After A Year Of Economic Growth, Converse County Aims To Save Up

Jan 17, 2020

Jim Robinson, principal economist for the Wyoming Economic Analysis Division, said when he looks at Wyoming's economy in the coming year, it's not going to bring news that anyone wants to hear. 

"It's still growing. We're still seeing expansion in the state. But, clearly, it's at a much slower rate, comparing it to say where we were six months ago," Robinson said.

He said six months ago, the state was looking at a three percent economic expansion, but now it looks closer to one percent. But that doesn't take away from the fact that the past year has been especially good to one county in particular.

"Well, of course the county that for the last two or three years, that's been really seeing the impact of the oil drilling activity in the state is Converse County," Robinson said.

So far in fiscal year 2020, Converse County is $11.2 million ahead in its sales and use tax collections based on year-to-year comparisons, according to the state's Economic Analysis Division.

Robinson said tracking growth through sales and use tax shows more than just the business side of a local economy.

"I like that number because it reflects that spending by not only consumers, but by businesses as well. So, when you see that number jump up or being ahead of its numbers last year, it tells you something is going on in the economy there," he said.

Historically, Converse County has relied on energy, agriculture and hunting and fishing tourism to support itself. Robert Short, chairman of the Converse County Commissioners, said it's been a boom-bust economy for many years. But starting in 2008, there was a growing desire to develop oil and natural gas in the county.

"That exploration got very serious around 2013, 2014. And then of course we had a dramatic commodity travesty. The bottom fell out of pricing for oil specifically. And gas, coal and uranium, for whatever reason, we had the trifecta of terrible in commodity pricing. And we saw a massive exodus of investment dollars and development in the county," Short said.

But oil and gas production started picking up again in the past couple of years.

"We have seen a dramatic increase in 2018 and 2019 in infrastructure investment in Converse. We went from approximately 350 million cubic feet of natural gas production capacity, to sitting at about 1.2 billion right now," Short said.

Short said the growth comes with its own set of challenges. The biggest challenge is that there aren't enough workers. State Economist Robinson said that will have an impact on businesses.

"In other words you're going to see salaries and wages go up as employers try to attract from a limited pool of people available to work for them," Robinson said.

He added those same factors might put off new businesses from coming to town.

But Short said, on the flip side, there are a number of available jobs. And that has brought in workers from other counties and even other states. More people coming in means the area needs more housing. As Wyoming Public Radio has reported, housing in Douglas has been tight, especially for out-of-state workers.

Building new housing is a gamble for developers that just doesn't always fit with the boom-bust economy that comes with oil and gas production, Short said. That's why the commissioners decided to put their focus on long-term investments and infrastructure.

"Our road and bridge department, we've invested in them more because we've poor-boyed, so to speak, for quite a few years. So, in the last few years, we've started upgraded our fleet, both equipment-wise and man-power wise," he said.

They are also working on property development in the hopes to attract a wide-range of businesses.

But Jim Robinson with the state's Economic Analysis Division makes it clear that the state's economy is slowing down. He said December's oil rig counts are down compared to November.

"It's certainly tied into our drilling activity in the states. The oil and gas jobs have stayed about the same every month this year. Despite seeing all that growth in oil production, we're not a corresponding increase in oil and gas jobs. They are able to produce more with fewer resources, including jobs," he said.

Robinson said as the state looks ahead in the year, the forecast for sales and use tax collection will likely come in as expected. But beyond that, the futureremains unclear.

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