The Bakken Formation is an oil-producing shale formation underneath North Dakota, Montana, and parts of Canada. In recent years, horizontal drilling and hydraulic fracturing techniques, combined with higher prices for crude oil, have led to rapid increases in oil extraction from shale formations like the Bakken Formation. As of late 2011, North Dakota was the fourth largest oil-producing state, after Texas, Alaska, and California. The large increase in oil production has led to growth in employment and wages and has changed the industry profile of employment in the region

Ferree, Paul

Smith, Peter W

English

The Bakken Formation is an oil-producing shale formation underneath North Dakota, Montana, and parts of Canada. In recent years, horizontal drilling and hydraulic fracturing techniques, combined with higher prices for crude oil, have led to rapid increases in oil extraction from shale formations like the Bakken Formation. As of late 2011, North Dakota was the fourth largest oil-producing state, after Texas, Alaska, and California. The large increase in oil production has led to growth in employment and wages and has changed the industry profile of employment in the region.BLS_BTN_Employment_and_wage_changes_in_oil_producting_counties.pdf: 105 downloads, before Oct. 1, 2020

Smith, Peter W.

eCommons@Cornell

Employment and Wage Changes in Oil-Producing Counties in the Bakken Formation, 2007-2011

DigitalCommons@ILR

Cornell University ILR School 
DigitalCommons@ILR 
Federal Publications Key Workplace Documents 
4-2013 
Employment and Wage Changes in Oil-Producing Counties in the 
Bakken Formation, 2007-2011 
Paul Ferree 
Bureau of Labor Statistics 
Peter W. Smith 
Bureau of Labor Statistics 
Follow this and additional works at: https://digitalcommons.ilr.cornell.edu/key_workplace 
Thank you for downloading an article from DigitalCommons@ILR. 
Support this valuable resource today! 
This Article is brought to you for free and open access by the Key Workplace Documents at DigitalCommons@ILR. 
It has been accepted for inclusion in Federal Publications by an authorized administrator of DigitalCommons@ILR. 
For more information, please contact catherwood-dig@cornell.edu. 
If you have a disability and are having trouble accessing information on this website or need materials in an 
alternate format, contact web-accessibility@cornell.edu for assistance. 
Employment and Wage Changes in Oil-Producing Counties in the Bakken 
Formation, 2007-2011 
Abstract 
The Bakken Formation is an oil-producing shale formation underneath North Dakota, Montana, and parts 
of Canada. In recent years, horizontal drilling and hydraulic fracturing techniques, combined with higher 
prices for crude oil, have led to rapid increases in oil extraction from shale formations like the Bakken 
Formation. As of late 2011, North Dakota was the fourth largest oil-producing state, after Texas, Alaska, 
and California. The large increase in oil production has led to growth in employment and wages and has 
changed the industry profile of employment in the region. 
Keywords 
Bakken Formation, oil production, employment, wage change 
Comments 
Suggested Citation 
Ferree, P., & Smith, P. W. (2013). Employment and wage changes in oil-producing counties in the Bakken 
Formation, 2007–2011. Beyond the Numbers (Vol. 2, No. 11). Washington, DC: Bureau of Labor Statistics. 
This article is available at DigitalCommons@ILR: https://digitalcommons.ilr.cornell.edu/key_workplace/1287 
R E G I O N A L  E C O N O M I E S
U.S. BUREAU OF LABOR STATISTICS
APRIL 2013 • VOLUME 2 / NUMBER 11
U.S. BUREAU OF LABOR STATISTICS | APRIL 2013 1 www.bls.gov 
Employment and wage changes in oil-producing 
counties in the Bakken Formation, 2007–2011
Authors: Paul Ferree and Peter W. Smith
The Bakken Formation is an oil-producing shale formation underneath North Dakota, Montana, and parts of Canada. In recent years, horizontal drilling and hydraulic 
fracturing techniques, combined with higher prices for crude oil, 
have led to rapid increases in oil extraction from shale formations 
like the Bakken Formation. As of late 2011, North Dakota was 
the fourth largest oil-producing state, after Texas, Alaska, and 
California.1 The large increase in oil production has led to growth 
in employment and wages and has changed the industry profile of 
employment in the region.
