The Shale Boom Has Added Almost Nothing To US Economic Growth
While the industry accounts for 2.5% of overall GDP, it's contributed just 0.6 percentage points (ppts) to the 7.6% rise in GDP since the recession, he says. Exploration and production investment has increased by 56%, but this represents only a $36 billion chunk of to real GDP, or 0.3 ppts of the increase.
Nor have falling natural gas prices really done much (Goldman's Jan Hatzius has previously addressed this). Dales estimates producers have only saved about $70 billion, or 0.8% of total wage costs; while households have only saved $20 billion, or 0.2% of real incomes. Here's the graph showing that energy-intensive industries have seen zero or even negative output growth since the recession.
Capital Economics
Dales concludes:
Overall, the boom in domestic energy production is responsible for only a small part of the rise in GDP since the recession and it does not explain why the US has outperformed most of its closest competitors. Instead, the recovery in US GDP since the recession has been driven by an improved performance across a wide range of sectors, including motor vehicle production and professional business services.
We should add that there are lots of places where the impact has been real. Oil imports are plummeting. The boom has boosted employment in many places. And it is reducing energy costs.
But Dales' point is that in aggregate, it may not be doing as much as many have been saying.