Shale’s rising tide is lifting all boats, says a new study. The wealth brought on by America’s recent shale revolution hasn’t been confined to the companies drilling the wells and the landowners leasing the property: the average American’s household income is up more than $1,200 last year thanks to fracking. The report, released by the energy consulting group IHS CERA, estimated that the US economy added 2.1 million new jobs thanks to shale and more than a quarter of a trillion dollars to GDP. Bloomberg reports:
Along with jobs at well pads and production facilities, the energy boom will increase employment throughout the economy, [John Larson, vice president of economics and public sector consulting for IHS CERA and lead author of the report] said. By 2020, jobs that can be attributed to higher oil and gas production will reach 3.3 million, according to the report.Disposable income will rise as a result of lower energy prices, adding $2,700 per household in 2020 and more than $3,500 by 2025. Factors that could restrict production — an extension of fracking bans such as the one in New York state or stricter environmental regulations—would result in a rapid decline in the economic benefits, Larson said.
Shale has given America a bounty of cheap energy, which is having a ripple effect on the economy. Manufacturing is up. Households are enjoying lower prices for natural gas, allowing them to heat their homes on the cheap. The rise of fracking has quickly changed not just America’s energy outlook, but the fortunes of the US economy.More of this, please.[Oil rig image courtesy of Shutterstock]