In Boom Areas, Oil and Gas Extraction May Lead to Lower High School Completion Rates
A 2018 article published in Resource and Energy Economics investigating the effects of the oil and gas boom on schooling decisions in the US revealed a negative impact on high school enrollment in counties with intense drilling activities. Researchers found the decrease in enrollment was worse in counties with younger compulsory schooling age, and in non-metro counties with a tradition of mining or persistent poverty. In the 1170 counties of the 15 states observed while undergoing oil and gas booms, 41,760 fewer students enrolled annually in grade 11 and 12.
For this study, data was collected between the years 2000 and 2013 from counties in 15 states, including Pennsylvania, selected based on the 2011 US Energy Information Administration shale plays map. Conclusions were drawn based on matching well data with school enrollment data from state education agencies. Overall results reported a decrease in 11th and 12th grade enrollment in counties and years with intensive drilling activities, and researchers were able to further distill data based on a number of variables, which make this study’s results even more of interest to Pennsylvania. These variables included: state policies on compulsory school age regulations and well taxations, county characteristics (mining counties, persistent poverty counties, and non-metro counties), and drilling density.
Data showed that counties with a higher compulsory school age saw less negative impact on high school enrollment; this is particularly of interest given the recent passage through the general assembly of an update of Pennsylvania’s own compulsory education ages.
Additionally, counties that tax wells locally as property taxes saw more increase in school revenue from drilling, though not significant enough to counteract the decreased 11th and 12th grade enrollment. Data also revealed a larger decrease in 11th and 12th grade enrollment among individuals in traditional mining, nonmetro, and persistent poverty counties. Researchers hypothesize that specifically in traditional mining counties, this decrease may be attributed to a potential lack of knowledge among students and families around the long term financial returns of additional education. This warrants investigation into what could be done to better educate traditional mining communities about these long term benefits of education. Finally, data showed that drilling activities may not have a significant impact on school enrollments until drilling reaches a certain intensity.
Oil and gas booms create an immediate need for low skilled labor positions. This study shows that this can decrease the perceived value of completing a high school education for individuals in impacted areas, and therefore lead to decreased enrollment in grades 11 and 12. While these booms create a spike in jobs during the drilling phase, workforce needs drop dramatically in the production phase after drilling. Without a completed high school education, individuals who may have left school to pursue boom time employment can experience decreased earning potential moving forward, which can then negatively impact local economies.
By Sam Green, Contributor