About the data
This BEYOND THE NUMBERS examines employment and 
wages by industry sector2 according to the North American 
Related articles
More BLS articles and information related to 
employment in the mining and oil-producing 
industry are available online at the following links:
 y Mining employment trends of 
2007–09: a question of prices, 
www.bls.gov/opub/mlr/2011/04/ 
art3full.pdf
 y Employment in the Oil and 
Gas Well Drilling Industry, 
www.bls.gov/cew/oil_gas_drilling.htm
U.S. BUREAU OF LABOR STATISTICS | APRIL 2013 2 www.bls.gov 
BEYOND THE NUMBERS R E G I O N A L  E C O N O M I E S
Industrial Classification System (NAICS) in the counties in 
North Dakota and Montana with wells producing oil from 
the Bakken Formation.3 Data from 2007 provide a snapshot 
of the economy in the region before the Bakken formation 
began its rapid expansion of oil production,4 and data 
from 2011 provide the most recent annual data available 
from the region. To obtain industry totals for the region, 
employment and wages by private industry sector for 
each county in the region were added together, based on 
annual data from the Quarterly Census of Employment and 
Wages (QCEW). In addition, total employment and wages 
for federal, state, and local government in each county 
were included in the analysis. Some industry totals were 
suppressed for confidentiality reasons, but 88.1 percent 
of the 2007 employment and 88.4 percent of the 2011 
employment were available for analysis at the ownership 
and industry levels included in the study.
The Quarterly Census of Employment and Wages 
program publishes a quarterly count of employment and 
wages reported by employers covering 98 percent of U.S. 
jobs, available at the county, metropolitan statistical area 
(MSA), state, and national levels by detailed industry. 
Data are released within 7 months of the end of each 
quarter.
Changes between 2007 and 2011
From 2007 to 2011, employment in these counties grew 
from 77,937 jobs to 105,891 jobs, an increase of 35.9 
percent. Total wages paid in these counties more than 
doubled over the same period: in 2007, workers in these 
counties earned about $2.6 billion, and in 2011 they 
earned $5.4 billion. Their average annual pay increased 
from $33,040 to $50,553 for an increase of 53.1 percent. 
Over the same period, national employment decreased 
by 4.4 percent, while average annual pay increased by 8.1 
percent from $44,458 in 2007 to $48,043 in 2011.
Employment growth by county
Among the counties included in the study, the county 
with the largest employment growth was Williams 
County, ND, where employment increased by 12,561 
workers from 2007 to 2011. This increase more than 
doubled employment in the county. Almost half of 
this increase was in mining, quarrying, and oil and gas 
extraction. Other counties with employment increases 
of greater than 1,000 workers were McKenzie, Mountrail, 
Stark, and Ward, all in North Dakota. Ward County, with 
more than 31,000 jobs in 2011, had the highest overall 
number of jobs of any county in the area studied, 
but only one oil-producing well as of March 2011. 
Nonetheless, employment increased by 3,208 jobs 
from 2007 to 2011, with most of the increase spread 
across mining, quarrying, and oil and gas extraction; 
construction; transportation and warehousing; and 
leisure and hospitality. McKenzie, Mountrail, and Stark 
counties all had the highest level of job growth in 
mining, quarrying, and oil and gas extraction. Among the 
counties studied in Montana, Richland had the largest 
employment growth, with an increase of 882 jobs from 
2007 to 2011. (See map.)
Industry composition of employment growth
In the counties with wells in the Bakken Formation, 
employment grew by 27,954 jobs from 2007 to 2011. Of 
these jobs, 38.1 percent were in mining, quarrying, and 
oil and gas extraction. Transportation and warehousing 
accounted for 17.5 percent of the growth, and construction 
accounted for another 12.9 percent. Altogether, these 
three industry sectors accounted for 68.5 percent of the 
employment growth in counties with oil-producing wells 
in the Bakken Formation. (See chart 1.)
Despite the strong employment growth in the region, 
a few industry sectors experienced employment 
declines. Most notably, health care and social assistance 
employment declined by 1,353 workers from 2007 to 
