Did the gas industry create 100,000 jobs last year? > Check the facts

Did the gas industry create 100,000 jobs last year? > Check the facts

Who: “Australia’s natural gas industry created an estimated 100,000 jobs last year. This extraordinary effort is underpinned by around $200 billion worth of projects being built across the country right now.” Our natural advantage (Australian Petroleum Production and Exploration Association (APPEA) website)

The claim: That the natural gas industry created 100,000 jobs last year and is constructing $200 billion worth of projects right now.

The facts: According to the ABS in May 2013 employment in Oil and Gas extraction was 24,700 people. This has increased by 9,400 since May 2012. Note this includes those working in both Oil and Gas extraction. The number working in just the gas industry would be smaller.

According to the Bureau of Resource and Energy Economics (BREE) as of April 2013 there were 18 Liquid Natural Gas, Gas and Petroleum projects that had either money committed to them or were under construction. These projects have a total value of $205 billion.

BREE also has estimates for the number of construction jobs that these projects will create as well as estimates for the operating jobs when the projects are completed. The estimates are not complete because some projects do not have employment estimates. Those estimates that were available show that construction jobs totaled 35,500 and operating jobs totaled 7,600.

Discussion of evidence: The claim of $200 billion in projects can be substantiated from the BREE data.

The claim that 100,000 jobs were created in the last year is more difficult to substantiate. The ABS says the number of people employed in Oil and Gas extraction is 24,700, an increase of 9,400 employees in the past year, not 100,000.

It appears that APPEA is referring to construction jobs created by the $205 billion of projects. If this is the case then the 100,000 jobs are not permanent jobs but are temporary jobs that will disappear once the project is complete. The number of future operational jobs will be far smaller.

The available BREE data for construction jobs is incomplete, showing only 35,500 construction jobs for the eight largest projects of the 18 projects listed. These eight projects make up $179 billion of the $205 billion of projects or 87 per cent. If we assume they make up 87 per cent of construction jobs then all 18 projects would generate 40,805 construction jobs, still well short of the 100,000 claimed. Even when the 9,400 additional jobs according to the ABS are added the total is only 50,205 jobs.

APPEA provides no evidence for its claims. The claim that an estimated 100,000 jobs have been created in the last year seems unlikely based on available data. If the APPEA claim is to be taken seriously it needs to provide evidence for how this number was calculated.

Share Button