Fuzzy Journalism on Jobs

Mark Green
Posted October 11, 2011

C'mon, Washington Post! In this economy, with 14 million Americans unemployed (including 6.2 million who've been out of work 27 weeks or more), and you're taking shots at an industry eager to hire? Certainly, given the current economic climate, the fact that the Post is pooh-poohing the oil and natural gas industry's job-creating ability proves the axiom that no good deed (not even prospective ones) goes unpunished.

Even so, the Post article doesn't refute our main point: With pro-development policies from Washington our industry could create 1 million new jobs by 2018 and 1.4 million by 2030. Instead, the Post quibbles over what constitutes a direct job vs. jobs that spin off from industry activities. More on "induced" jobs later. But the industry's job-creation number, projected by the Wood Mackenzie research and consulting firm, still stands.

A million new jobs are a million new jobs, whether you're talking about drilling rig workers and pipefitters, or receptionists and gasoline station cashiers. Again, with 14 million Americans looking for work, we think adding a million new jobs before the end of the decade would be a big deal. That's worth talking about, hence the current ad campaign that grabbed the Post's attention.

As for the "wide array of businesses" asking government to "approve their big mergers or lower their taxes," we're not one of them. Basically, the oil and natural gas industry wants government to let it do what it does well: search for and develop energy while also creating jobs and generating tax revenue for government.

Say yes to the Keystone XL pipeline, which would deliver oil from Canada to U.S. refiners, creating 20,000 U.S. jobs during its two-year construction phase and serving as a catalyst for the creation of 500,000 US. jobs by 2035. That's what the Canadian Energy Research Institute says could result from full utilization of Canadian oil sands. Say yes to exploration and production on federal onshore and offshore areas now closed to development. Say yes to letting the number of Gulf of Mexico drilling permits return to pre-2010 levels. Say yes to the game-changing development of natural gas and oil from shale. Essentially, that's one of the implied messages in the report of the President's Council on Jobs and Competitiveness, released today:

"Two examples are the pipeline that would transport heavy oil from northern Alberta in Canada to Oklahoma and the Gulf Coast, and the resumption of deepwater drilling in the Gulf of Mexico in the wake of the Deepwater Horizon spill of 2010. Another is the horizontal drilling and hydrofracturing of shale gas supplies (a matter largely governed by state rules), which led President Obama to note that 'recent innovations have given us the opportunity to tap large reserves - perhaps a century's worth' of shale gas. ... What's gotten less attention, however, is the number of jobs at stake. External estimates suggests that these three streams of private investment could together support or preserve hundreds of thousands of jobs in the next few years."

Here's what job growth could look like, according to Wood Mackenzie (which, by the way, is one of the "external elements" cited by the president's jobs council). Yes, there's lots of job growth projected after 2015, but check the chart: approximately 670,000 new jobs in 2015.

Finally, a word about "induced" jobs. They're hardly a "seldom-used category." Virtually every employment study uses them. The Economic Policy Institute, cited by the Post article? They count them. The Post's "expert," Mark Fulton, the "head of research at Deutsche Bank's team of climate change advisers"? Uh, Fulton also uses this "seldom-used" category in his own work. The White House? Yep, they use induced jobs, too.

There's no question that oil and natural gas can provide jobs, economic growth and security. The key question, the one that's in government's hands, is when we do get started?