Marcellus job creation not that rosy

Posted by By at 23 June, at 16 : 27 PM Print

The Keystone Research Center published a report this week saying the Marcellus shale industry has created fewer than 6,000 jobs in the past three years in Pennsylvania. That is a far cry from the 48,000 jobs some media outlets have been touting as created in 2010 alone.

The difference?

According to the KRC report, the higher number counted all “new hires,” including replacements for workers who quit, were fired or for some other reason no longer work at their Marcellus industry jobs.

In turn, the media reports – and statements by some politicians and other government leaders – were based on a report by the Department of Labor and Industry which itself specified “new hires,” but did not sufficiently point out the difference between “new hires” and “new jobs.”

It works like this: a company needs another truck driver, so it creates a new position and hires a driver. But the hours are long, the pay insufficient, and the driver quits, forcing the company to hire another driver. The fellow works a month or so before finding a better offer elsewhere, and a new driver is hired to take his place. Meanwhile, a senior driver retires to spend some time canoeing with his grandkids on the Juniata River; the company hires a driver to replace the retired worker.

During the reporting period, our fictitious company has hired four drivers.

It has created one job.

In fact, L&I reports that Marcellus drilling has created 9,288 jobs between 2007 and 2010, and lost 3,619 jobs, for a net gain of 5,669 new, Marcellus-related, jobs in Pennsylvania during the three years the industry has been underway in the state.

L&I did include an explanation of the difference between “new hires” and “new jobs,” but apparently not in bold enough type. A subsequent report by the Marcellus Shale Coalition also touted the 48,000 workers hired last year by “the Mighty Marcellus.”

The industry did not seem unhappy that the media had not seen fit to explain the numbers. Until the day after the KRC report pointed out the error.

Tuesday, Marcellus Shale Coalition president and executive director Kathryn Klaber called the KRC report “yet another thinly-veiled, politically-timed attack on an industry that is creating family-sustaining jobs.”

Later that day, Republican Party of Pennsylvania Executive Director Mike Barley called the KRC report “an attack on job creation.” He said the 48,000 jobs “are real jobs and so are the people filling them and the families these jobs are sustaining.”

Even 6,000 jobs is not a bad contribution to the state’s economy, especially in counties that suffer from low employment opportunities, such as those in the north-central part of the Commonwealth, where most of the Marcellus drilling is occurring. In fact, in the northern tier counties – Tioga Bradford, Susquehanna, Sullivan, and Wyoming – Labor and Industry reports a more than 1,500 percent increase in employment between the end of 2007 and the same time in 2010.

On the other hand, that percentage represented 1,335 jobs. That is a far cry from 48,000 jobs in one year.

It’s not clear, at this point, how many of the “new hires” are from the ranks of Pennsylvania residents previously unemployed, and how many of those jobs are high wage and how many are at the lower end of the pay scale.

The industry is allowed to brag about its job creation, but it would be nice if it would be as quick to correct erroneously inflated numbers as it is to complain when the error is corrected by outside reporters.

As former New York Sen. Daniel Patrick Moynihan noted, “Everyone is entitled to his own opinion, but not his own facts.”

Photo by Tom Owad

This post was written by:
- who has written 169 posts for Rock The Capital
John Messeder is an award winning journalist with more than 35 years experience writing about education, environment and local government issues. He has lived in Maine, Florida, California and Alaska, and, by temporary turns, numerous places in between. John also is an accomplished photographer, and avid hiker, conservationist, oral history buff, and author of several books he has not yet got 'round to writing. He lives in Adams County, Pa., just over a hill from Gettysburg, with his wife and Golden Retriever. He may be contacted at - Email jmesseder

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