In recent years, politicians, oil and gas lobbyists, and industry experts all promised that expanded oil and gas drilling in Ohio would lead to job creation and economic growth. However, a new report from Cleveland State University shows that even though economic activity increased in shale counties in 2012, employment growth failed to materialize.
A March report from the Maxine Goodman Levin College of Urban Affairs examined two economic indicators to see if there existed any early economic trends in the development of the shale region in Ohio.
On the sales tax side, so-called “strong” shale counties saw significant growth in 2012. These counties’ average sales tax receipts increased by 21.1 percent compared to “weak” shale counties, where growth was 10.9 percent. Non-shale counties grew by just 1.3 percent.
Employment growth during 2012 in Ohio’s shale counties was not nearly as strong. While strong shale counties saw employment gains of 1.4 percent last year, this amount was not significantly different than any another other group of counties.
These findings contradict industry experts and lobbyists who promised that oil and gas development would lead to a boom in employment for Ohioans. If the 2012 numbers are any indication, it would seem that the promises made about a coming oil and gas job boom were most likely exaggerated.
In December, we highlighted comments from Governor Kasich expressing concern about “foreigners” coming to Ohio and taking jobs in the oil and gas field. At the time, we encouraged the Governor to promote legislation to create incentives for companies to hire Ohioans instead of shipping in workers from other states.
Now that the numbers have shown that employment growth has failed to materialize, we once again call on policy makers to develop strong incentives to encourage the hiring of Ohio workers in the oil and gas industry.