Will the Job Outlook be Great Again? (Part 2: Energy Extraction)

In my previous blog, I discussed the likely impact of the Trump administration on manufacturing jobs and concluded that he is unlikely to deliver on his promise of a renaissance in low-skill manufacturing jobs. Although in his campaign Trump gave the greatest emphasis to manufacturing, he also assured voters that he would boost employment in other industrial sectors. This blog is about another sector.

Energy Extraction. The government has considerable powers to regulate the energy-extractive industries: coal mining and petroleum. The majority of lawmakers in Donald Trump’s party have been saying for some time that global warming either does not exist or is not caused by human activities, and in doing so they have positioned themselves as champions of this industry sector. Although at times Trump has made vague concessions that there may be human causes, most of the time he hews to the more extreme version of the party line. He even tweeted that human causation is a myth concocted by the Chinese, although later he denied having said so.

 For both Trump and the Republican Congressional majority, two main policy recommendations result from this denial of the scientific evidence: (1) increased oil drilling and coal mining (“Drill, baby, drill!”); and (2) reduction or elimination of limits placed on carbon-releasing industrial activity (“Burn, baby, burn!”). Another result is encouragement of oil-pipeline construction, which has frequently been blocked by environmentalists.

Among the existing laws, regulations, and treaties that bind the United States to reducing carbon output, some will easier than others Trump and Congress to reverse. Trump has said he will “cancel” the Paris agreement, in which nations have promised to cut their output of greenhouse gases, and he can back out of this agreement by one of several ways. On the other hand, it will be difficult for him to roll back the regulations that make up the EPA’s Clean Power Plan and the fuel-efficiency standards for cars and trucks. To do so, he will need to propose alternative regulations and will face litigation from environmentalist groups that could delay or even block any changes. Any changes Congress wants to make will face possible filibustering from Democrats. If Trump and the Republican Congress succeed at rolling back regulations, it is possible that states will take a more active role. For example, California already has more stringent standards for vehicle emissions than the nation as a whole, and other states can adopt the California standards.

Market forces are already promoting the transition from dirty energy sources to cleaner sources. As cheaper natural gas has become available, power plants have been switching from coal to gas. The Energy Department found this transition the chief reason why carbon dioxide emissions in the first half of 2016 reached the lowest levels since 1991. During that period, in which the weather was relatively mild, consumption of coal fell by 18%, while consumption of natural gas fell by only 1%. Energy from renewable sources increased by 9% during that same period. Meanwhile, the cost of alternative-energy sources has continued to fall, and energy-saving consumer goods, including hybrid and electric cars, have become more affordable. If you haven’t shopped for LED light bulbs lately, you may be surprised at how cheap they have become.

Even if the government managed to walk away from the anti-carbon policies of the past few years, it is questionable whether market forces would allow the petroleum-extraction industry to expand and create jobs on a large scale. Employment in this sector was at 538,000 in October 2014 but is now at about 175,000 workers. Anti-carbon policies had very little to do with this slump. Instead, the main culprit was the glut of capacity that was created by America’s widespread adoption of fracking technologies, together with the development of new oilfields in other countries, such as Brazil. Opening up new areas (such as national parks and sensitive offshore ecosystems) for drilling will not produce a cornucopia of jobs as long as the glut of cheap oil and gas continues to make it uneconomical to set up new drilling rigs and pipelines.

Coal-mining jobs face a similar hurdle. Employment in 2015 reached the lowest levels since the Energy Information Administration began collecting data in 1978, and the number of mines decreased in all three major coal-producing regions.  The EIA reports (PDF) that between 2014 and 2015, “the average total number of employees at underground mines and surface mines  declined  by  13.6%  and  9.3%,  respectively.” More significantly, “the   average production per employee-hour increased by 5.4% to 6.3 short tons per employee hour.” Like the manufacturing sector, coal mining has increased its use of automation and other technologies for extracting coal more easily.  Coal is now extracted mainly by excavation from the surface (including mountaintop removal), using colossal machines operated by relatively few workers. In 2015, all of the top 10 coal-producing operations were surface extractions. The industry is vastly different from the labor-intensive days when Loretta Lynn’s father went to work with a pick and shovel down in a tunnel .

