In recent years, the U.S. economy has faced headwinds of uncertainty. But a recent article in The Economist finds the gusts of change are propelling the economy forward.
“Amid the gloom there are unexpected signs of boom, especially in energy,” states The Economist headline. One of the brightest “points of light” is natural gas from shale, the publication added. Production has released so much shale gas that “its price has tumbled,” the British weekly said.
That’s good news for the economy and energy producers, but best of all, for petrochemical companies that are building, re-opening, or expanding plants around the U.S. “It’s a huge morale-booster,” Dow Chemical’s site manager at a facility just outside New Orleans told the publication.
According to The Economist:
The biggest beneficiaries of the fibre-optic boom a decade ago were not the sellers of cheap bandwidth, but its users. In the same way, the biggest impact of the shale-gas boom will be felt downstream. It is a primary feedstock for ethylene, the building block of countless other products, such as plastics and tires.
The American Chemistry Council has counted more than $30 billion worth of publicly-announced new investments that will boost ethylene capacity by a third. ACC’s analysis suggests this could generate significant jobs, output and federal, state and local tax revenue.
The Economist takes note of just how high-paying these manufacturing jobs are: $50,000 for new hires, who can make as much as $100,000 a year with overtime.
And, if the chemical industry thrives and becomes more competitive globally, so does the rest of the manufacturing sector:
Petrochemicals are only the start. Industries as diverse as glass, fertilizer and plastic bags could all benefit from cheap, plentiful natural gas. Nucor, a steelmaker, is building a plant to make iron from natural gas and iron-ore pellets in Louisiana.
A recent article from the Pittsburg Post-Gazette made the same case for downstream energy economics. “A company that rents dunk tanks, snow cone machines and table linens doesn’t seem to have much to do with the Marcellus Shale natural gas boom.” But it does.