Companies in the oil business sometimes struggle for capital. Others have to contend with tough terrain or harsh weather. And some are forced to cope with environmental opposition. But in North Dakota these days, the biggest obstacle to success is finding enough workers to do the job.
Bakken oil producers recently set a new daily average production record, but the numbers could be even better if more workers could be hired. The lack of available workers is the major constraint holding back the industry.
Lynn Helms, director of the North Dakota Department of Mineral Resources, said the industry wants to grow and would add more drilling rigs in the Bakken, but the workforce just isn’t there.
“It’s not capable of growing from where we are,” Helms said. “They can get people in here to run the rigs, but we’re still probably four to six frac crews short of where they would like to be. They’d love to hire another 500 to 600 people, but they’re not there.”
North Dakota’s 2.6 percent unemployment rate is among the lowest in the nation. The problem is the unemployment rate is low in other parts of the country too. And in a state like North Dakota where winter weather can be less than ideal, it means employers and the communities where they operate need to try even harder to attract workers. So what can North Dakota offer that other states don’t have? The answer is quality of life.
A study conducted by AE2S Nexus on behalf of the Western Dakota Energy Association and oil-impacted communities revealed quality-of-life issues that need to be addressed in order for the Bakken to successfully compete with other oil plays for workforce.
“Workers are finding comparable jobs with comparable pay in other shale plays with a lower cost-of-living that may have more moderate climates,” said Shawn Gaddie, AE2S Nexus division manager. “In order to compete with national oil and gas plays, North Dakota communities must continue to improve tangible and measurable quality-of-life aspects for their workforce.”
To address the need to compete, communities in western North Dakota have changed the way they think about promoting economic growth. Shawn Wenko, economic development director for the City of Williston, says nowadays he spends most of his time working on “things that make a city a city.” According to Wenko, people considering a new job and a new community are looking for more than an affordable roof over their head. He says they want a decent retail shopping sector, good restaurants, opportunities for recreation, quality health care, and top-notch schools. Williston and other Bakken communities are focusing more attention on those quality-of-life issues to make themselves more attractive to prospective employees.
Cities in North Dakota’s oil patch have added those amenities to help attract new workers and their families. Almost all have built new schools and community recreation facilities, and are working hard to expand their retail options. But it all comes at a cost, which only serves to emphasize the importance of state policies that continue to re-invest oil tax revenue in the communities that support the oil industry.
North Dakota legislators have gotten the message. There is a promising plan in the works for draft legislation that will assure oil-impacted communities have a dependable revenue stream to continue making improvements in their communities to compete for the workforce so essential to keep the industry and the state on the move. Let’s hope they follow through in 2019.by