
This graph, taken from the study lays in pretty clear detail the top performing states (and in DC’s case, non-states) in the context of overall increases in household income. Of course, it’s pretty obvious why DC tops the list here (recessions are a great time to be doing government work!), but take a look at the states that follow: all but Iowa and Hawaii are major oil and gas producing states:
But the cool thing about this study is that it goes even deeper than the states – it actually takes a look at individual metropolitan areas and examines how they’re faring under the current recession. Take a look at the top performers below. Any of them have anything in common?
From reviving local steel mills, supporting family businesses, and providing jobs for our nation’s veterans, the safe development of America’s homegrown natural resources is providing real opportunities for communities that might otherwise be in a lot rougher shape if those who oppose energy development got their way.
And not for nuthin’: Those who work in the oil and gas industry benefit from wages that are literally tens of thousands of dollars a year higher than those who work in peer industries – consider: the average natural gas industry wage is $76,910 compared to the average household income of $50,398. Just this fact alone makes it clear why groups such as the Laborers International Union of North America and local chapters of the International Union of Operating Engineers are stepping up to support the safe and responsible development of our nation’s natural gas resources. The answer: its reviving blue collar communities throughout the nation.
UPDATE (Feb 8, 11:30 a.m. ET) An article published in today’s New York Times further highlights the economic growth that natural gas production is spurring in communities across the country. The article focuses on Houston, Texas and its resurgence from the recession thanks, in large part, to increased natural gas production from shale:
Powered by a rise in oil prices and a shale exploration boom, Houston is the first major metropolitan region to regain all of the jobs it lost in the recession. The region added about 76,000 jobs last year, according to the Texas Workforce Commission, and is on pace to pick up tens of thousands more this year. (emphasis added)
Last year, 1.8 million square feet of commercial space was vacuumed up, and real estate brokers expect the same or greater this year. “No question, it’s energy,” said Jim Arket a senior vice president at Grubb & Ellis in Houston. “That’s been the multiplier of Houston.”