Energy downturn works its way across Wyoming economy
CASPER, Wyo. — Last year, M&N Field Services employed 45 people. This year, the Casper-based oil field service company employs 15.
“We’re in survival mode right now on that particular company,” said Cary Brus, who helps manage several of the late Mick McMurry’s companies. “We’re doing fine, but we’re not observing the same margins and activities we’ve seen in previous years.”
M&N Field Services is hardly alone. Energy companies in Wyoming cut their payrolls by 4,200 people, a decrease of 15.4 percent, between August 2014 and August 2015.
Sales tax collections through the first three months of the fiscal year are 14.5 percent off the pace set over the same period last year. Severance taxes are down by 39.5 percent in the first two months of fiscal year 2016.
And, perhaps most worryingly, other sectors of the economy are starting to feel the pinch. Sales tax collections on retail trade were down 5 percent; financial activities, like the equipment rentals made by M&N Field Services, were down by almost 9 percent.
Those numbers, outlined in a report published this week by the state Economic Analysis Division, provided the clearest picture to-date of what many Wyomingites have long felt: The Cowboy States’ economic fortunes are plunging with the price of oil, natural gas and coal.
“We are starting to see that downturn in mining work its way into other sectors as well,” said Jim Robinson, a state economist and author of the report.
There are bright spots, to be sure. Low gasoline prices fueled record visitation to national parks in the state, and the tourism industry responded in kind. The leisure and hospitality sector added 1,800 jobs in August, compared to the same month last year.
Employment in building construction, another bright spot, increased by 500 to 4,700 year-over-year. The overall construction sector shed 100 jobs and employed 25,600 people in September.
The impact of the downturn has varied by region.
Southwest Wyoming has witnessed a slight decline in its fortunes, said Ben Hansen, president of Rock Springs National Bank. Much of the region’s economic activity is spurred by natural gas production in the Jonah Field, where drilling has stagnated in recent years.