Shale Drilling Creates Tax Revenue, Few Jobs

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One of the many natural gas pumps that have sprung up around Ohio in recent years.(Photo: Flickr)
One of the many natural gas pumps that have sprung up around Ohio in recent years.(Photo: Flickr)

A new report out of Cleveland State University shows shale drilling has provided an economic boost for several counties around Ohio this year.

Every couple months, a team of researchers at Cleveland State analyzes sales tax revenue and employment data in counties with a high volume of shale drilling activity. And they compare the data to other counties that haven’t had much drilling.

Their latest report shows that the 15 eastern Ohio counties with the highest number of shale gas wells saw a 14 percent increase in sales activity for the first quarter of 2013 compared to the same time period last year.

The finding is consistent with their study from earlier this year.

Ned Hill is the Dean of CSU’s College of Urban Affairs. He attributes the continued boost—in part—to more drilling related businesses performing well in the area.

“You’re also seeing the wealth effect, of people who are taking their rent and royalty checks and spending it in the economy,” he says. “And you’re also seeing in a very big way local purchases of vehicles and trucks to go and work in the field. It does show that there’s real economic activity underway.”

But Hill says the increased sales activity isn’t translating into a big spike in jobs just yet.

“We’re still in the very early stages in the development of the resource,” Hill says.

And he adds that the drillers have largely relied on workers from other states who have more experience in the industry.

Hill anticipates an employment boost will come as more companies focus on building the pipelines needed to carry the oil and gas from the wells to the market in the coming months.

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