Shale jobs to multiply for years, study says

By Burton Speakman


Ohio and Pennsylvania already rank in the top 10 nationally in terms of jobs created by shale-gas production.

In the next 25 years, each state will experience significant growth in terms of shale jobs, said John Larson, primary author of a report for IHS, a company that compiles such information.

In 2010, Ohio had 31,462 jobs attributable to shale-gas production. According to the study, that number is expected to increase to 41,366 by 2015 and 81,349 by 2035.

Meanwhile, Pennsylvania has 56,884 jobs that are part of work in the Marcellus Shale. The study expects that figure to increase to 111,024 in 2015 and 270,058 by 2035.

Ohio’s growth lags a bit because it started in shale development later than Pennsylvania, Larson said. “I expect Ohio at some point to roughly reach the same levels as Pennsylvania,” he said.

This study compares to one released in 2011 by Kleinhenz & Associates, prepared for the Ohio Oil and Gas Energy Education Program, that claimed drilling would create 200,000 jobs in Ohio by 2015.

Thus far, there have been 1,500 to 2,000 jobs announced for the Mahoning Valley related to work in the Utica Shale, said Eric Planey, vice president of International Business Attraction for the Youngstown/Warren Regional Chamber.

“These are jobs that have been announced in the supply portion of the business,” he said. “We have not yet gotten our arms wrapped around how many drilling jobs have been created.”

Planey agreed that Ohio is behind Pennsylvania at this point in terms of shale jobs created, but he does expect the state to catch up to its eastern neighbor.

Early in the drilling process, jobs in Ohio may be filled by workers from other states, Larson said. As the industry matures, local workers will be trained and out-of-state workers will become residents.

Pennsylvania and Colorado will lead the nation in terms of job growth through 2015 with expected compound annual growth rates of 14 percent and 10 percent, respectively, according to the study.

Nationwide, the expectation is only for 1.6 percent growth in employment, Larson said.

Pennsylvania’s figures are a good sign in a time of slow economic recovery, he said.

Other states with unconventional gas production also are expected to see job growth above national averages, Larson said.

Job growth in the Mahoning Valley is not limited to shale positions.

Employers within the Youngstown-Warren-Boardman metropolitan service areas expect to hire at a strong pace during the third quarter of 2012, according to the Manpower Employment Outlook Survey released Tuesday.

During the quarter, 17 percent of the companies interviewed plan to hire more employees, while 2 percent expect to reduce staff. An additional 80 percent expect to maintain their current work-force levels, and 1 percent are not certain, according to the report.

“The employment forecast for the third quarter is healthier compared to the second quarter of 2012,” said Jeanne Farmer, Manpower spokesperson. “Employers expect much improved employment prospects compared with one year ago when the Net Employment Outlook was 1 percent.”

The IGH study further focuses on increases in expected revenue.

Growth in unconventional gas development already has had an impact on the tax base in Pennsylvania.

Pennsylvania received $1.48 billion in 2010 from the natural-gas industry, while Ohio received $317 million in revenue.

The commonwealth’s 2010 state budget included $11 billion for public transportation and $9 billion for public safety and criminal justice. A combination of corporations, businesses and individuals supporting unconventional natural-gas activity paid a combined total of $641 million in taxes to Pennsylvania state and local governments that year, accounting for 6 percent of the state’s transportation budget and 7 percent of spending on public safety and criminal justice.

Unconventional gas activity supported more than 1 million jobs nationally in 2010, and it will grow to support nearly 1.5 million by 2015, according to the study.

“Even nonproducing states will see an economic impact by serving as suppliers for producing states,” Larson said.

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