Report: Energy-intensive industry good for economy

March 25, 2014 | By Barbara Vergetis Lundin

The energy revolution, including inexpensive natural gas, will boost manufacturing growth in the U.S. and its metropolitan areas, according to a report by IHS Global Insight.

"We believe the energy revolution is helping the U.S. regain its footing in the manufacturing sector," said Lansing, Michigan Mayor Virg Bernero, chair of the U.S. Conference of Mayors Advanced Manufacturing Task Force, the organization that commissioned the report.

Energy-intensive manufacturing industries, including fabricated metals, machinery, and plastics, are helping the national economy rebound from the recession, especially in metropolitan areas, according to the report.

"The energy-intensive industry, in particular, has been a key component in the manufacturing expansion and has played a key role in the country's overall economic recovery," said Waterbury, Connecticut Mayor Neil O' Leary, vice-chair of the USCM Manufacturing Task Force.

Over the last three years, metro area manufacturing employment has expanded by an average annual rate of 1.7 percent, with energy-intensive industry playing a key role, according to the report. The report also projects that energy-intensive manufacturing employment will expand by more than 1 percent annually nationwide with 72 percent of those jobs coming in metro areas through 2020.

The research reports that from 2010 to 2012, energy-intensive manufacturing sectors added more than 196,000 jobs and increased real sales by $124 billion in the nation's metro areas. In 2012, metro economies accounted for more than 78 percent of the total employment and 82 percent of the real sales in energy-intensive manufacturing industries.

Expanded demand for new pipelines and mining equipment has resulted in a 17 percent increase in real sales, and a 9.7 percent increase in employment (2011-2012) in steel, iron, fabricated materials and machinery manufacturing in metro areas. Increased availability of natural gas and oil has resulted in a surge in plastic, rubber, resin and chemical manufacturing, and a 2.6 percent increase in employment within metro areas, the report says.

"This emerging sector provides essential goods and equipment directly to consumers as well as to a wide range of industries, including energy production," said Mayor Bernero. "Increased focus on this sector will boost overall productivity in a city and connect skilled workers to high-wage jobs. More and more, manufacturers are relocating to America's cities, where the infrastructure and intellectual capital drive productivity and innovation."

For more:
- see this report

http://www.fierceenergy.com/story/report-energy-intensive-industry-good-economy/2014-03-25