I regularly see right wingers and republicans claiming that we should allow unlimited oil and gas drilling because it would create so many jobs.
If you look at the recent data on growth in employment in oil & gas drilling it appears they may have a good argument. Over the past year employment in oil & gas drilling rose 11.3%, only down slightly from its January peak of 14.5%. Employment growth in the sector almost reached its 1980 peak growth rate of 16.5 %.
In March, oil & gas extraction employed some 193,000 people. Assume the optimists are right and that over the next 8 years oil & gas extraction employment will grow at near record annual rate of 12.5%. By 2020 this sector’s employment would reach some 470,000 — more than double current levels.
To put this in perspective, assume continued sluggish economic growth of some 2% to 3% real GDP growth and annual employment growth of around 1.6%. . By 2020 this would bring the unemployment rate under 5%.
Currently, oil & gas exploration employment is some 0.15% of total payroll employment. That is correct, zero point fifteen percent, not fifteen percent. Under the assumed sluggish growth scenaro
oil & gas employment would reach a new record share of 0.32%f of payroll employment in 2020.. The some 289,000 increase in oil & gas extraction employment would account for about 1.6% of the total employment gains.
It is like last years record real GDP growth in North Dakota. Because of the oil boom in 2011 real GDP
grew 7.5% in North Dakota, far stronger than any state. This very rapid growth caused North Dakota’s share of total US real GDP to rise from 0.24% to 0.26%
So even if you allow them to have their extremely optimistic assumptions, unlimited oil & gas extraction is unlikely to have a significant impact on total employment growth.