New Analysis: Pennsylvania-Made Natural Gas and Oil Drives U.S. Economic Recovery, Strengthens All Industries

HARRISBURG, PA, July 22, 2021—The American Petroleum Institute (API) and its Pennsylvania-based office (API PA) today released a new analysis of the natural gas and oil industry’s vast economic impact on the commonwealth’s economy and highlighted its importance to the state’s post-pandemic recovery. The study, prepared by PricewaterhouseCoopers (PwC) and commissioned by API, is based on the latest government data available and shows that Pennsylvania’s natural gas and oil industry supported nearly 500,000 total jobs across the state’s economy in 2019. Pennsylvania ranked among the highest states for the share of total economic contributions by the natural gas and oil industry, generating $78.4 billion toward the state’s gross domestic product—including $40.5 billion added to total labor income.

“This report clearly shows the natural gas and oil industry bolsters Pennsylvania’s economy and financial future, supporting hundreds of thousands of family-sustaining jobs and spurring economic and revenue growth across the state,” API PA Executive Director Stephanie Catarino Wissman said. “Pennsylvania and its abundant supply of shale gas has sustained our state’s economy while generating good jobs and cleaner, affordable energy. However, the state’s short- and long-term economic outlook depends on policies that support natural gas and oil development and critical energy infrastructure.”

Wissman also noted that Pennsylvania is the second-largest producer of natural gas in the U.S. and a key energy exporter.

“As America’s economy comes back, the natural gas and oil industry will serve as the foundation for long-term growth and prosperity in Pennsylvania,” API President and CEO Mike Sommers said. “Every state across the country – both blue states and red states – rely on American energy to fuel each sector of the economy and support millions of U.S. jobs. This study reinforces that Pennsylvania’s economic outlook is brighter when we are leading the world in energy production, and it serves as a reminder of what’s at stake if policymakers restrict access to affordable, reliable energy and make us more dependent on foreign sources.” 

As economic activity, travel patterns and consumption continue to grow during the post-pandemic recovery, the U.S. Energy Information Administration expects global oil and liquid fuels consumption to surpass 2019 levels in 2022. The PwC report reinforces how the natural gas and oil industry—in Pennsylvania in particular—is critical to economic revitalization and opportunities for job creation. According to the findings, in 2019, the industry directly and indirectly: 

• Supported 480,300 total jobs (102,500 direct and 377,800 indirect) or 6.1 percent of Pennsylvania’s total employment.
• Generated an additional 3.7 jobs elsewhere in Pennsylvania’s economy for each direct job in the state’s natural gas and oil industry.
• Provided $40.5 billion in labor income ($ 14.5 billion direct and $25.9 billion indirect) to Pennsylvania or 7.9 percent of the state’s total. 
• Contributed $78.4 billion to Pennsylvania’s gross domestic product ($39.4 billion direct and $38.9 billion indirect) or 9.7 percent of the state’s total. 

In 2019, the U.S. led the world in natural gas and oil production and the benefits of that leadership permeated throughout non-producing and producing states alike. At the national level in 2019, the natural gas and oil industry: 

• Supported more than 11.3 million total jobs (2.5 million direct and 8.8 million indirect) or 5.6 percent of total U.S. employment.
• Generated an additional 3.5 jobs elsewhere in the U.S. economy for each direct job in the U.S. natural gas and oil industry.
• Produced $892.7 billion in labor income ($318.6 billion direct, $574.1 billion indirect), or 6.8 percent of the U.S. national labor income. 
• Supported nearly $1.7 trillion to U.S. gross domestic product ($763.3 billion direct, $925.3 billion indirect), accounting for 7.9 percent of the national total.

Click here for more information on the economic impact analysis.

Click here for a copy of the report.

API Pennsylvania is a division of API, which represents all segments of America’s oil and natural gas industry. Our 600 members produce, process, and distribute most of the nation’s energy, and participate in API Energy Excellence®, which is accelerating environmental and safety progress by fostering new technologies and transparent reporting. The industry supports more than 10 million U.S. jobs and is backed by a growing grassroots movement of millions of Americans. API was formed in 1919 as a standards-setting organization and has developed more than 700 standards to enhance operational and environmental safety, efficiency and sustainability.