The American energy boom ignited by technological developments in reaching shale deposits and the increase of natural gas production is set to make America energy independent by the 2030s, giving rise to a renaissance in American manufacturing. Such a boon will be most evident in manufacturing jobs directly connected to the energy industry, such as construction and machinery, as well as those industries affected most by the energy industry because of their high energy needs.
A recent report by the U.S. Conference of Mayors is full of good news for the immediate future of manufacturing in American cities, asserting that the growth of the industry has been crucial in the economic recovery of the last five years and centered mostly in metropolitan areas, a traditional base of the industry. According to the report, energy-intensive industries have been a crucial factor in the rebirth of American manufacturing. The increasing availability of natural gas and oil led to one of the most dramatic rises in the manufacturing industry in the last two years in industries such as plastics, chemical and rubber. The steel, iron and machinery industries also showed substantial growth given the growing need for pipelines, mining and new refineries. Cities including Chicago, Houston and Baton Rouge have benefited most from the energy boom.
Over the next decade, the rise in manufacturing jobs will continue to expand among energy-related industries at a rate that will surpass almost every other industry. This is partly due to the increasing accessibility and cost-effectiveness of new forms of energy, most crucially shale and natural gas, as well as more environmentally conscious forms of energy like wind and solar. It is also due to the trillions of dollars that energy industry experts predict will be invested in the next 10 years, increasing production and delivery effectiveness, lowering consumption prices even further and perpetuating the energy boom.
Such energy independence will have a major impact on trade deficits, given that a large part of such deficits are the result of the country's current dependence on foreign oil. Lower trade deficits will benefit the economy across the board. The refurbished and reborn American manufacturing industry will be one of the major benefactors of such an energy boom.
Such welcome reports about future American energy independence and its effect on American manufacturing industries, which have gone through more of a quarter century of decline, will of course not be good news to economies that will be significantly affected by the disappearance of oil exports to the United States. Even neighbors like Canada and Mexico, with which the United States has trade agreements, will be inversely affected by the U.S. energy boom.
Other issues, such as concerns that shale and natural gas production will draw investments from renewable resources that would create a more perpetual American energy independence, are important to consider for the long term. Yet, the current energy boom no doubt signals a growing American strength in the next two decades that will be most evident in the dramatic rebirth of American manufacturing.
(Photo courtesy of Samuiblue / freedigitalphotos.net)
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