Despite the current downturn, the oil and gas industry continues to be a vital driver of Oklahoma’s economy, according to an updated report commissioned by the state chamber of commerce.
Released Wednesday, the study, “Economic Impact of the Oil & Gas Industry on Oklahoma,” reports that almost 150,000 Oklahomans earned $15.6 billion in wages or self-employment income from oil and natural gas activity in 2015, and that public education received $331 million in oil and gas severance tax revenue.
Among the many other positive impacts that the industry has on the state are oil and gas supporting an estimated $65.7 billion in total state output and activity in the industry supporting an estimated $28.6 billion in additional spillover output of goods and services in other industry sectors statewide.
The latter figure means that approximately 27 percent of total state household earnings are supported by the energy sector, according to the report.
“Looking at both the economic and tax revenue impact of the oil and natural gas industry, we can see that this sector continues to make a huge contribution to Oklahoma,” said Fred Morgan, president and CEO of the State Chamber of Oklahoma, in a statement with the report’s release.
“As the report update clearly demonstrates, even with the drastic price reductions we’ve seen in the past couple of years, oil and natural gas is still the most important contributor to economic growth in Oklahoma.”
This study was first conducted 2½ years ago, but an updated version was prepared for the State Chamber of Oklahoma in response to the extreme slide in prices and resulting revenue loss to the state. RegionTrack, an Oklahoma City-based economic research firm specializing in regional economic forecasting and analysis, prepared both versions.
“For policymakers, the volatile and ever-changing environment for oil and natural gas makes balancing the need for tax revenue with the desire to foster growth in the state’s trademark industry more challenging than ever,” said Mark Snead, economist and president of RegionTrack, who authored the study.
“The oil and natural gas industry remains the largest single source of state tax revenue, and important shifts have taken place in the types and amounts of taxes paid by the industry. The channels of economic influence on the state economy have also changed, as ownership and investment in the industry are now as important as employment and wages as a source of economic stimulus.”
Read the full story at the Tulsa World.