Industrial towns across America have struggled in the face of plant closures and outsourcing for years, but natural gas from shale deposits is helping to bring U.S. manufacturing into a new era of global competitiveness, according to a White House report making a splash in Washington last week.
Released in conjunction with President Obama’s “Insourcing American Jobs” forum, applauding companies that are bringing jobs and investment back to the United States, the report justifiably credits our country’s abundant and affordable shale gas supply for helping to revive the nation’s manufacturing sector and fuel America’s economic rebound.
Importantly, the report included a nod to America’s chemistry industry:
The surge in domestic natural gas production can lower energy costs, reduce pollution and drive investment in the industries that supply equipment the natural gas sector and those that use natural gas as an input to production, like the chemical industry. . . . If harnessed in a safe and responsible manner, these natural gas resources present an extraordinary opportunity to lower input costs for many manufacturers and to create, according to most analyses, several hundred thousand new manufacturing jobs in the coming years.
Two decades ago, the domestic chemistry industry was struggling to cope with supply shortages and volatile U.S. natural gas prices that forced companies to think twice about expanding U.S. production. Since the mid-2000s, however, the discovery of new shale gas reserves and the development of new production technologies have led to growing domestic natural gas production and relatively low prices for households and industrial users.
As a result of those relatively low domestic energy costs, “companies like Dow Chemical and Westlake Chemical have announced intentions to make major investments in new facilities over the next several years,” bringing much needed jobs to America’s heartland, the White House recounted. Of course, the success of these and other investments hinges on policies and regulations that allow manufacturers to capitalize on this significant domestic energy source while continuing to protect the environment.
The White House report also echoed the latest employment numbers from the U.S. Department of Labor (DOL), which indicated that, combined, manufacturing and mining have created the largest annual increases in employment in five years. An ACC study found that natural gas could produce tens of thousands of chemistry and supplier industry jobs in states that have been hit hardest by the recession, such as Michigan, Ohio, and Pennsylvania.
Economists Peter Cappelli and John Silvia believe these trends will likely continue in 2012, with other industries – retail, leisure and even construction – potentially benefiting as well.
Keep in mind, many of these are good chemistry and other manufacturing jobs. They are high-skilled and high-paying. And they are well within our reach in the near term, at a time when our economy could really use a hand to get back on its feet.