So the policies advocated by Trump (most of the time) and by the Republicans in Congress are unlikely to create a boom in employment in the energy-extractive industries. That’s not to mention the damage that these policies will do to the alternative-energy industries, to the extent that solar and wind power are still being subsidized.

There is one more wild card that may influence the energy-extraction policies of the new administration: Trump’s relationship with Russia. Oil and natural gas are Russia’s major exports, accounting for 68% of total export revenues in 2013. For reasons that are not entirely clear, Trump has made good relations with Russia a high priority. So although removing the barriers to petroleum output in the United States might create a limited number of jobs here, it would depress worldwide prices for petroleum and thus inflict a blow to Russia’s economy. Perhaps Congress will be less eager than President Trump to prop up Vladimir Putin.

Of course, unemployment in the oil patch and especially in the coal belt is no trivial matter that either party can afford to ignore. But the answer is not to turn back the clock on energy policy as if the energy markets and extractive technologies have not changed since the 1970s energy crises. Wayne Gretzky used to say that you skate to where the puck is going, not to where it’s been. As was true for manufacturing, the answer is to retrain displaced workers and train young people for the changed economy. But, as I pointed out in the previous blog, Trump and the Republicans are not advocating policies that will expand the availability of low-cost, high-skill training.

Will the Job Outlook be Great Again? (Part 1)

As a new presidential administration approaches, you may be wondering about the impact that the change in leadership will have on job prospects in the United States. I don’t claim to have a crystal ball, but I believe I can glean useful insights from what economists are saying and from past employment trends. And, in fact, I have a record of forecasting trends brought in by a previous sea change.

Eight years ago, when a major recession was looming and I was working for JIST Publishing, my editor—Susan Pines—assigned me to write a book that eventually was called 150 Best Recession-Proof Jobs. The book came out just as the full force of the Great Recession came crashing down on the U.S. economy. Thanks to this good timing, the book was so newsworthy that I was being interviewed on television approximately once a week for a month and more. (A lot of credit goes to JIST’s crackerjack publicist at the time, Selena Dehne.)

I selected the occupations that I featured as “recession-proof” by mathematically comparing the past ups and downs in the gross domestic product with the ups and downs in the workforce size of each occupation. Thus I was able to identify occupations that were least impacted by past downturns. The main limitation of this approach is that each recession is different from previous recessions. For example, the Great Recession was caused by a sudden drop in the value of real estate after a long bubble of overbuilding, so certain industries related to real estate—especially construction—suffered more than they did in previous downturns. Nevertheless, over the following several years my predictions were more often confirmed than disconfirmed.

The pending change in administrations presents a similar problem for those who would forecast employment trends. It might seem sensible to look at the employment effects of past transitions when a Democrat was succeeded by a Republican. However, each such transition, like each recession, is different in many ways. The year 2017 can’t be expected to repeat 2001 precisely. For example, while the last part of Barack Obama’s administration has seen a long streak of growth, it is not comparable to the technology bubble that ended Bill Clinton’s second term. And Donald J. Trump is not as conventional a Republican as George W. Bush.

In fact, it’s difficult to tell what kind of Republican—indeed, what kind of politician—Trump is. His policy pronouncements tend to lack specifics and frequently change depending on his audience. Some of the policy goals he has stated at various times run counter to the stated goals of Congressional leaders of his own party, raising the question of who will prevail if he tries to bend Congress to his will.

Because of these uncertainties, I am basing my forecasts on Trump’s general goals, plus an analysis of possible policies that he might or might not employ in pursuit of these goals. And I am organizing my forecasts by industries. In this blog, Part 1, I discuss only manufacturing.

