Monday, June 04, 2012

April Jobless Rate Falls to 0.7% in the ND Oil Patch

The state of North Dakota reported last week that the jobless rate in both the city of Williston and in the surrounding Williams County fell to an eye-popping low of 0.7% in April (see chart above), the lowest jobless rate ever recorded in North Dakota history, and possibly the lowest jobless rate in history for any city or county in the entire United States. Also in April, there were ten North Dakota counties with jobless rates below 2%, and all of those ten counties are on the western edge of the Peace Garden state in the oil-rich Bakken region (see map below).  If there were ever any doubts about the potential that domestic energy production has to create shovel-ready jobs, the 0.7% jobless rate in the heart of the Bakken region in North Dakota seems like pretty convincing evidence that those doubts are without any foundation.
  
Click map to enlarge.

14 Comments:

At 6/04/2012 2:27 PM, Blogger Jon Murphy said...

While this is a good sign for Bakken et al., that 0.7% worries me a little. If more workers do not move to the area, it could arrest the development of the oil field. Frankly, I'm not comfortable with an unemployment rate below 3%.

 
At 6/04/2012 3:06 PM, Blogger Bruce Hall said...

Jon

Try California for comfort.

 
At 6/04/2012 3:13 PM, Blogger Rufus II said...

Don't worry; probably the biggest company drilling in the Bakken, Occidental Petroleum, announced last week that they were pulling out - reason given: Couldn't make a buck.

 
At 6/04/2012 3:21 PM, Blogger Les Johnson said...

They can't find people...

The problem in the Bakken is finding workers in a sparsely populated boomtown. The current pace of drilling activity has “basically overwhelmed the small place,” he said.

 
At 6/04/2012 3:27 PM, Blogger Mark J. Perry said...

"Occidental Petroleum Corp. is reducing its exposure in the Bakken because of stubborn operating costs, but the company insists it still has long-term plans for the region."

Not exactly "pulling out"....

 
At 6/04/2012 3:27 PM, Blogger Unknown said...

This is why oil plays closer to populated areas like the Utica shale and the Eagle Ford shale will have better luck, at least in the workforce department.

Speaking of the Eagle Ford ...

Eagle Ford banks challenged as deposits skyrocket

 
At 6/04/2012 3:27 PM, Blogger Jon Murphy said...

Don't worry; probably the biggest company drilling in the Bakken, Occidental Petroleum, announced last week that they were pulling out - reason given: Couldn't make a buck.

Rufus-

I heard Occidental was reducing rig count due to high operating costs, but they still had long term plans and weren't withdrawing completely. At least, that's what Petroleum News was reporting ( source

 
At 6/04/2012 4:00 PM, Blogger Breaker Morant said...

Rufus>>>Don't worry; probably the biggest company drilling in the Bakken, Occidental Petroleum,<<<

I would ask you to back up your contention that Occidental is the biggest in the Bakken. But it can't be backed up because such a contention is so far from reality that it is simply laughable.

 
At 6/04/2012 4:01 PM, Blogger Breaker Morant said...

This comment has been removed by the author.

 
At 6/04/2012 4:03 PM, Blogger Unknown said...

The company with the most rigs and acreage in the Bakken, I believe, is Continental Resources.

I think Occidental is maybe medium-sized.

 
At 6/04/2012 4:19 PM, Blogger VangelV said...

Don't worry; probably the biggest company drilling in the Bakken, Occidental Petroleum, announced last week that they were pulling out - reason given: Couldn't make a buck.

While that is not totally accurate, I wonder if the promoters really have much perspective on the scale involved

At the time, the company said it expected to grow Williston basin production to at least 30,000 barrels of oil equivalent per day (from 6,000 boe per day) within five years.

Notice that is not 30,000 barrels of oil per day. That is 30,000 'boe' using a 6:1 energy ratio when the price ratio is over 30:1. And notice that the company was selling conventional assets (in a politically questionable area) to buy assets that have geological and political questions.

 
At 6/04/2012 5:29 PM, Blogger Henry H said...

The 0.7% unemployment rate means many employers must not be drug testing in the area. You would have to try real hard to not get hired in ND.

 
At 6/04/2012 6:16 PM, Blogger MikeK said...

Interesting. A lot of counties with similar unemployment rates nowhere near Bakken. I wonder if you overlaid the map with one that pinpointed Indian reservations it wouldn't actually be a better indicator than oil drilling...

 
At 6/09/2012 1:16 PM, Blogger james said...

The job situation today poses an interesting question for those on both the left and the right. Why is it or how can it be that companies in the standard and poors five hundred are seeing their earnings soar while at the same we are seeing such animic job creation by the private sector. The answer technology. Labor saving technology and also the increasing ability of many companies to move not just physical production overseas but also white collar jobs overseas. What we have here is a very serious dilemma on the one hand increasing productivty can keep prices down their by keeping inflation in check. But theirs a problem in our economic system. If a company is profitable and productive they could use their increasing productivity to improve both wages and benifits of their employees and they could also use their increasing productivity to lower prices or at least not raise prices. On the other hand they could use their growing excess profits which are directly related to their increasing efficiency and productivity to buy back their stock pay a larger dividend and do acquisitions or just hold the cash on their balace sheet. Rather than increase and improve the wages and benefits of their empolyees and lower or hold prices of their products and services steady. I believe the vast majority of the businesses in the united states have chosen to do the latter. In order to expect companies to pass on their excess profits in the form of lower prices or stable prices we must see increased competition among firms in the same business. This is often absent. Look at the huge money center banks that have a hold on huge regions of the country. With fewer competitors these companies can keep much of their excess profits instead of being forced to pass them along to consumers.. Another factor that is at work here is the tremendous amount of competition for jobs in the labor market as long as unempolyment remains high many companies are not inclined to increase wages and improve benefits. In the end we have a growing mismatch between the ability of the average consumer to afford the products and services being provided to the consumer by business.

 

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