The state’s energy industry is powering the Wyoming economy’s bounce back from the Great Recession.
The industry has opened a slew of new mining jobs and fueled a big boost in the state’s taxable sales from energy industry purchases, according to state economic analysts.
“After a short but severe recession, Wyoming’s economy has turned around since the beginning of 2010, thanks to the robust rebound of the energy industries,” the Wyoming Economic Analysis Division reported in an economic summary issued last week.
The rapid growth of emerging markets around the globe — particularly in Asia — is boosting demand for energy, including coal exports and oil, according to the report.
Climbing oil demand and prices could create incentives for companies exploring for oil in the Niobrara Shale, which underlies part of Wyoming, while natural gas demand could climb as the nation’s economy recovers, the analysts said.
A surging mining industry in Wyoming added more jobs in the fourth quarter of 2010 — 2,130 jobs since the same period the previous year, an 8.8 percent jump.
The rising employment is tied to demand for coal, soda ash and uranium, while retirements in the coal industry continue to open spots for new workers, said Marion Loomis, executive director of the Wyoming Mining Association.
“An awful lot of the coal industry started when the initial mines developed, when the mines were started in the ’70s,” he said. “So they’re retiring.”
Coal companies, the largest sector in the state’s mining industry, produced 442.5 million tons in 2010, an uptick from 2009 but still below 2008’s all-time high of 467 million tons.
Mirroring the boost in production, purchases by the mining industry — which includes oil and gas businesses — was up sharply in the last quarter of 2010, state analysts said, growing 57 percent from 2009.
Taxable sales in Wyoming rebounded in the last quarter of 2010 to $4 billion, driven primarily by spending by the mining, oil and gas industries. The industry contributed to two-thirds of the 15 percent bump in sales from the same period in 2009.
Eight months into fiscal year 2011, or from June to February, sales and use tax collections were leading last year’s by $47.5 million, or 11.6 percent.
Sixteen of the state’s 23 counties and eight of the 11 major industry sectors reported gains when compared to last year.
Sales and use tax collections should level off as mining industry hiring slows, said Jim Robinson, senior economist for the state’s Economic Analysis Division.
“As job growth in the mining industry levels off, I would expect to see spending by businesses and consumers to be curtailed,” he said. “Ultimately, sales and use tax dollars will start to flow into the state at a slower pace.”
Meanwhile, oil and gas jobs fell to 16,100 in February, continuing a slide since December.
Bruce Hinchey, president of the Petroleum Association of Wyoming, blamed the job slide and flat production numbers on a slowdown in federal leases, lawsuits from environmental groups and a lengthy process to determine the environmental impact of drilling.
“We’re getting hammered all the way around on that,” he said.
The oil and gas job sector will rebound if there are new developments in the field, Robinson said.