Manufacturing Jobs. One of Trump’s most consistent messages has been his desire to bring manufacturing jobs back to the United States. What’s often overlooked in his rhetoric is that manufacturing output in the United States is now at nearly an all-time high. The kind of manufacturing that is now done here uses highly automated processes and employs a comparatively small workforce of highly skilled technicians. (Since recovering from the Great Recession by 2015, the number of employees has leveled off at about 12.3 million.) Most low-skill manufacturing tasks are performed either here by robots or overseas by low-paid workers, such as the ones who are making the garments branded with Trump’s name and his daughter’s.

That leaves the next president with these policy choices:

·         He might impose high tariffs that make it uneconomical for offshore manufacturers (whether American-owned or otherwise) to export to the U.S.  market—a policy that Trump has explicitly endorsed at times. But the policy could backfire. To the extent that imposing or raising tariffs is feasible under existing trade agreements, it would encourage other nations to retaliate with their own tariffs, reducing exports of our own manufactured goods and increasing the costs of the supply chain—imported parts and raw materials that U.S. manufacturers use. Also, once American manufacturers are protected from foreign competition and start hiring low-skill American workers, they will not be able to pay the rock-bottom wages that third-world workers earn. So, although many jobs will open in manufacturing, consumers will find American-made manufactured goods costing a lot more than the cheap foreign-made goods that now fill the shelves at Walmart. In summary, this policy would hurt high-skill manufacturing workers and create an economy where the low-skill manufacturing workers might have no more purchasing power than is now possible from work in service industries. And, finally, almost all Republican lawmakers, as well as many Democrats, are committed to tariff-free trade (although Republican voters have become more hostile to it), so this policy stands little chance of getting through Congress.

·          

·         He might mandate that American-made products and components be used when federal funds are expended. He hinted at this policy at the third presidential debate with Hillary Clinton when he said that he had used Chinese steel in one of his building projects because Congress had done nothing to stop him. It seems unlikely, however, that Congress would go along with this policy. Congressional leadership has not changed since House Republicans defeated an amendment to impose just such a mandate on infrastructure projects for the nation’s waterways.

·          

·         He might offer tax breaks to American manufacturers so that their operations here are more profitable. Trump actually tried this approach in October when he persuaded Indiana to give tax breaks to the Carrier division of United Technologies as a way of preventing jobs from being shifted to Mexico. However, Carrier has indicated that it intends to use the resulting savings to increase the company’s use of automation—thus subsequently cutting more low-skill manufacturing jobs. Cutting labor costs produces savings that are more dependable than easily-reversible tax breaks. So tax cuts seem unlikely to be an effective solution.

·          

·         He might reduce federal regulations on manufacturers that add to the costs of doing business in the United States. (I am not saying I favor this policy, but it is one that is sometimes proposed.) For example, it has been argued that the main reason Carrier wanted to relocate jobs to Mexico was regulations, not wages, and Trump is in agreement with Republican leadership in Congress on the need to reduce regulations on industry. It is not clear that Trump can get enough cooperation from Congress to make sufficient reductions in regulations to bring a true renaissance of manufacturing. And for some regulations (e.g., on the formaldehyde levels in plywood), the way to reduce competition by offshore manufacturers is to apply the same regulations to imports that are imposed on goods manufactured here, rather than rolling back regulations.

·          

·         He might accept the reality that low-skill manufacturing jobs are gone for good and instead focus on preparing (or retraining) workers for high-skill jobs in the industry. One way to accomplish this is to make community college as free of charge as high school. This is what President Obama proposed and that became the America’s College Promise Act of 2015, but Congress sent the bill to die in committee. I have been unable to find any statement from Trump himself about this proposal, but Trump’s campaign co-chair Sam Clovis, in an article in Inside Higher Education, stated that the campaign rejected the call for free community college.

