Pennsylvania manufacturing and the hard-working men and women of the commonwealth that it employs have long been the backbone to our state and nation’s economy. Steel produced in the Keystone State built the ships and planes that carried us to victory in World War II and our abundant raw materials have powered our nation and served in the building of our country’s critical infrastructure.
While Pennsylvania’s manufacturers have a storied, celebrated history, in recent decades our manufacturing sector has grown much slower than the national average and faces intense competition from other states and countries. But thanks to natural gas development, we have an historic opportunity to reverse that trend and usher in a new era for our region’s manufacturers.
That shale-driven manufacturing revival received a major shot in the arm earlier this month when Shell announced its commitment to construct a petrochemical facility in Beaver County. The facility will “crack” ethane borne from locally produced natural gas to turn it into ethylene — the primary feedstock for plastics, rubber, and other essential, everyday items.
Representing the largest investment made in Pennsylvania since WWII, this single project will have a significant and positive impact on our region’s economy as it’s expect to create 6,000 construction jobs and 600 permanent jobs once the facility is complete.
Additionally, and in some respects even more exciting than the cracker itself, is the potential for western Pennsylvania to attract downstream investment and even more jobs from manufacturers who use the resource to make everyday products.
Pennsylvania-produced ethane will feed a petrochemical facility in Beaver County that hopefully feeds manufacturers across the Ohio River valley to make everyday products. This sort of locally integrated shale supply chain would be transformational and it’s within reach given Shell’s commitment.
Importantly, these jobs are good-paying and are the sort of opportunity where one can work their entire career. Plastics manufacturing employees on average earn a wage 73 percent higher than the average American, according to a 2015 American Chemistry Council report. And for our region’s building trades and construction union members, this project will be a lifeline to good union jobs with family-supporting pay.
Indeed, Shell’s cracker facility — as the Beaver County Chamber of Commerce President Jack Manning said — is “a generational sea change for Beaver County” and a “once-in-a-lifetime investment” for the commonwealth.
The story of manufacturing’s comeback is the crown jewel of natural gas development. But for shale development, this facility — the first domestic project of its type to be constructed north of the Gulf Coast in more than two decades — would not have been possible. And while this plant is a significant win for the commonwealth and our region’s economy, Shell’s investment paired with continued, responsible development of our natural gas resources will drive even more supply chain businesses and manufacturers to expand and locate throughout the Appalachian region.
The fact is manufacturers require two principal inputs: an affordable, reliable source for energy and feedstocks. Combined with commonwealth’s world-class talent, manufacturing is on the comeback in Pennsylvania thanks to our region’s affordable and abundant natural gas supply.
Some call this the “energy advantage” and Pennsylvania manufacturers are capitalizing on it. In fact, a late 2014 PricewaterhouseCoopers analysis projects shale development will drive the creation of 930,000 manufacturing jobs by 2013 and 1.41 million by 2040.
The good news is that Pennsylvania is still in the early stages of realizing the benefits from shale development. But we need common sense policies that support and encourage job-creating natural gas production and manufacturing.
American energy supports American manufacturing jobs — that’s a policy where all sides should agree.
David Spigelmyer is the president of the Marcellus Shale Coalition and David Taylor is the president of the Pennsylvania Manufacturers’ Association.
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