Study questions long-term effects of energy booms

While the oil and gas boom in the West has boosted jobs in rural counties, the long-term impact of natural gas and oil production may be negative, decreasing per capita income, raising crime rates and lowering the share of adults with college educations, according to a study by Headwaters Economics, a research group that does such work in resource-extraction areas and has been skeptical of energy development.

Researchers reviewed data from 1980 to 2011, focusing on Colorado, Montana, New Mexico, North Dakota, Utah, and Wyoming, which produce "more than 75 percent of crude oil and more than 95 percent of natural gas in the contiguous West," according to the study. Researchers looked at the boom period from 1980 to 1982 "because it contained the highest share of personal income from oil and gas for each of the six major oil- and gas-producing states in the U.S," and compared those counties changes in per capita income, crime, and education in 1980-2011. (Headwaters Economics graphic: Durations of above-average oil and gas income, 1980-2011)

In counties that got more than 8 percent of their personal income from oil or gas in the 1980-82 boom and specialized in the field for more than 10 years, compared to similar counties with only one year of specialization, per capita income decreased by as much as $7,000 and the percentage of adults with a college education decreased as much as 2.5 percent. "These findings are consistent with other research that shows diminished socioeconomic benefit of resource extraction at the local level over time," the researches wrote. "The findings also support the theory that a resource curse has affected local areas that are specialized in oil and gas in the six energy-producing states in the U.S. West." (Read more)