2011. Administrative and waste services had the next 
largest decline, with 727 fewer workers in 2011 than in 
2007. These two decreases had an offsetting effect on the 
region’s employment growth equal to about 7.4 percent of 
the size of the region’s net job increase.
Percent growth in employment and wages by industry
The industry within these counties with the largest 
percent increase in employment was professional and 
U.S. BUREAU OF LABOR STATISTICS | APRIL 2013 3 www.bls.gov 
BEYOND THE NUMBERS R E G I O N A L  E C O N O M I E S
technical services, where employment increased more 
than threefold from 521 workers in 2007 to 2,407 in 2011. 
Transportation and warehousing also more than tripled, 
with employment increasing from 1,465 in 2007 to 6,347 
in 2011. Mining, quarrying, and oil and gas extraction 
experienced the third-largest percent increase (276 
percent), with employment increasing from 3,857 in 2007 
to 14,499 in 2011. 
The industry within these counties with the largest 
percent increase in average annual pay was real estate 
and rental and leasing, where average annual pay 
doubled, increasing from $35,940 in 2007 to $72,355 in 
2011. Professional and technical Services experienced 
the second largest percent increase (85 percent), with 
average annual pay increasing from $34,950 in 2007 to 
$64,529 in 2011. Wholesale trade experienced the third-
largest percent increase (70 percent), with average annual 
pay increasing from $42,144 in 2007 to $71,548 in 2011. 
(See chart 2.)
Map
Change in employment level in counties with Bakken shale oil wells, 2007–2011
Source: U.S. Bureau of Labor Statistics.
McCone
Roosevelt
Richland
Sheridan Divide
Billings
Dunn Mercer
McLean
Golden
Valley
McKenzie
Williams
Williston
• Ward •Minot
•
Bismarck• Dickinson
Stark
Burke
Mountrail
Daniels
Employment change
g -200 to 100
g 101 to 300
g 301 to 3,000
g 3,001 to 5,000
g 5,001 to 13,000
C a n a d a
M o n t a n a
N o r t h  D a k o t a
38.1
17.5
12.9
20.9
10.7
0
10
20
30
40
50
60
70
80
90
100
Employment
Percent
Industries not disclosed1
Other industries
Construction
Transportation and warehousing
Mining, quarrying, and oil and 
gas extraction
1. Industry data in some counties were undisclosed to protect the 
confidentiality of individual respondents. Therefore, some of the 
employment growth could not be attributed to a specific industry.
Industry share of employment growth in counties 
with Bakken shale oil wells, 2007–2011
Source: U.S. Bureau of Labor Statistics.
1
Chart 1
U.S. BUREAU OF LABOR STATISTICS | APRIL 2013 4 www.bls.gov 
BEYOND THE NUMBERS R E G I O N A L  E C O N O M I E S
0 50 100 150 200 250 300 350 400
Wholesale trade
Accommodation and food services
Agriculture, forestry, fishing, and hunting
Construction
Real estate and rental and leasing
Mining, quarrying, and oil and gas extraction
Transportation and warehousing
Professional and technical services
Total
Percent
Industry
Chart 2. Percent growth in employment and wages in selected 
industries within Bakken shale counties, 2007-2011Employment Average annual pay
Percent growth in employment and wages in selected industries within counties with oil-producing Bakken 
shale wells, 2007–2011
Source: U.S. Bureau of Labor Statistics.
Chart 2
Change in industry composition
The counties in this study had an economy in 2007 
that was already far more concentrated in mining, 
quarrying, and oil and gas extraction than the country 
as a whole. In the Bakken region, mining made up 4.9 
percent of jobs, while mining comprised 0.5 percent of 
jobs nationwide. Utilities made up 1.9 percent of these 
counties’ jobs, about four times as high a percentage as 
they do nationally. Other industries were concentrated 
about the same as at the national level. Retail trade 
made up the largest portion of the nation’s employment 
at 11.5 percent, as well as in the Bakken region at 12.5 
percent. Construction, wholesale trade, and leisure and 
hospitality were each concentrated similarly in both 
the Bakken region and the nation as a whole. Industries 
with a notably lower concentration than the national 
average in the Bakken region were manufacturing, as 
well as administrative and waste services. Together, 
these two sectors accounted for 16.4 percent of national 
employment but only 6.9 percent of employment in the 
Bakken counties.
