The first and most obvious question to ask about the Texas boom in jobs is how much it simply reflects the boom in Texas oil and gas production. Texas boosters say the answer is very little, and play up how much the Texas economy has diversified since the 1970s. And indeed, Texas has more high-tech, knowledge-economy jobs than it did forty years ago. But so does the rest of America, and the stubborn truth is that, despite there being more computer programmers and medical specialists in Texas than a generation ago, oil and gas account for a rapidly rising, not declining, share of the Texas economy.
Unless you’ve been to Texas lately, you might have missed just how gigantic its latest oil and gas boom has become. Thanks to fracking and other new drilling techniques, plus historically high world oil prices, Texas oil production increased by 126 percent just between 2010 and 2013. Only a few years ago, Texas’s oil production had dwindled to just 15 percent of U.S. output; by May of last year it had jumped to 34.5 percent, as new drilling methods opened up vast new plays in once-forgotten corners of south and west Texas with names like Eagle Ford, Spraberry Trend, and Wolfcamp. Thanks to the bonanza of drilling, Texas already produces more oil than Venezuela, and is headed to become the ninth-largest producer of oil in the world, ahead of Kuwait, Mexico, and Iraq.
Meanwhile, Texas accounts for 27 percent of U.S. natural gas production, which is more than the production of any nation except Russia. NASA satellites now record an arc of white light at night stretching from San Antonio to the Mexican border produced by gas flares. As a recent issue of Texas Monthly notes, in once-sleeping towns like Cotulla, where a young Lyndon Johnson taught migrant Mexican children in the 1920s, the population has more than tripled in the past two years, and no fewer than thirteen new hotels have opened, along with numerous “man camps,” to accommodate the influx of oil rig workers.
Though Texas boosters point to the growth of the high-tech industry in Austin, the so-called “telecom corridor” in Dallas, and the growth of health care jobs in Houston, this can’t hide the fact that oil and gas are by far the fastest-growing sources of the state’s economic growth. Between 1998 and 2011, for example, the percent of Texas GDP produced directly by oil and gas extraction more than doubled, according to the U.S. Commerce Department’s Bureau of Economic Analysis. This doesn’t even count the growth of related industries, like oil refining and a petrochemical sector now thriving on the state’s abundant supplies of natural gas. Meanwhile, the share of the Texas economy produced by the information, communications, and technology sectors is 27 percent smaller than it was in 1998.