While the United State economy struggles to achieve meaningful growth, one sector of the economy that continues to overachieve is the energy sector. A new report by the Small Business and Entrepreneurship Council (SBE) said that energy firms were one of the largest job creators during 2005-2010. It’s important to note that during the same 2005-2010 period, overall employment declined for small businesses in the United States. In terms of looking ahead Raymond J. Keating, Chief Economist of the SBE Council said:
“Growth opportunities for small businesses and employment in the U.S. energy sector look bright due to increased natural gas demand, including in international markets. The opportunity exists for exporting liquefied natural gas (LNG). Expanded demand for U.S. natural gas internationally will be a net positive, resulting in greater U.S. natural gas production, increased investment, enhanced GDP growth, rising incomes, and more jobs.”
By the Numbers (courtesy of SBE)
Rising Production. Natural gas production increased by 27
percent from 2005 to 2011. This increase in natural gas has
come from high production levels from shale gas, which
• The number of drilling oil and gas wells employer firms grew by 7.2 percent, including 4.7 percent among firms with less than 20 workers and 7.3 percent among firms with less than 500.
• The number of oil and gas operations employer firms grew by 24.5 percent, including 24.5 percent among firms with less than 20 workers and 24.6 percent among firms with less than 500.
• The number of oil and gas pipeline and related structures construction employer firms grew by 5.1 percent, including growth of 3.5 percent among firms with less than 500 workers.
• The number of oil and gas field machinery and equipment manufacturing employer firms grew by 61.0 percent, including growth of 59.0 percent among firms with less than 20 workers and 62.7 percent among firms with less than 500 workers.
Small Business Population. At the same time, small and midsize firms overwhelmingly populate each of the energy sectors considered. Businesses with less than 20 workers came in at:
• 91.3 percent of oil and gas extraction employer firms;
• 80.4 percent of drilling oil and gas wells employer firms;
• 84.7 percent of oil and gas operations employer firms;
• 63 percent of oil and gas pipeline and related structures
construction employer firms; and
• 60.3 percent of oil and gas field machinery and equipment
manufacturing employer firms.
With the United States in the middle an energy revolution there seems to be unlimited potential in what can be accomplished. States such as Arkansas, Colorado, Louisiana, North Dakota, Oklahoma, Pennsylvania, Texas, Utah, West Virginia, and Wyoming are all emerging as leaders in the liquefied natural gas market. One thing that threatens this energy revolution is unnecessary government regulation and red tape that kills jobs and stifles innovation. Government should be doing everything possible to encourage these job creators, not standing in their way