~~~

Given the NFP release coming up on Friday, I thought it might be interesting to look at an obscure employment data point, via Jim Bianco:

CNN/Money Finding jobs in America’s Boomtown
Workers are landing jobs that pay six-figures in  the oil boomtowns of North Dakota. But the abundance of jobs and money  comes with some steep trade-offs, including a lack of housing and  extremely harsh winters. At 3.5%, North Dakota’s unemployment  rate is the lowest in the country. (Nationwide, the rate is 9.1%). But  among the small towns that lie along the Bakken oil formation, like  Williston, Watford City and Belfield, unemployment is just 1.5%.  Many  of the highest-paying jobs are at oil companies, where workers make an  average salary of about $100,000, often with little-to-no experience or  need for a college degree.  Halliburton, Continental Resources, Hess and  Whiting Petroleum are among some of the biggest players in the area.  And jobs include everything from working on a rig to hauling crude and  equipment in trucks to helping with administrative work, said Shawn  Wenko, workplace development coordinator for the city of Williston.  But  it’s not just the oil companies that are hiring. The oil boom has  brought such a big influx of people that every single industry — from  hospitality to retail — has been hit with overwhelming demand as a  result.

Source: Bianco Research, LLC

Category: Economy, Employment

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

28 Responses to “Where The Jobs Are”

  1. I heard the other night in the news that there are anywhere from 20 to 40 billion barrels of oil under ground in North Dakota. Can anyone confirm that from a source other than oil company shills?

  2. bm says:

    Article from the U.S. Geological Survey.

    http://www.usgs.gov/newsroom/article.asp?ID=1911

  3. christof says:

    I have blogged on this story as well early this year, more in the framework of the bank of North Dakota ; it is indeed something to analyse but most likely not so popular in the US in view of the fact that this bank is not a privately owned bank
    http://www.econoshock.be/fargo

  4. Joe Retail says:

    Well, I know that Saskatchewan (just to the north) is having an oil boom, and currently has the lowest unemployment rate in Canada.

  5. Investradamus says:

    I wouldnt call the USGS survey biased or intentionally misleading or anything like that, but I believe they severely underestimated the advancements technology and completion methods within just the last few years that are currently being employed in the Bakken/Three Forks – Sanish. What Phil likely heard, was Harold Hamm, CEO of Continental Resources, who, earlier this year, said that CLR currently estimates the EUR for the Bakken/TFS to be about 24 billion barrels.
    http://www.cnbc.com/id/44255518/CEO_24_Billion_Barrels_of_Oil_in_Bakken_Shale
    http://online.wsj.com/article/SB10001424052970204226204576602524023932438.html
    http://milliondollarway.blogspot.com/2011/01/24-billion-barrels-collaborating.html

  6. mappo says:

    The 1.5% are the meth dealers.

  7. gman says:

    It can’t be an expensive place to live either..but 100 in summer and 0 in winter tends to turn people off.

  8. BennyProfane says:

    I read recently that topless, er, exotic dancers were making a thousand a night up there.

  9. kms says:

    I get that right now in America it’s tough to find anywhere with low unemployment. But still, I wouldn’t really call a state with a super low population and an oil boom “where the jobs are.” North Dakota’s population is just shy of 700,000. You’d find more people in the greater Baton Rouge area (not even the biggest city in Louisiana, which is one of the smaller states in the Southeastern region). There are 14 million unemployed persons in the US (not counting recent graduates, discouraged workers or the underemployed). If a small portion, say 5%, of the typically classified unemployed moved to ND to find work, the state’s population would double. North Dakota would then need to add more than six times the number of jobs added by the whole economy in September just to tread water. That super-low unemployment rate would skyrocket, social services would be strained to capacity… things might even get all grapes of wrath-y. I understand that this is unlikely to happen, but it gets more likely every time someone touts North Dakota as “where the jobs are”. Now, I’m not trying to disparage this fine blog, North Dakota, its industries or the oil that we’re extracting there- I’ve been there recently, it’s a neat place- but a solution to our national unemployment woes, it ain’t.

  10. Niskyboy says:

    I was vigorous as a young man but now I’m in my 50s and sit on my butt all day at a desk with lots of job-related stress. As I watch my waistline expand I can’t escape the thought that it’s my brains and life force being dragged down there by gravity and solidifying. I bummed around out West when younger and have always wished I stayed somewhere out there in Big Sky country, instead of coming home, back East. Can’t tell you how appealing the thought is, of getting up out of this chair and working hard physically at some jobs like these, just doing manual work and not worrying about it or whether my job will still exist next year.

    Minus 40 without the wind would be a bit tough, however. Guess that’s why they pay so much.

    I will ask my wife if I can take off and go do this for a year, and will report back what she says.

  11. Futuredome says:

    I got a account manager position a couple of months ago in Ohio for a global consumer company. So much for the horrible economy!!!! It wasn’t like I had a great track record either.

