Energy: Formation pressures

…Williston, a city at the centre of the resources boom, is struggling to adapt. Here, a one-room apartment costs $2,000 a month (in Fargo, the state’s largest city, it can cost $450). Ad hoc settlements called “man camps” have sprung up, but housing shortages force many to live in caravans, mobile homes and even their own cars.

Average wages have risen by $19,800, or 80.3%, since 2000. An influx of male workers in the three main oil counties means there are at least 1.6 single young men (aged 18-34) for every single young woman. Little wonder that strippers in Williston are said to earn up to $3,000 a night in tips.

Some are worried that a bust will follow the boom—just as it did 30 years ago. One oil-services firm says growth will slow if prices drop to below $80 a barrel. Julia Haggerty, an analyst at Headwaters Economics, fears that economies that are rich in resources tend to underinvest in education and infrastructure, and fail to diversify their economies enough. Locals can take comfort from the fact that last year North Dakota ranked second among all states in entrepreneurship, with strong growth in new businesses.

Headwaters Economics points to growing wage gaps in the west of the state. In 2001 the average teacher and health-service worker earned about $34,000 less than oil and gas employees did. In 2011 this gap was $63,000. Rising salaries and an inflow of uninsured labourers working in dangerous occupations are causing problems in hospitals. The New York Times reports that unpaid bills have caused the debt of McKenzie County Hospital to climb by 2,000% during the past four years, to $1.2m. Three years ago the hospital saw 100 emergency visits per month; last year the monthly average was 400.…

Author:
Ben Alexander

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