·          

·         A related policy to encourage manufacturing would be to find a way to increase the number of manufacturing engineers working here. According to Walter Isaacson’s biography of Steve Jobs, the Apple  CEO once told President Obama that Apple’s suppliers in China are able to employ 700,000 factory workers because they have ”30,000 engineers on-site to support those workers. ‘You can’t find that many in America to hire.’” The skill level that Jobs was referring to seems to have been closer to engineering technicians than to what we normally think of as engineers. So, again, increased funding of community colleges and technology schools would be a way to achieve this goal, but that was not a priority of the Trump campaign. Alternatively (or additionally), a reformed immigration system might welcome engineers and engineering technicians trained abroad or coming from abroad for training here. Trump has both welcomed and rejected immigration of high-skill workers at various times. Congressional leadership has generally favored it despite the reluctance of many Republicans and therefore has sometimes had to find underhanded ways to encourage it. Therefore, it is difficult to predict whether or not this policy will be pursued in the coming administration.

·          

·         Yet another way to create a high-skilled manufacturing workforce is to encourage unions to partner with manufacturers on forming apprenticeship programs. Although Trump starred in a TV series called “The Apprentice,” I have not been able to find any statements from his campaign about his attitude toward actual apprenticeships, with the meaningless exception of a tweet he issued in October: “Did Hillary just say she wants more Apprenticeships? I created The Apprentice!” Judging by Trump’s past record as an employer, his attacks on an Indiana union leader, and his appointment of a foe of unions for Labor Secretary, he seems no friend of unions, and Congress certainly has not encouraged them, so this last outcome seems unlikely.

·          

In conclusion, then, I do not expect the Trump administration to deliver on its promise of a renaissance in low-skill manufacturing jobs. I expect employment in these jobs to remain at its current low level—or worsen if there is an economic downturn.

This Year’s Biggest Changes in Outlook

Early last month, the Employment Projections office at the Department of Labor released its projections for the decade from 2014 to 2024. Later in the same month, the BLS released the text of the Occupational Outlook Handbook (OOH), which was based in part on those projections. Both of these resources are updated every two years, and I thought you’d be as interested as I am in seeing which occupations have the forecasts that are the most greatly revised from the previous update.

The economic models that BLS uses are not foolproof. Sometimes new data comes in that makes the economists at BLS realize they have significantly overestimated or underestimated the growth an occupation can expect. The outlook may change for many reasons, such as new developments in technology, international trade, consumer tastes, or the formulas Medicare uses in reimbursing health-care providers. For an understanding of what may have changed, I find it useful to look at the “Job Outlook” section text of the OOH statement (article) about an occupation, comparing the wording in the previous edition to the wording that appears there now. (You can make the same comparisons by looking at the previous OOH edition stored in the Wayback Machine site.) But often it’s hard to find a good explanation of what accounts for the revised forecast.

A useful example is Wind Turbine Technicians. This is the occupation with the greatest increase in its projected growth: from a formidable 24 percent growth projected for 2012–2022 to an amazing 108 percent projected for 2014–2024. However, the OOH outlook wording has changed very little between the previous edition’s statement and the current edition’s. The major difference is that only the previous edition has this wording: “In addition, the Renewable Electricity Standard calls for 25 percent of U.S. electric power generation to come from renewable sources by 2025, which should further drive employment growth.” Although the new edition doesn’t mention the Renewable Electricity Standard, presumably this commitment is continuing to drive growth, but it’s interesting to note that the number of states with this standard in place has not increased over the past three years—both then and now, it came to 29 states, the District of Columbia, and two U.S. territories. A change that may be more relevant to the revised forecast appears in the wording regarding offshore wind turbines. The current edition lacks a cautionary sentence that appears in the previous edition: “However, the high cost of building wind towers in the ocean may inhibit new offshore projects from being approved.” Still, I wonder whether the cost of building offshore turbines has fallen enough to make this sentence no longer necessary.

