Indirect employment supported by the sector
Employment related to unconventional oil and gas production in supply chain industries totaled 524,000 jobs in 2012 and is expected to grow 45% to 757,000 jobs in 2025, equal to 41% of total direct and indirect employment supported by the sector.
The study, Supplying the Unconventional Revolution: Sizing the Unconventional Oil and Gas Supply Chain, focuses on direct and indirect contributions from the supply chain industry. It measures economic activity across 56 North American Industry Classification System (NAISCS) sectors.
“Unconventional oil and gas producers sit atop long and diverse supply chains that run through the U.S. economy,” says Brendan O’Neil, managing director, consulting, IHS Economics and Country Risk. “The growth in unconventional production has become an important source of economic activity for these industries at a time when many of their other primary markets were experiencing decline as a result of the Great Recession.”
In addition to jobs supported, the study finds that supply chain industries will contribute more than $16 billion in government revenues in 2015 – up from $13 billion in 2012 – and will rise to about $23 billion by 2025.
Total gross output from this group is expected to grow from $145.7 billion in 2012 to $205.9 billion by 2025.
Total labor income generated by employment in these industries is expected to reach nearly $60 billion by 2025, up from $41 billion in 2012. The average income per employee is estimated to be about $79,000, exceeding the average annual U.S. wage of $68,000.
The IHS study finds that these supply chain benefits are being felt by industries located in states with and without unconventional oil and gas production.