The natural gas drilling boom spreading across the U.S. could spark a revival in U.S. manufacturing and may lead to more than 1 million jobs by 2025, according to a group of economists.
Robert McCutcheon, an economist with consulting group PwC, told The Cleveland Plain Dealer at a manufacturing summit in Cleveland that natural gas could provide manufacturing companies a cheap source of energy that ultimately could save them $11.5 billion in energy costs by 2025.
“If we save $11.5 billion, that’s investment capital that could be redirected elsewhere,” he told The Plain Dealer.
A study by PriceWaterhouseCoopers found low-cost energy could create as many 1 million new manufacturing jobs in the U.S. The report pointed to various projects, including several in Texas, as examples of an upward trend in the manufacturer sector.
“We believe that the factors are in place for these trends to continue, despite concerns and uncertainties over how, and to what extent, the United States should use its shale gas reserves,” the report concluded.
The report found inadequate infrastructure, current tax policies and uncertainty over the environmental impacts of hydraulic fracturing could hinder the rising trend in the manufacturer sector.
If a manufacturing revival does come to the U.S., Texas might be among the states that benefits the most from the change.
According to a survey by Pepperdine University’s Michael Shires, Houston, San Antonio, Austin and Fort Worth are among the top 10 cities who could power the manufacturing revival. Seattle’s aerospace sector helped power it to the top spot on the list.
Houston, which ranked fourth, is the third-biggest manufacturing center in the United States behind Chicago and Los Angeles, according to a Forbes story. It – like San Antonio and Fort Worth – made the list because of the booming energy sector.
The Bayou City also is one of the few cities who can boast about having more manufacturing jobs than before the recession. According to Forbes, Houston has seen a 0.5 percent rise in manufacturing jobs since 2006.
The number of jobs is likely to rise in the Houston area after Dow Chemical announced plans to build a new ethylene plant and Exxon’s plans for a multibillion expansion at its Baytown complex.
Both announcements in the past week will likely bring more energy-related jobs to the region, officials said.