Economic report: Wyo rides high on fossil fuels
To state the obvious; Wyoming’s economy rides high on fossil fuels, and it crashes with them, too.
I just opened Headwaters Economics’ new 102-page report, “Fossil Fuel Extraction and Western Economies,” released today, and it’s a must-read for Wyomingites. Some highlights: The value of oil and natural gas produced from 2003 to 2008 in five Rocky Mountain states — Wyoming, Montana, Utah, Colorado and New Mexico — was more than $300 billion. While energy sector jobs are among the highest-paying, they’re also just as volatile as the up-and-down commodities they produce.
“In the recent recession, mining, including energy development, fell hard and fast: compensation for mining employment shrank by the largest percent (16.1% decline from 2008 to 2009 in the five-state region) of any economic sector,” according to the Headwaters Economics report.
In a conference call this morning, Headwaters Economics policy analyst Julia Haggerty said Wyoming is good at saving money from fossil fuel extraction, referring to Wyoming’s Permanent Mineral Trust Fund. However, it could save more. She said the study suggests Wyoming is over-reliant on using sales tax to address impacts from energy development.
“In theory, that should be banked away for a rainy day,” said Haggerty.
The report also addresses an issue that’s been a sore point for all Wyoming for decades: severance taxes. Just as Wyoming’s infamous “Gerking report” found, the amount of severance tax levied on fossil fuel extraction is not a driver of energy-related jobs.
“Jobs respond closely to price,” said Haggerty. “They (states) should maximize this collection opportunity.”
– Dustin Bleizeffer, WyoFile editor-in-chief, [email protected]