Shane Thielges | Shale Plays Media
An article in today’s New York Times examines the breath of fresh air the shale energy revolution has brought to America’s flagging manufacturing industry.
Despite a nationwide downturn in the industry over the past several years, manufacturers in or near shale drilling states are actually experiencing growth thanks to the increasing demands of oil and gas production companies. Economic indicators, including total factory hires, suggest a building momentum in the country’s manufacturing sector.
New energy production is “a real game-changer in terms of the U.S. economy,” said Katy George, who leads the global manufacturing practice at McKinsey & Company, a consulting firm. “It also creates an opportunity for regions of the country to renew themselves.”
Author Nelson D. Schwartz illustrates the trend by examining the positive effect the industry has had on Youngstown, near Ohio’s Marcellus and Utica shale deposits. Ohio’s unemployment, he says, is at 5.7 percent, lower than the national average of 6.1 percent. It’s also significantly lower than it was in 2008, before the shale boom began, when an economic recession pushed levels as high as 10.6 percent.
Youngstown has seen the construction of several new factories that produce equipment for drilling operations. It has also opened what it calls an “Innovation Factory,” a refurbished building with over 20 additive manufacturing systems and related ancillary equipment.
“Both Youngstown and Canton are places which experienced nothing but disinvestment for 40 years,” said Ned Hill, a professor of economic development at Cleveland State University. Now, “they’re not ghost towns anymore. You actually have to go into reverse to find a parking spot downtown.”
Schwartz concludes that this upward trend is liable to continue, and could spread to influence manufacturing in states nationwide, not just those that supply hydrofracking development.
To read the full article, which includes pictures and growth charts, check out the New York Times: Fracking Spurs a Rust Belt Rebound in Manufacturing