I don’t want to make too much of this apparent disconnect between the greatly changed numbers and the mostly unchanged prose. The outlook section notes that this is a very small occupation (in fact, employing only 4,400 workers in 2014), so the sextupling of projected new job openings, from 800 to 4,800, still does not represent a large number of new opportunities.

Something similar seems to have happened with another small occupation, Forensic Science Technicians. In the past two years, its ten-year job-growth projection has soared upward from 6 percent to 27 percent. However, the OOH outlook section has changed little from the previous edition. In fact, the main difference is that only the latest edition offers this advisory sentence: “Larger police departments will be more able to staff full-time forensic science technicians, but they, too, may face budget constraints.” Again, both editions note that this is a very small occupation (with 14,400 workers in 2014), so relatively small changes in the economy can cause a large change in outlook without actually creating a comparably large number of new jobs.

Not all the occupations with greatly changed forecasts were those with small workforces. For example, Personal Care Aides (1.8 million workers) had its growth projection cut almost by half: from 49 percent to 26 percent. Yet, again, the text of the OOH outlook section shows almost no revision, except for the removal of the word “companionship” (as one of the functions of the occupation) in two places and the removal of this paragraph: “Clients often prefer to be cared for in their own homes, rather than a home care facility or hospital. Studies have found that home treatment is frequently more effective than care in a nursing home or hospital.”

Another large occupation with a big change in forecast is Market Research Analysts, which was projected to grow by 32 percent for 2012–2022 but only by 19 percent for 2014–2024. In the wording of the OOH outlook section, there is one hint of a reason for this change. The following sentence was cut from the current OOH: “Rapid employment growth in most industries means good job opportunities should be available.” This deletion reflects the overall downward forecast for job growth: The projection for all occupations changed from 10.8 percent to 6.5 percent. I compared the old projections with the new ones and found a mean (unweighted) change of -5.5 percentage points.

Nevertheless, for occupations that had greatly changed forecasts, I would appreciate a better indication in the OOH outlook section of what factors have changed expectations.

Here is a list of the 20 OOH occupations that had the greatest revisions (either upward or downward) in their projections for job growth.

Occupation	Projection for  Job Growth (Percent)
	2012– 2022	2014– 2024
Wind Turbine Technicians	24.5	108
Diagnostic Medical Sonographers  and Cardiovascular Technologists  and Technicians, Including Vascular  Technologists	38.8	0.2
Market Research Analysts	31.6	0.2
Nurse Anesthetists, Nurse Midwives,  and Nurse Practitioners	31.4	0.3
Geographers	29	-1.6
Mental Health Counselors and  Marriage and Family Therapists	29.1	0.2
Skincare Specialists	39.8	12.1
Insulation Workers	37.6	13.3
Medical Equipment Repairers	30.3	6.1
Political Scientists	21.3	-2.3
Meeting, Convention, and Event Planners	33.2	9.9
Personal Care Aides	48.8	25.9
Software Developers	21.9	0.2
Health Educators and Community  Health Workers	21.5	0.1
Surveying and Mapping Technicians	13.5	-7.6
Radiologic and MRI Technologists	21.2	0.1
Pest Control Workers	19.7	-1.2
Forensic Science Technicians	5.8	26.6
Nursing Assistants and Orderlies	20.9	0.2
Bill and Account Collectors	14.7	-5.6

Varying Reasons for Labor Shortages

Nobody wants to return to the recessionary days when large numbers of people were seeking job openings that didn’t exist. But neither is it good when employers cannot find workers to fill job openings—and this is happening in the labor markets for some occupations. The reasons vary.

One example is the market for airline pilots. Republic Airways Holdings, a regional carrier, last year reduced its fleet of 243 aircraft by 27 because of a lack of pilots. It expects to continue such cuts at least through the first half of next year.

Part of the blame for these cuts, according to Republic, belongs to new FAA regulations. One regulation raises the minimum number of hours of flight experience for most commercial passenger pilots. Another adds to the amount of rest time required for pilots, reducing their productivity.

