As horizontal drilling has become more commercially viable, and with the increased push towards making the United States energy independent, the production of natural gas has exploded in the United States during the past few years. Recently, however, the bad press surrounding the hydraulic fracturing process, as well as the recent drop in oil prices, have lead to the popping of the fracking bubble.
While this may not seem important in regards to the energy jobs field as a whole, the results could be dramatic. This is a result of a compound of several factors all at once. First of all is the obvious one; as the bubble pops, all the lucrative new jobs that were created will disappear. This leads to a second devastating impact that can easily be overlooked; the recent surge in popularity in college degrees related to the field of hydraulic fracturing, such as petroleum engineering, will enter a job market that was a lucrative field hiring anyone who was even remotely qualified to one where the opportunities are sparse, and the wages are nowhere near as lucrative as before.
The shale oil deposits are quickly depleted, so as the easily accessible gas pockets are removed, new wells must be drilled at an increasing rate to maintain the same amount of natural gas being extracted. By 2020, the major reserves will be largely depleted, and by 2040 will be well below the amount predicted by the U.S. Energy Information Administration (EIA). This is compounded by the fact that half of the natural gas producers that were predicted by the EIA. This will accelerate the popping of the natural gas bubble as investors notice the major discrepancies that will appear between the overly optimistic predictions and the actually results, and will lose faith in the industry. This failure to meet the predictions will likely result in at least a slowing of hiring by the oil companies, if not outright layoffs, depending on the severity of the under performance and how much natural gas is actually extracted.
The disillusionment of investors will result in the investors selling their shares, which will cause the stock prices to drop. As this occurs, the oil companies will likely have further layoffs as they try to cut their losses. This will also cause an increase in the price of oil, which has many wider economic impacts that are outside the scope of this article.
Given all the factors, we can see that the natural gas industry is already in a decline, and, barring any major discoveries of extremely large natural gas reserves, is likely on it’s way to popping, with devastating effects on both the natural gas and energy job markets, as well as possibly the US economy in general, depending on how much of an impact the natural gas has had on the general oil prices when the bubble pops.