Energy Gains Are Adding Fuel And New Jobs to U.S. Economy
WASHINGTON (AP) – A stronger-than-expected April rebound in job creation and recent dramatic discoveries of vast U.S. oil and gas reserves are helping to lift the American economy out its long funk.
The economic good news is also drawing attention to the importance of private-sector innovation rather than government policy in fostering growth.
The Labor Department’s report that payrolls expanded by 165,000 jobs last month and the unemployment rate declined to a four-year low of 7.5 percent does not represent explosive job growth by any measure.
Yet the report offered a big sigh of relief to President Barack Obama and his Democratic allies in Congress.
The recent jobs improvements were mostly driven by private-sector gains independent of action by the president and Congress.
The report showed employer confidence about the economic outlook even in the face of new federal budget cuts.
Economists widely agree that job gains would have been bigger were it not for the automatic across-the-board cuts that are beginning to take an $85 billion bite out of government spending.
House Speaker John Boehner, R-Ohio, said that while the report had “some good news” on the jobs front, it was still important to “focus on growing our economy rather than growing more government.” He said that includes “expanding our energy production.”
The energy sector plays a major role in global economic growth and recovery.
Recent discoveries have put the United States on track to become the world’s largest producer of oil and natural gas in a few years. At the same time, oil imports have fallen to a 17-year low.
The energy breakthroughs have come despite Obama’s heavy emphasis on promoting renewable clean-energy sources, such as wind and solar power, for the future.
In the months and years ahead, domestic energy production “is going to be a real driver of economic growth,” said economist Douglas Holtz-Eakin, a former director of the Congressional Budget Office and chief economic adviser to Sen. John McCain’s 2008 presidential campaign.
These energy gains, while not that big yet, will be reflected in more jobs at drilling and other energy work sites, reduced manufacturing costs and improvements in the nation’s balance of trade.