But the Air Line Pilots Association says that the main reason for the shortage is the low pay that regional airlines are offering. In 2014, ALPA reported that for first officers, the starting pay averaged a mere $21,285. The association says that many pilots lost jobs because regional carriers went out of business, and these pilots would be glad to return if the wages were commensurate with their level of professionalism. Foreign carriers are offering much sweeter compensation packages.

A 2014 report (PDF) by the Government Accountability Office cites several additional factors. Reductions in defense spending have diminished the number of retired military pilots available for equivalent civilian jobs. Pilot jobs in general aviation (non-passenger flights) have experienced cutbacks, thus reducing opportunities for new pilots to accrue flight experience. And collegiate pilot-training programs are attracting fewer students in recent years—perhaps because of low pay in the industry. Thus there is concern that the pipeline of future pilots will not be able to provide the workers needed to replace those who retire because of age limits.

A completely different set of dynamics affects the labor market for agricultural workers, where shortages are also expected. Recently, a few states have passed laws making it easier for police to demand proof of immigration status and making it harder for businesses to hire workers who lack documentation. Citizens and immigrants with legal papers have not taken the place of these displaced workers, leaving many farmers without a way of bringing in crops. The American Farm Bureau Federation expected 2012 losses of as much as $9 billion as unpicked crops rotted in the fields.

However, a get-tough policy on undocumented immigrants is not the only factor contributing to the shortage of agricultural workers. In fact, many observers of this job market predict that even reform of the immigration system—which is stalled in Washington—will not solve the problem. Mexico, the source of most of our agricultural workers, is improving its education system and diversifying its economy—including expansion of its own agriculture industry— thus providing more opportunities for its people to find good jobs at home.

Two other occupations facing worker shortages are truck drivers and pizza delivery drivers. Manufacturers are expecting to have trouble finding skilled workers in the near future.

Worker shortages usually cause employers to bid up wages for the limited number of willing and able workers. None of the present shortages seems likely to reach the extreme that leads to dangerous inflation, and a modest amount of wage growth would be welcome in the present economy. Another response is for employers to apply appropriate kinds of automation, such as harvesting machines, and this usually creates good-paying jobs in fields such as engineering, programming, and machine maintenance.

The economy never reaches perfect equilibrium between supply of and demand for workers, and the current worker shortages are much less damaging than the job shortages of the recent recession years.

The Hookup Economy

You hear a lot about the “sharing economy” these days, but I think I’ve found a better term: the hookup economy. A job used to be like a relatively stable relationship between two parties, but nowadays many work arrangements are more like a hookup. The matches between employers and workers are made on the fly, there’s zero commitment from either party, and the connection is fleeting.

It’s hard to criticize Uber and Lyft on this account, because the relationship between a conventional taxi driver and a passenger was always ad hoc and short-lived. The same might be said about ZTailors, launched this week by George Zimmer (who used to tell you that “You’re going to like the way you look—I guarantee it”), which hooks up tailors with customers. But each week brings another Tinder-like app that matches up employers and workers, and some of these are meant to arrange work that used to be done by full-time payroll employees.

For example, Universal Avenue, a Swedish startup, helps businesses recruit salesworkers who work as freelancers. UpWork, Freelancer.com, and Guru.com are matchmakers for workers of many kinds, including designers, writers, engineers, and programmers. TaskRabbit lets you find workers for tasks that may not even fit comfortably into any occupation title, such as assembling IKEA furniture.

In favor of this trend, one might argue that the freelancers who work this way get paid for their time and (where relevant) skills, and they can have a flexible work schedule.

On the other hand, there are legal protections that one expects in an employer-employee relationship that are missing in these hookup work situations. Compared to a payroll employee, a hookup worker has much less legal protection from sexual harassment, racial or age discrimination, or a hazardous work environment (when the work is done on-site).

