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Economists question Corbett's Marcellus Shale jobs claims

Gov. Corbett promoting the Marcellus Shale earlier this year in Williamsport.

Gov. Corbett promoting the Marcellus Shale earlier this year in Williamsport.

Governor Tom Corbett, who faces tough poll numbers when it comes to his hopes for re-election, formally launched his campaign today in Pittsburgh, highlighting the state’s Marcellus Shale industry as one of the key successes of his time in office.
“The energy industry in Pennsylvania is now supporting the livelihoods of over 200,000 people and their families who work in good-paying middle class jobs,” he told the crowd.
But economists say that jobs number is questionable.
The most recent figures from the state Department of Labor and Industry show 28,155 people working directly in the oil and gas industry.
The 200,000 figure includes workers in ancillary (or related) industries.
In its attempt to quantify the affect of the Marcellus Shale, the state counts every worker in 30 related industries— including every trucker, road construction worker, and steel worker in Pennsylvania.
Penn State professor Tim Kelsey serves as co-director of the university’s Center for Economic and Community Development. He thinks the governor’s jobs estimate is off.
Corbett’s overall figure is seven times the number of direct oil and gas jobs.
“Any multiplier higher than two is looked at pretty suspiciously by economists,” says Kelsey. “[The state is counting] related sectors, including transportation. So they’re counting FedEx and UPS drivers and long-haul truckers that have nothing to do with Marcellus.”
Bucknell economics professor Thomas Kinnaman agrees.
He says even though the gas industry employs many independent contractors in related jobs (like truck drivers hauling water, for example) and there are other induced effects (like hotels and restaurants seeing more business) Corbett’s number is still questionable.
“In order to justify a number like 200,000 you’d need an optimistic perspective of the industry’s output of gas, you’d need an optimistic view of what the multiplier is, and this industry would have to be very different from other industries,” says Kinnaman.


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