High Taxes, Public Debt & Underfunded Pensions Vs. Oil Jobs
By Adam Levine-Weinberg @ The Motley Fool
Illinois saw the biggest year-over-year jump in unemployment in the U.S. last month. At 9.5%, the Illinois unemployment rate is at a level last seen in 2011. Even worse, the labor force shrank last month, suggesting that tens of thousands of people gave up looking for work. The seasonally adjusted unemployment rate has risen by nearly a full percentage point since December. Moreover, things may not get better anytime soon; earlier this month, Caterpillar (NYSE: CAT ) announced that it would permanently lay off 460 workers in the state due to falling demand for mining equipment.
Many Illinois residents worry that the state is losing its competitiveness compared to neighbors like Indiana and Wisconsin because of higher taxes, a growing public-debt burden, and a severely underfunded pension fund. Caterpillar executives have threatened to move jobs out of Illinois because of rising tax rates. This is a significant threat, because the company is one of Illinois’ largest private employers, with about 23,000 workers in the state.
… On the other hand, if you live in North Dakota, you probably don’t have to worry about finding a job. North Dakota has had the lowest unemployment in the U.S. for some time, and it’s no secret why. North Dakota has benefited from a tremendous oil boom in the past few years as advances in hydraulic fracturing have opened up a huge oil-drilling opportunity in the Bakken shale formation. Companies like Whiting Petroleum (NYSE: WLL ) — the top Bakken driller — have rapidly expanded production as oil prices have remained near $100. Whiting’s production increased 22% year over year in 2012, and the company plans to ramp up investment this year to boost production even further.
The Bakken oil boom has created lots of jobs in the oil sector, but there are plenty of other jobs available. The population boom in western North Dakota has created a tremendous demand for housing and other services. On the other hand, there is a cost to this rapid growth. With so many people flooding into the Bakken oil region so quickly, the cost of living has skyrocketed and could remain elevated until development catches up with population growth.
Read the Rest @ 2 States Where Unemployment Is Growing and 1 With Plenty of Jobs