    ~~~

    BR: Well, if an incompetent dolt such as yourself got an entry level position paying $24k per year, who are we to argue with that? The data must be wrong!

  12. dsawy says:

    “0 in the winter” is optimistic. 100 in the summer understates the heat a bit – it can max out at 105+.

    It can get much colder than 0 in North Dakota. Record lows are in the -40′s, and that’s rare, but -20F isn’t unusual.

    At -20F and below, life quits being fun real quick. I’ve been in temps as low as -47F, and you have to think about every move you make outdoors. Little mistakes that might only be an inconsequential annoyance in temps from 10F and up become life threatening at -20F and lower. At -30 to -40F, getting a diesel engine to start is very difficult, so they’re often just left running all the time. Getting a gas engine to start isn’t a thrill either, but it is far easier than a diesel. The first time people are stranded because their car won’t start or won’t run, it tends to put them off living in ND/MT/WY. They last one winter, then put the house up for sale and leave. See it all the time here in Wyoming. This past February, the minimum temp for Williston, ND was -33F, highest was 44F. Neither were records. 16 days had minimum temps that were sub-zero. January’s low was -27F, with 15 days of sub-zero minimum temps.

    And then there’s the wind. Lots of people don’t know what it is like to live where the wind blows pretty stiff most all the time. Max wind speeds can easily top 45MPH, with gusts over 50. Winds in the 20′s are very, very common.

    Whatever the actual recoverable oil in the Bakken formation, it is a large, economically viable formation of oil and natural gas. All over the area of Montana, ND, SD, WY and CO, there are large, economically exploitable oil and NG deposits, as well as CBM, coal, wind corridors, etc. There’s no shortage of work in these areas.

    If a guy shows up with a class A CDL, some welding skills a clean record and being able to pass a piss test, he’s probably got a job before nightfall. Show up with experience in remote sensing, rig operation, etc – he’ll have multiple job offers. Show up with an engineering degree and a eagerness to get out of the office and get dirty, you’ve got it made.

    Best leave hopes of a nice cushy job back on the coasts, tho. This is hard, dirty outdoor work. Sure, you can pull down six figures… but you’re going to work for it.

  13. ToNYC says:

    Field of Dreams out here. It was already there always until we/you find it and get busy. Have you read about the social history of the Sutter’s Mill discovery?

  14. gman says:

    To stick w/ the gold rush analogy..any indications of housing/food cost skyrocketing?

  15. sholland says:

    Teachers, state and city workers, and the likes have not seen an increase in pay, but they are still paying the higher costs associated the increased demand. $10 burgers and $1,500 a month rent for a tiny trailer? How can a teacher making barely $30,000/yr afford living there?

  16. realgm says:

    This should be expected.

    The future of the US is to produce real products. Not gambling with client money on Wall Street.

    Everyone should encourage their young family members to get into farming, agriculture, mining, and energy fields.

    Financial industry will shrink in the next 30 years. There are way too many MBAs in the world. Since there are so many supplies for MBA, I doubt most of them can make big money like in the last 30 years. I know a lot of engineering, science/math people getting into the financial industry thinking financial engineering and banking would give them big money. I doubt things would work out too well for them. Too bad they are late to the party.

  17. Investradamus says:

    @dsawy – Since you mentioned it, it honestly makes no sense to me how we have this stubbornly highly unemployment/underemployment situation, yet at the same time, we have significant labor shortages for skilled labor in E&Ps, mining, and other natural resource sectors (not to mention Ag labor).

    @realgm – How does one define an oversaturation of supply for MBA graduates? The percent of the population with a graduate degree is in the single digits. Of those with a graduate degree, maybe one third or one quarter are MBAs (can’t recall the exact number off the top of my head).

  18. Edoc says:

    And yet all of that recoverable oil doesn’t make any significant impact on gasoline prices. A shame.

  19. dsawy says:

    @Investradamus – the answer to your question is simple: People don’t want to get dirty, and they like regular schedules of pampered eight-hour days. That’s it in a nutshell. In the oil/gas/mining industry, you don’t have M-F, 8-5 hours, for example. Heck, in any of the sectors you mention, you will not see 8-5 (or other eight-hour shifts). Typical shifts will be 12 hours for four days, a couple to four days off, seven 12 hour days on another shift, another block of days off. In the oilfield, mining and pipeline fields, they’re pushing hard and fast. It is not unusual to put in 80 to 100+ hours per week. Guys like pipeline welders can put in 100+ hours *easily* per week.

    You get paid for this. This ain’t like my former life as a salaried engineer, where the boss says “Well, we have a customer emergency, can you stay late?” The next thing, you’ve done a week of 100 hours and you’re getting paid just the same as the guys putting in 40 hours. No, on these jobs, you’re punching a clock and if you’re punched in, you get paid. But if there is a rush on to meet production quota, schedules, or there’s been a wreck in the field, well, call the wife and tell her you won’t be home… for a couple days. The rate of divorce is high in these jobs.

