Jobs in Ohio are reportedly up about 347,000 since 2011. The Buckeye economy grew by 2.1 percent in 2013 and 2014. It now has a $2 billion budget surplus.
And the state’s record-setting energy boom of recent years is a big reason why.
Nearly 193,000 of the state’s 5.4 million jobs are related, directly or indirectly, to the shale industry – an increase of 15,670 since 2011, a report from the Ohio Department of Job and Family Services says. The American Petroleum Institute (API), meanwhile, says that the energy sector contributed $28.4 billion to Ohio’s economy in 2014.
These economic statistics are no doubt impressive. Even Donald Trump said so in a recent presidential debate.
But it’s important to know that there is more to the story for Ohio’s strong economy and robust job growth.
True, Ohio is fortunate to sit atop the Marcellus and Utica formations, two of the largest natural gas deposits in the world. But many other states and municipalities are just as fortunate.
Like New York.
But unlike Ohio, the Empire State, in addition to dozens of other municipalities across the nation situated on energy treasure-troves, refuse to enact the necessary, business-friendly, all-of-the-above energy strategies that Ohio has implemented. In fact, in the Empire State’s case, Gov. Andrew Cuomo authorized a statewide ban.
And they’ve been paying a heavy price ever since.
In New York, more than a dozen towns in areas rich with natural gas have threated to secede from the state to join neighboring Pennsylvania, where fracking is permitted. The reason, they say, is lost economic opportunities stemming from the ban.
A recent analysis by the state comptroller says they have a case. Of the 538,000 jobs New York state added between 2009 and 2014, the majority were concentrated in New York City. The rest of the state, regrettably, is struggling. That includes the region where most natural gas operations would be occurring if permitted by the state.
“The Southern Tier, Mohawk Valley, Central New York, and North Country regions all experienced employment declines over the five years, with lower rates of total wage growth,” the comptroller’s study found, according to reports. Not only is overall labor participation is falling, but in areas like upstate New York, regulatory burdens have led to higher taxes and no access to the natural resources under their property.
Conklin, N.Y., southeast of Binghamton, is one of those struggling municipalities. Town Supervisor Jim Finch reportedly said that drilling “would provide an avenue for new jobs and a way to raise money for local schools and governments,” just as it has for nearby states.
By utilizing hydraulic fracturing – an old but reliable drilling technique that has been used safely in Ohio since the 1950s without incident – the state has seen one-time ghost towns morph into boomtowns. Municipalities along the famed Rust Belt have new life. So do many of their hard-working residents, thanks to the higher-paying manufacturing jobs that nearby shale production has supported. Local tax revenue is up. So is wealth for property owners and farmers.
Yet despite the federal EPA saying earlier this year that there was no evidence of fracking activities leading to “widespread, systemic impacts on drinking water resources,” several U.S. communities – even some states – continue to embrace half-truths and fear mongering over the endless economic and environmental benefits that fracking entails.
But not Ohio.
And that’s why the state – along with others which have shown strong leadership to support energy production with balanced, sensible regulatory structures – have fast become the economic envy of their peers.
Michael Zehr is the head of DC operations at HBW Resources.