Pennsylvania's share of Marcellus shale jobs dips
Pennsylvanians made up a smaller share of new workers in the local shale gas industry in 2012, according to industry data released on Wednesday, underscoring a shift here from drilling to pipeline work.
State residents accounted for 56.8 percent of new hires among drillers, pipeline companies and contractors in the Marcellus Shale Coalition. That's down from 72 percent the year prior, according to annual surveys the group does of its workforce.
Regional trends are working against Pennsylvania. Drilling rigs have left parts of the state for gas fields in Ohio, which contributed 19 percent of the new workforce in 2012, up 6 percentage points. Pennsylvania also has shifted to more pipeline work and doesn't have the skilled welders that sector needs, said the coalition's John Augustine.
“It's kind of like shale 101 happening again,” said Augustine, who coordinates the coalition's workforce committee that surveyed 101 companies. “Four years ago, we saw the same trend with (drillers), and now we believe we're seeing the same trend with the (pipeline) segment.”
The industry has been widely criticized for importing workers to fill shale jobs — especially for higher-paying technical and skilled positions — and has blamed the lack of experienced workers. But the state and the private sector ramped up programs to equip local residents with the needed training and skills.
Augustine said that pipeline work requires a different set of skills, such as welding, and years of experience. Generally, he said, it is 15 to 20 years for pipeline welding. But he was optimistic that hiring will pick up once residents received the required training.
“Such welding skills are critically important,” said Penn State economist Timothy Kelsey. “If it isn't done properly, this is a huge safety issue. So it is good that the industry is having people do the welding who know what they're doing, irrespective of where they live.”
The last 18 months also have brought a transition in the gas industry in Pennsylvania. Once marked by unfettered growth, industry hiring moderated as companies trimmed costs because of low prices for the gas they sell.
The industry has shed jobs in 2013, down about 1,100 workers through June, according to data the state Department of Labor and Industry released July 30. It had 36,100 employees — more than half of whom are Pennsylvanians, department spokeswoman Sara Goulet said.
The state's losses could continue this year, too. Coalition members reported that Western Pennsylvania and Ohio are likely to be the two prime sources of about 4,000 new hires they expect to make for work in the Marcellus and Utica shales.
State officials have not researched what's behind the trends, Goulet said. More than 70 percent of its new gas industry hires came from within the state just two years ago, she said.
Nearly half of the drilled wells in the state had not been producing at the end of 2012, a sign the industry needed to get more pipelines to connect wells to markets, experts have said. The pipeline workforce is often transient, with specialty workers traveling the country, setting up camps for weeks or months at a time to do a job. It makes sense that the industry imported talent for the work in Pennsylvania, Kelsey said.
As drillers scrambled to create a new industry from scratch, as many as 70 percent to 80 percent of the workers came from outside Pennsylvania, according to research Kelsey helped assemble in 2011 for the Marcellus Shale Education & Training Center.
That has changed, in large part because hiring local workers benefits the industry, experts said. It's cheaper to have a local workforce than to have to pay people to relocate. Coalition members want to do that only as a last resort, Augustine said.
“When you're trying to hire a lot of people quickly, it's impossible to source those jobs locally,” said Chris Briem, a regional economist at the University of Pittsburgh. “Eventually, folks do gain the skills on the job or in training programs.”
The government and private sector have spent millions of dollars to bolster local training programs. The federal government has pumped $20 million from 2010 to 2012 into the ShaleNet consortium of organizations, including Westmoreland County Community College.
Pittsburgh Technical Institute this year broke ground on a $3.5 million center in North Fayette that will house classrooms and labs for teaching its oil and gas program, including welding. It got a $750,000 state grant.
The coalition does its annual survey in part to help build those programs, Augustine said. It has a committee of about 40 human resources executives who collaborate on industry trends, and then talk to technical schools and colleges about how they can tailor their education programs to openings in the industry, he said.
“We need these people; the schools are training these people. How do they know what to train if we aren't telling them?” Augustine said.
Timothy Puko is a staff writer for Trib Total Media. He can be reached at 412-320-7991 or firstname.lastname@example.org. Staff writer David Conti contributed.
Show commenting policy
TribLive commenting policy
You are solely responsible for your comments and by using TribLive.com you agree to our Terms of Service.
We moderate comments. Our goal is to provide substantive commentary for a general readership. By screening submissions, we provide a space where readers can share intelligent and informed commentary that enhances the quality of our news and information.
While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective. We will make them as carefully and consistently as we can. Because of the volume of reader comments, we cannot review individual moderation decisions with readers.
We value thoughtful comments representing a range of views that make their point quickly and politely. We make an effort to protect discussions from repeated comments either by the same reader or different readers.
We follow the same standards for taste as the daily newspaper. A few things we won't tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. Don't include URLs to Web sites.
We do not edit comments. They are either approved or deleted. We reserve the right to edit a comment that is quoted or excerpted in an article. In this case, we may fix spelling and punctuation.
We welcome strong opinions and criticism of our work, but we don't want comments to become bogged down with discussions of our policies and we will moderate accordingly.
We appreciate it when readers and people quoted in articles or blog posts point out errors of fact or emphasis and will investigate all assertions. But these suggestions should be sent via e-mail. To avoid distracting other readers, we won't publish comments that suggest a correction. Instead, corrections will be made in a blog post or in an article.
- Stocks wrap best week of year with slight gains
- Uncle Charley’s Sausage expands sales to Maryland, Virginia
- CMU showcases its lengthy list of fledgling companies at venture event
- PNC fined for paperwork errors on municipal bond offerings
- Other segments nudge Alcoa to slim profit
- 2,000 more layoffs at U.S. Steel debated
- Rice, Gulfport team on Utica shale pipeline system
- Sluggish wage growth may sap retail spending during winter holidays
- Alcoa supplying parts for military jets under $1.1B pact with Lockheed Martin
- Fed insight gives stocks room to run; S&P 500 regains 2,000 mark
- Last-minute China worries derailed Fed’s rate hike plans, minutes reveal