Is Marcellus Shale Creating Jobs?
The Marcellus Shale drilling has raised many eyebrows and has left most communities buzzing. Extracting natural gas from this shale has the potential to create many jobs in areas where drilling is taking place. Extracting this natural gas has the ability to provide energy for decades to come. Many communities have mixed emotions on the drilling due to the rumored reports of water contamination, damage to land, and a lifelong surrender of your personal land.
According to numbers, it is forecasted that thousands of jobs will be created in the Marcellus Shale natural gas play. While there has been no negative hit from the economy, jobs continue to form along with developments in the industry. Areas are experiencing an energy/jobs revolution with natural gas development from Marcellus Shale.
In the past several years, there have been many new companies creating an abundance of jobs due to the Marcellus Shale industry. It is not clear how many jobs have arose in the Marcellus drilling areas, but it is clear that there are a rush of jobs, relocation, and gas companies in areas where the drilling is taking place. This rush of new employment is a consequence of new technology which has enabled companies to economically extract gas from tightly packed shale rock.
The increase of people creates a ripple effect throughout the economy. A need for more restaurants, shopping malls, and gas stations has risen and an indirect effect is more than present. Marcellus investments set off a business-to-business chain of spending throughout the area which positively affects the economy. For example, drilling companies hire trucking firms to haul pipe, water, and other materials to a well site. The trucking firm in turn must buy fuel and other supplies to supply these services and hire drivers to operate the trucks. The truck suppliers in turn acquire goods and services from other firms, such as repair shops and parts distributors. When the truck drivers go out and spend their paychecks, that spending stimulus sets a similar chain reaction in motion.
The retail market is also booming in areas where Marcellus drilling is present. Shopping plazas, restaurants, and hotels are developing in areas where they weren’t present before.
Among many of the area’s new jobs are those with actual gas companies and the companies they hire to complete any work and/or labor on site. While there is a huge debate regarding companies hiring out of town employees as opposed to local residents, it cannot be denied that jobs are being created.
Each phase of the drilling requires different skills and a different amount of workers. In the actual drilling portion of a well pad project, the demand is usually 30 to 40 workers to complete the project. The positions vary onsite – from drillers to derrick hands, and supervisors and operators. Sometimes the positions are very mobile and can include traveling to different areas until the drilling is complete. On average, oil and gas workers earn $63,000 per year. There are gas companies who provide training for local residents to get drilling related jobs.
Exact figures are not yet available for how much the Marcellus jobs have created in income and sales tax, but it is predicted that the tax base will widely expand. For example, the hotel business is booming in areas affected by the drilling. Temporary gas workers have been reserving rooms at a rapid pace in the areas they are working. Customers staying at hotels are required to pay a percentage in hotel tax – which then goes to the chamber of commerce and the county. Between 2010 and 2011, this hotel tax revenue increased by 63 percent. In 2010, hotel tax revenue totaled $674,083 compared to $254,847 in 2004.
But is Marcellus creating jobs for the communities it touches? Many local communities are stating that the drilling has created a sense of security and income for them and their families. Below are a few recaps of the jobs the Marcellus Shale drilling has brought to local communities.
In the last year, nearly 48,000 people have been hired in industries related to the Marceullus Shale. 71% of those people were Pennsylvania residents. Nine thousand of these people were hired in the first three months of 2011. These jobs offered an average salary that was higher than the statewide average. The hiring rate is accelerating as the drilling pace picks up. Some of the communities with positive job growth are Pittsburgh PA, Johnstown PA and Bradford County PA to name a few.
Labor and Industry spokesman Christopher Manlove said the department publishes a monthly “Fast Facts” jobs report, and since “we obviously get a lot of questions about Marcellus Shale … it just stood to reason to make a Marcellus Shale version of fast facts.” The report statistics speak for themselves and there has been nearly a 1,300 percent increase in core Marcellus industry jobs in the Northern Tier couties of Bradford, Sullivan, Susquhanna, Tioga, and Wyoming.
Employment in the mining sector has increased more than 57 percent in the last decade –with more than half of that
increasing within the past 12 months. The number of new hires in the first three months of 2011 is almost double what it was the same time last year.
Will these jobs eventually run out once the drilling is done? The answer is probably “yes” – but – this will be a very long time from now. As of now, the economy is boosted due the amount of jobs and business these drill-related companies are bringing in. Marcellus Shale is living up to its expectation and providing jobs and futures for many citizens of many communities.
From an economic standpoint, many believe this is a win-win situation. With an economic growth such as this one, residents of the drilling areas are expected to reap many rewards.