Listed on one’s resume, this kind of work also does not make much of an impression. This is less of a liability for designers, writers, and other workers who tend to display their output in a portfolio. But for most workers, a spell of doing hookup projects can look like unemployment on a resume.

Of course, doing this kind of work is better than having no income. And in today’s economy, this may be the only kind of work that some people can find. People who are downsized in their 50s or early 60s often have a particularly hard time finding an employer willing to take them on for a payroll job. So I think that hookup work is here to stay.

Which Boats Get Lifted Fastest by a Rising Tide?

The old saying goes, “A rising tide lifts all boats.” In today’s context, this means that the recovering economy should be improving the lot of all workers. I was wondering, however, whether some boats are rising faster as the tide comes in. In other words, which types of occupations are getting the biggest boost from the improving economy?

I decided it would perhaps be most revealing to look at the places where the tide is coming in fastest—the metropolitan areas that have seen the largest gains in real personal income. Thanks to a dataset from the Bureau of Economic Analysis, I was able identify 20 metro areas in which real personal income increased by more than 6 percent between 2011 and 2012. I then looked at the increases in wage-and-salary occupational employment, for each metro area, over the same time period. Rather than deal with hundreds of occupations, I looked at the increases for major groups of occupations.

Then I computed the correlations between these employment increases for occupational groups and the real-personal-income gains in the 20 fastest-rising metro areas. Here’s what I found:

Occupational Group	Correlation
All Occupations	0.71
Transportation and Material Moving Occupations	0.70
Life, Physical, and Social Science Occupations	0.69
Installation, Maintenance, and Repair Occupations	0.67
Construction and Extraction Occupations	0.59
Office and Administrative Support Occupations	0.57
Computer and Mathematical Occupations	0.53
Business and Financial Operations Occupations	0.51
Management Occupations	0.35
Sales and Related Occupations	0.30
Architecture and Engineering Occupations	0.29
Legal Occupations	0.22
Production Occupations	0.17
Healthcare Support Occupations	0.14
Healthcare Practitioners and Technical Occupations	0.04
Arts, Design, Entertainment, Sports, and Media Occupations	-0.04
Food Preparation and Serving Related Occupations	-0.05
Building and Grounds Cleaning and Maintenance Occupations	-0.09
Protective Service Occupations	-0.11
Community and Social Service Occupations	-0.17
Personal Care and Service Occupations	-0.31
Education, Training, and Library Occupations	-0.33
Farming, Fishing, and Forestry Occupations	-0.34

These results make more sense if you’re aware that several of the 20 metro areas that figure into these calculations are in the oil patch: Odessa, Texas (10.2 percent real-income growth); Midland, Texas (9.6 percent); and Victoria, Texas (6.9 percent); and Grand Forks, North Dakota (7.3 percent). The occupational groups that are growing fastest are those that are important for getting oil out of the ground and moving it to refineries.

It’s also interesting to note that some occupational groups that grew fastest nationwide over this same time period show low correlations to income growth in these metro areas. For example, Personal Care and Service Occupations grew by 5.3 percent nationwide, faster than any other group, yet it grew by only 1.2 percent in these 20 metro areas and shows a negative correlation with income gains there. Farming, Fishing, and Forestry Occupations grew at the same rate nationwide and in these 20 metros (4.4 percent), but it also shows a negative correlation to income gains there. Food Preparation and Serving Related Occupations actually grew faster in these 20 metros (4.4 percent) than nationwide (2.9 percent), but it also shows a negative correlation to income gains there.

These anomalies can be explained partly by the difference between the economies of these 20 metro areas and that of the nation as a whole. But understand that a rising tide of income in an occupation does not necessarily bring a commensurate increase in employment for the same occupation—at least, in the short run. In many occupations, income can rise because existing workers are able to put in longer hours. Eventually, the rising income should attract new workers, but there is always a lag because of barriers to job entry, such as licensure and other credentialing, plus (at the regional level) geographical distance.