UPDATE (7/9/18, 9:30 AM EST): Bloomberg Business reported last week that the oil and natural industry was the top paying U.S. sector in 2017 based on median worker compensation. From Bloomberg’s July 5 article:
“Spurred partly by the shale boom, the median pay for energy workers last year was $123,000, according to data newly mandated by the U.S. That topped all sectors, including utilities, tech and health care. While energy chief executives made an eye-popping 120 times more, the gap with their employees was still the second-smallest among all industries.”
Echoing the Motley Fool article detailed below, Bloomberg’s analysis of company proxy statements revealed the demand for geologists and petroleum engineers has vaulted the oil and natural gas industry to the top spot on the list of highest paying U.S. sectors.
“What’s fueling this paycheck potency? First, a reliance on geologists, petroleum engineers and other highly skilled, well compensated professionals…”
Original Post (6/7/18)
EID reported last year about how the Bureau of Labor Statistics (BLS) expects the surging U.S. oil and natural gas industry to drive U.S. jobs growth through 2026. And as exciting as that news is, the quality of the jobs being created by the oil and gas industry is just as notable as the quantity the BLS is forecasting.
The latest evidence can be found in a recent Motley Fool article headlined “12 jobs with the highest starting salaries.” Three of the top six jobs highlighted happen to be directly tied to the oil and gas industry.
Drilling engineers are listed second on the Motley Fool’s list, with a mean starting salary of $89,167 per year, according to the story. The Motley Fool also notes that in addition to paying well, drilling engineers are expected to be in high demand for the next several years:
“The outlook for drilling engineers is great, with job growth in petroleum engineering projected at 15% through 2026.”
The latter outlook, of course, can be traced to the fact that third party experts such as the International Energy Agency expect the ongoing U.S. shale revolution to make the United States “the undisputed leader of oil and gas production worldwide” over the next decade, with production growth “50% higher than any other country has ever managed.”
The shale revolution has created high demand for chemical engineers — a profession listed fifth on the Motley Fool’s list with an annual median starting salary of $71,842. With petrochemical manufacturing booming due in large part to shale gas. The Motley Fool article states:
“As far as jobs go, employment of chemical engineers is projected to grow 8% over the next eight years — not too shabby.”
Geophysicists are listed sixth on the Motley Fool’s top-12 list with an annual median starting salary of $71,721 per year and — not surprisingly — are in a similarly high demand as drilling engineers:
“Jobs prospects… are strong for geophysicists, with a 14% projected growth rate through 2026.”
Of course, these are just three examples of numerous good-paying jobs with direct ties to the oil and gas industry that are expected to be in high demand for the foreseeable future.
As EID highlighted late last year, the BLS foresees “faster-than-average” employment growth “for a number of oil and gas occupations, including roustabouts, service unit operators, rotary drill operators, and derrick operators.” Rotary drill operators have a mean annual wage of $55,590, while service unit operators make $51,220 and derrick operators make $50,770 on average.
These professions fall under the BLS’s “Support Activities for Mining” category, which business research firm LimeLeads late last year noted tops the charts of fastest growing American industries by a long shot — with employment growth more than 13 times the national average. From the LimeLeads article:
“Of all American industries, Support Activities for Mining experienced the fastest growth rate in the past year. This sector added 52,500 new jobs, bringing its total employment number to 307,000 – a whopping increase of 20.6%.”
Notably, 30,000 of those 52,500 new jobs were oil and natural gas support workers.
And of course, increased oil and gas development has led to a resurgence of employment for drilling contractors and extraction companies (which aren’t included in BLS’s “Support Activities for Mining” category) while also creating jobs for numerous other mining-related occupations, which cumulatively pay an annual mean wage of $58,200.
A recent Energy Futures Initiative report noted that oil and gas extraction employment has increased 16 percent since 2009 — a trend that has correlated directly with the shale revolution. Energy jobs, spearheaded by oil and gas, increased five percent over the past 12 months as the industry recovered from an OPEC-induced commodity price downturn in 2015 and 2016. Fortunately, all signs point to this positive trajectory continuing, as BLS expects all jobs in the oil and gas industry to see an annual job growth rate of 1.7 percent per year through 2026.
And of course, the shale revolution has also had a positive employment impact in sectors not directly tied to the oil and gas industry.
A 2016 study by researchers from the London School of Economics (LSE) found that for every two jobs directly created by fracking, at least one more is created in the manufacturing sector. The manufacturing boom has had a particularly profound impact in Texas, and truck drivers in the Permian Basin are demanding salaries in the $140,000 range according to a recent Bloomberg piece.
All told, a recent American Petroleum Institute report finds that the oil and gas industry supports 10.3 million American jobs, a 500,000-job increase since 2009. Not coincidentally, the United States has enjoyed nine consecutive years of economic growth since 2009, illustrating the undeniable fact that the shale revolution is fueling the American economy in more ways than one.
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Source: Energy In Depth