I mentioned yesterday that hydraulic fracturing, and the subsequent domestic oil-and-gas boom for which the innovative drilling technique has been largely responsible, has been quite the saving grace for the otherwise pretty bleak Obama economy through which the country has been traipsing for the past few years. Even the White House admitted, albeit with the necessary spin included, that the oil and gas industries were the main drivers behind their upward revision of second-quarter economic growth — and a new study out today looks to quantify further the many and widely dispersed benefits of the boom.
Be aware that it is an industry-funded report, but there’s no way to deny the general economic boon going on here:
In 2012, the energy boom supported 2.1 million jobs, added almost $75 billion in federal and state revenues, contributed $283 billion to the gross domestic product and lifted household income by more than $1,200, according to the report released today from IHS CERA. The competitive advantage for U.S. manufacturers from lower fuel prices will raise industrial production by 3.5 percent by the end of the decade, said the report from CERA, which provides business advice for energy companies.
“What really surprised me was how powerful an impact it is having to such a broad base of the economy,” John Larson, vice president of economics and public sector consulting for IHS CERA and lead author of the report, said in an interview. “It makes it to me a story that all Americans really need to come to grips with and understand.” …
Disposable income will rise as a result of lower energy prices, adding $2,700 per household in 2020 and more than $3,500 by 2025. Factors that could restrict production — an extension of fracking bans such as the one in New York state or stricter environmental regulations — would result in a rapid decline in the economic benefits, Larson said.
Given that average household incomes have only continued to shrink throughout this astonishingly slow economic ‘recovery’ we’re supposedly experiencing, I shudder to think what incomes would look like if this oil-and-gas boom weren’t going on.