In North Dakota: An Economic Boom

COMMENTARY Coal, Oil, Natural Gas

In North Dakota: An Economic Boom

Jun 27th, 2012 2 min read

Commentary By

Nicolas Loris @NiconomistLoris

Former Deputy Director, Thomas A. Roe Institute

Brandon Stewart

F.M. Kirby Research Fellow in National Security Policy

The flight from Minneapolis to Minot, N.D., was full of excitement and chatter. What fueled the passengers’ effervescent enthusiasm? Jobs.

North Dakota’s oil and natural gas boom continues to create employment opportunities, drawing all kinds of jobseekers from all parts of the country. Occupying the five seats around us on the 747 were an oilfield worker from Louisiana, a home developer from Florida, a truck driver from Mississippi, a restaurateur from New York and a welder from Arkansas.

In just four years, oil production has quadrupled in North Dakota. The state recently surpassed Alaska to become the country’s second largest oil-producing state, now trailing only Texas. That spells more work for geologists, engineers, rig workers, truck drivers and pipe welders. But it also means increased demand for restaurateurs, mechanics, salespeople, construction workers, etc. Not to mention increased revenue for flower shops — a symptom of husbands working away from home for two to three weeks at a time. The bottom line: oil and gas production is largely responsible for North Dakota’s unemployment rate being the lowest in the country.

From the Minot airport, we drove to our final destination: Tioga, a town of 1,200 which has been producing oil from the Williston Oil Basin since the 1950s. The town is enjoying rapid economic expansion, but like many other towns in the state, Tioga is also experiencing growing pains.

Housing development lags demand. When we asked what to consider before moving to North Dakota, the most common advice was, “Make sure you have a place to stay.”

This last winter was atypically warm, allowing some workers to live out of their cars or in poorly insulated trailers. But few count on being that fortunate with the weather next winter.

Developers who witnessed prior oil booms and busts in North Dakota had been reluctant to commit to building homes in the Flickertail State. Now, however, confident that oil production is here to stay, they are moving quickly to meet the housing demand. Meanwhile, those who own homes and/or land have seen their property values skyrocket.

Increased traffic and wear-and-tear on the roads has also upset locals to varying degrees. Some say they can’t stand the hassle. But most have adjusted to the change, with many saying they are excited to meet new people. With people arriving from all corners of the country, Tioga somewhat resembles freshman orientation week at college — so many fresh faces, and so many eager to make new friends.

Even with the life adjustments, an overwhelming majority of both the lifelong residents of Tioga and newcomers living in trailers stress that the economic benefits far outweigh the inconveniences. These are good problems to have.

As for the newcomers, everyone we met had zero regrets about starting over and building new lives. What mattered to them were the same two words, repeated many times: great opportunity. An opportunity to work again and earn good wages. An opportunity to provide for their families. And an opportunity to start a new chapter in their lives.

But it’s bigger than that. This is an opportunity to turn a new chapter for the U.S. economy. We have an abundance of energy beneath our feet, not just in North Dakota, but across the country. North Dakota demonstrates how we can develop our resources efficiently and in an environmentally sensible manner to create jobs in a wide array of sectors.

Tioga is a unique place. But its increased energy production, flourishing businesses and economic prosperity can be replicated in countless towns and counties across America.

Nicolas Loris is an energy and environmental policy analyst at The Heritage Foundation. Brandon Stewart is a senior producer at Heritage.

First Appeared in The Daily Caller