Economic impact of energy industry analyzed at Rifle symposium
Direct jobs supported by the oil and gas industry in six northwestern Colorado counties, or indirectly as a result of the industry, come to just under 11,000, or 6.6 percent of the total jobs in the region, according to Colorado Mesa University Professor Nathan Perry.
Perry spoke Thursday at the seventh annual Energy and Environment Symposium at Grand River Health in Rifle. His talk focused on the study he conducted last year, looking at the economic contribution of the oil and natural gas industry in the region’s Piceance Basin.
Beginning in early 2018, Perry began the report to provide an in-depth analysis of employment and other direct and indirect effects resulting from oil and natural gas activity in the region.
He looked at contributions such as supply-chain expenditures, employment and wages, several taxes, Federal Mineral Lease dollars, ad valorem taxes, sales tax and royalties.
Perry also explored direct effects, leakages, induced effects and supply chain effects when calculating his analysis.
The area he looked at was specific to Mesa, Garfield, Rio Blanco, Gunnison, Delta and Moffat counties.
The indirect effects he discussed, which include leakages, induced effects, and supply-chain effects, better show the impact the industry has on the economy as a whole, he said.
The study also shows the effect the oil and natural gas industries have on other industries in the region’s economy.
For example, hospitals employ 156 jobs resulting from the energy industry, while real estate, restaurants and physicians create 335, 570 and 96 jobs, respectively, according to Perry.
Perry felt there was a strong correlation between Piceance rig counts and employment, and found that Garfield County has the second largest employment impact with around 70 jobs per rig. Mesa County had the highest at 122 per rig.
The results showed that, for every additional rig, employment increased by 208 in the Piceance Basin.
“There is volatility in this sector, and the hope is the study provides local governments and businesses a planning tool to forecast for themselves based on rig counts and prices,” Perry said in a press release following the presentation.
At around $1.1 billion, Perry calculated that the industry’s contribution to the regional gross domestic product is around 9.2 percent.
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