Energy boom to aid U.S. urban manufacturing jobs to 2020: report

[March 21, 2014]  By Lewis Krauskopf

(Reuters) — Energy-intensive manufacturing employment will increase by more than 1 percent a year in the United States through 2020, with 72 percent of those jobs going to metropolitan areas, according to a report released on Thursday.

The U.S. Conference of Mayors report on the economic impact of the domestic oil and natural gas boom said manufacturing employment in metropolitan areas has expanded by 1.7 percent per year on average over the past three years. It said energy-intensive industries such as fabricated metals and machinery were crucial parts of that growth.

Energy-intensive manufacturing sectors added more than 196,000 jobs in metro areas from 2010 to 2012, according to the report, which was prepared by IHS Global Insight.

"We're all aware of the incredible impact the energy revolution is having on our national economy," Virg Bernero, mayor of Lansing, Mich., and chair of the conference's advanced manufacturing task force, told reporters on a conference call. "The growing competitiveness and increase in employment from these manufacturing sectors are important to our cities and metro economies."

Manufacturing industries including steel, iron, fabricated metals and machinery have benefited from the natural gas boom, the report said. In U.S. metropolitan areas, employment in those industries all increased by 9 or 10 percent between 2010 and 2012, according to the report.

Speaking on the call, Waterbury, Conn., Mayor Neil O'Leary said savings from cheaper natural gas has helped manufacturers in Connecticut fund retraining programs. "All that equates to jobs," O'Leary said.

Environmental activists and some U.S. communities have criticized the removal of natural gas from shale in the ground using a process known as fracking, saying it pollutes groundwater and causes other problems.

Bernero said that, to his knowledge, the conference had no official policy on fracking.

(Reporting by Lewis Krauskopf)

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