    When we owned a farm, I had to scour the landscape looking for help. Most of the people who showed up at our front gate unsolicited had obvious substance abuse issues – crack, crank or booze, take your pick. The people I tried to recruit were usually failures. People simply didn’t want to work the hours required on a farm. When the crop has to come in, it has to come it, period. There is no “eight hour shift.” You work until it is done, period. There were times I had to push for 40+ hours with no sleep to get the job done in front of oncoming weather. People simply don’t want to work like that. They’ve become soft.

    Another thing that causes a lot of people to take a miss is the mobility of the job situation. If you hire on with a drilling, oilfield service, pipeline, etc company, you will be paid well, you will get good bennies and so on… but you will be put on jobs all over the US. Doesn’t matter much where you live. This month, you could be on a CBM drilling job in Wyoming… next month, you might be on a oil job in North Dakota for four months, after that, you might be down in Texas or Oklahoma. You can’t get home on your days off unless you fly, and it can take you most of a day to get to an airport from some of these locations.

    Lastly, there’s the issue of whether or not applicants will fit in with the crew. This is dangerous work. If you’re an accident prone type of individual, or you lack situational awareness, the crew will probably talk to the crew chief or boss after a couple weeks and say “Nice guy. It would be nicer if he were somewhere else.” Accidents on drilling rigs, in mines, etc can get people killed, and sometimes the guy who screwed up kills more than just himself. 50 years ago, most all young men had some notion of mechanical skills. Today, there’s a whole lot of young men literally who don’t know jack about mechanical equipment – get them around heavy equipment they’re one moment away from being a red greasy spot on the ground. I continue to be in amazement of how many young men cannot drive a standard transmission vehicle, for example. They’re utterly clueless – they have to be taught really, really simple stuff, never mind the more skilled stuff that used to be simply assumed. When the boss says “Move that service truck (like a pickup, only with a welder/compressor/crane on it) from there to here” and the new guy jumps in and has no clue how to shift a manual tranny… it’s all over in a hurry.

  20. Niskyboy says:

    She said, “I can think of a place you should go that’s a lot warmer than North Dakota.”

  21. Kris Winn says:

    While the salary may be attractive, concern for safety and living conditions are the most important factors to consider. The article made mention of administrative roles (which are likely the safer jobs), but I am sure those positions are very limited. Most of the work force will be doing manual labor.

    People willing to use less brain power and more physical energy will benefit from the pay. Unfortunately, a great deal of them will also be living out of their rigs in the process.

  22. HungryHoneyBadger says:

    Maybe the Occupy Wall Street people should charter a bus and head to the Dakota….

    Not the one where Lennon was shot.

  23. wunsacon says:

    Niskyboy, LOL! Yeah, I wonder about ditching the desk job, too. But, ND? No way…. Are there any shale discoveries near Sausalito? Now, that I could enjoy.

  24. wunsacon says:

    Mr. Ritholtz, you have it all wrong. Just like Texas, the ND job market is booming because of the low taxes. Doncha know?

  25. Greg0658 says:

    interesting thread & I checked the .gov site 1st thing this morning .. I could/might wonder if this mining operation is another Solyndra ie: all work and no real world output (until the base investor is busted out) I didn’t see cost per barrel anywhere (at stages of development) just a couple terms 1 being “technically recoverable oil”

    that said I’m all for extracting our resources and hiring local .. because the “Multiplier” is most mostest .. and we have to get the wells in 1st before them Canadians diagonally drill and get it

    dsawy’s sage piece up there .. I’ve been in them construction holes (early life days) so I hear ya on brains/stamina/common sense .. I’ll add our line soldiers make the Americans are fluffy a bit hollow (as well as laborers in many trades here) .. in defense of the fluffy Americans > the world* (generally) is provided for like no other time in human history EXCEPT in perceived quality of life financial longevity WHAT is the reason behind that ? maybe kids want the theHappyDays 50s back and you can stick this new minenium world .. dsawy I’m not picking for a fight .. your right but the kids gotta feel the love not the kick in the shin ..

    and what is it with all this overtime and unemployment ? what is it with these McMansions and real laborers living in temp trailers for a short gig to send 1/2 the money to the honey back home and the other 1/2 to the location location location feeding you at the gig ? imho you capitalist need a kick in the shin to wake tfu .. or maybe you capitalist are right and people just need to starve to death to right the ship

    *coda – population growth makes that statement a bigger challenge by the day

  26. Futuredome says:

    Uh, BR. It was a entry level position, but it sure was more than 24000. I run major accounts my friend.

  27. kms says:

    @investradamus

    Unemployment is a magnitude problem.

    There just aren’t 4 million jobs just lying around in those industries (leaving just 10 million unemployed). If these industries were big enough, this could constitute structural unemployment (something unemployed construction workers could be retrained to do), but they aren’t. They could be, but we have let a lot of our natural resource exploration occur elsewhere in the world. Not a terrible strategy… since we can ramp up production now- when people are desperate for jobs (cheap labor) and the prices are super high. But correcting the imbalance is a matter of years maybe decades.

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