Many Oklahomas are out of work and the economy is hurting.
“I have been worried for some time now,” said Russell Evans, Associate Professor of Economics, Executive Director, Steven C. Agee Economic Research & Policy Institute at Oklahoma City University.
Mainly because the oil and natural gas industry, the largest source of the state’s tax revenue is also hurting.
“It’s so strongly correlated with the state’s economy,” said Evans. “The state’s economy is in the exact same window. We’re somewhere less than a full health economy and somewhere more than being in recession.”
Evans says he’s concerned due to the continuous decline in drilling rigs across Oklahoma.
“I do think as you follow rig activity and you follow energy industry activity, you’re really getting a leading indicator of future state economic conditions,” said Evans.
Today, there’s 80 active rigs, compared to the 141 a year ago, which is something none of Oklahoma’s peer-energy producing states have seen this year.
Bottom line, drilling rigs are the barometer for Oklahoma’s overall economy.
When rigs are up and running, there’s more jobs and workers, meaning more Oklahoman’s are putting dollars back into the economy.
“Anytime you see rig activity the way it is, you know it’s affecting the regions that are not having the drilling taking place,” said Evans. “It’s affecting those diners, those hotels.”
The oil and natural gas industry hopes this grabs the attention of lawmakers before the ripple effect from drilling activity takes place.
“I’ve been pleasantly surprised that the state has managed to bounce along somewhere above recession for as long as we have,” said Evans. “I’m very much worried about downside risk.”
Source: The Petroleum Alliance of Oklahoma
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Editor’s Note: The story from the Alliance was written prior to the release of Oklahoma’s latest rig count of 75.