There's a lot more than just oil and gas flowing out of America's shale bonanza. The energy boom is fueling employment growth. While most of the initial jobs have been the direct jobs that support drilling, these are beginning to spill over into other industries that are beginning to flow with jobs.
According to the Bureau of Labor Statistics, oil and gas industry jobs have grown by 40% between 2007 and 2012. Over that same period U.S. payrolls have grown by a meager 1%. While the politicians will fight over who's creating the jobs, the recovery is clearly being fueled by America's energy boom.
Overall, oil and gas jobs are just a drop in the overall jobs bucket. The industry supports 2.1 million jobs which makes up one half of one percent of all jobs in the American economy. That said, it's the indirect and induced jobs that are beginning to add up.
Driving jobs growth
One industry that's flowing with jobs is the trucking industry. Each well that's hydraulically fractured needs millions of gallons of water as well as sand and other chemicals. Those loads are hauled by truckers. That's just the start.
The energy boom is one of the reasons why overall truck tonnage has been increasing over the past few years. In fact, American Trucking Association's Chief Economist Bob Costello attributes part of robustness in truck tonnage to the energy boom. He noted that industries like it, "produce heavier than average freight, which leads to faster growth in tonnage versus a load or shipment measure."
For-hire trucking employment has risen steadily over the past few years. While it's still below the 2007 peak, the future suggests there are more jobs to come, especially has housing recovers. According to the Bureau of Labor Statistics, trucking jobs should grow by 20.6% between 2010 and 2020.
Manufacturing jobs growth
The energy boom is creating a competitive advantage for American manufacturers. So far cheap natural gas has added 530,000 manufacturing jobs since 2010. Further, if gas prices stay low the manufacturing industry could add another five million new manufacturing jobs by 2020. However, that is just part of the equation as according to America's Energy Advantage, every manufacturing job created yields five more support and network jobs.
This is why companies like Dow Chemical (NYSE: DOW) and Huntsman (NYSE: HUN) have joined America's Energy Advantage to limit how much natural gas we export to other countries. This is because Dow Chemical hopes to hire more than 600 workers as part of four new petrochemical plants it's planning to open between now and 2017. The company also sees these plants supporting 2,000 jobs at peak construction and another 35,000 support and network jobs. Overall, Dow Chemical and Huntsman see the manufacturing industry spending up to a $100 billion to build petrochemical manufacturing complexes along the Gulf Coast. Even a small fraction of that number would create a large number of permanent manufacturing jobs, as well as a large number of indirect and induced jobs such as in the construction of those facilities.
Constructing jobs growth
We tend to link construction with housing, but the energy infrastructure build out will create a lot of construction jobs. For example, the hotly contested $5.3 billion Keystone XL project by TransCanada (NYSE: TRP) is projected to require 9,000 skilled American construction workers to complete. These jobs would include welders, mechanics, electricians and many others. In addition to this, TransCanada estimates another 7,000 U.S. jobs will be required to support the construction. Those would include manufacturing jobs to make the steel pipes along with a range of other pumps, valves and control devices needed to keep the oil flowing.
That's just one example. Another is Enterprise Product Partners (NYSE: EPD), which is currently building $8 billion worth of projects. Like TransCanada it's building its share of pipelines. However, the company is also building a range of energy related infrastructure including fractionation units, oil storage units, and a propane dehydrogenation plant. Enterprise Product Partners has hired thousands of construction workers to build these projects and will continue to hire as it green lights new projects.
America's energy boom is fueling the creation of most of the country's new jobs. It's also creating a big opportunity for investors as the supplies being delivered and the projects being build will one day deliver income to shareholders. It's an exciting time for the future of America.
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