Natural resources and employment growth in the US

TED: The Economics Daily is a handy website updated each day by the Bureau of Labor Statistics. Today’s post has the following map:

employment-up-more-than-100000-over-the-year-in-new-york-los-angeles-and-dallas-metro-areas

Take a look; what do you see?  In particular, do you see any pattern to the red dots (where employment is shrinking)?

Areas dependent on natural resources for employment are hurting.  Start nearby, in northeastern Minnesota:  A big red dot (2700 lost jobs) on the Iron Range.  Look to the west and the south and you’ll see red dots in areas where oil, gas, and mining predominate.

Now move south and east.  The oil-gas-fracking boom boosted employment in western New York and western Pennsylvania, but now it’s dragging down these areas.  Similarly, declining demand for coal is hurting West Virginia, Illinois, and Indiana.

The places with big green circles, by contrast are major metropolitan areas.  Instead of focusing on a single industry, these areas boast diverse economies with a wide variety of businesses.  Minneapolis/St. Paul, Chicago, New York, Dallas, Atlanta, to name a few, fit this pattern.

Understanding these patterns is an important area of research.  Two scholars, Richard Florida and Edward Glaeser, probe this subject from different points of view but come to similar conclusions: cities and urban centers are the center of modern economic growth.  We need to keep this in mind when thinking about economic policy.