Between 2007 and 2011, the industry profile of 
employment in these counties became even more 
concentrated in mining, quarrying, and oil and gas 
extraction, which accounted for 13.7 percent of all jobs 
in 2011. By that time, this industry sector’s share of 
employment was 24 times as large as the industry share 
nationwide. The increase in this industry’s share of jobs in 
these counties is the result of its large employment growth 
over those same years. Transportation and warehousing 
also experienced large job growth, increasing threefold 
to 6.0 percent of jobs in 2011. In 2007, this sector’s share 
of employment was just over half as concentrated as 
it was at the national level, while in 2011, it was nearly 
twice as concentrated in the Bakken region as it was 
nationally. Because of the large employment growth in 
S urce: U. . r   r .
U.S. BUREAU OF LABOR STATISTICS | APRIL 2013 5 www.bls.gov 
BEYOND THE NUMBERS R E G I O N A L  E C O N O M I E S
Chart 3
industries like the above, other industries having only 
modest employment growth became smaller shares 
of the economy. For example, retail trade experienced 
employment growth of 1,116 workers from 2007 to 2011, 
but decreased as a share of jobs in these counties from 
12.5 percent in 2007 to 10.3 percent in 2011. The number 
of government jobs stayed about the same, but decreased 
from 20.5 percent of jobs in 2007 to 15.0 percent of jobs 
in 2011. Health care and social assistance employment 
decreased by 1,353 jobs (–19 percent), which reduced its 
share of jobs in these counties from 9.2 percent in 2007 to 
5.5 percent in 2011. (See chart 3.) Nationally, health care 
made up 12.7 percent of jobs in 2011.
Summary
The rapid increase in oil production in the Bakken 
shale region has been accompanied by strong 
employment increases in mining, quarrying, and oil 
and gas extraction; transportation and warehousing; 
and construction. Several industries have seen large 
increases in average annual pay, notably real estate 
and rental and leasing, as well as professional and 
technical services. The result of this growth is a 
regional economy with a higher percentage of its jobs 
in mining, quarrying, and oil and gas extraction, as 
well as transportation and warehousing, and a lower 
percentage of jobs in industries that did not grow as 
rapidly, such as government, health care and social 
assistance, and retail trade.
This BEYOND THE NUMBERS article was prepared 
by Paul Ferree and Peter W. Smith of the Quarterly 
Census of Employment and Wages Program. Inquiries: 
http://data.bls.gov/cgi-bin/forms/cew?/cew/cewcont.htm  
Telephone (202) 691-6567. 
Information in this article will be made available to 
sensory-impaired individuals upon request. Voice phone:  
(202) 691-5200. Federal Relay Service: 1-800-877-8339. This 
Source: U.S. Bureau of Labor Statistics.
4.9
13.7
6.0
12.5
10.39.2
5.5
20.5
15.0
39.1 38.0
11.9 11.6
0
10
20
30
40
50
60
70
80
90
100
2007 2011
Percent
Industries not disclosed1
Other industries
Government
Health care and social assistance
Retail trade
Transportation and warehousing
Mining, quarrying, and oil and gas 
extraction
1. Industry data in some counties were undisclosed to protect the confidentiality of individual respondents. Therefore, some of the employment 
could not be attributed to a specific industry.
Industry share of employment in counties with Bakken shale oil wells, 2007 and 2011
Source: U.S. Bureau of Labor Statistics.
1.9
1
BEYOND THE NUMBERS R E G I O N A L  E C O N O M I E S
U.S. BUREAU OF LABOR STATISTICS | APRIL 2013 6 www.bls.gov 
1. Source: www.eia.gov/todayinenergy/detail.cfm?id=3750.
2. Industry sectors correspond to 2-digit industry codes in the North American Industry Classification System (NAICS).
3. The counties examined in this analysis had oil-producing wells as of March 22, 2011, as documented in this map from the 
Energy Information Administration, www.eia.gov/oil_gas/rpd/shaleoil1.pdf.
4. To see a visualization of growth in oil production from Bakken shale in North Dakota, see this article, www.eia.gov/
todayinenergy/detail.cfm?id=7550.
article is in the public domain and may be reproduced  
without permission.
Suggested citation:
Paul Ferree and Peter W. Smith, “Employment and wage 
changes in oil-producing counties in the Bakken Formation,” 
2007–2011, Beyond the Numbers: Regional Economies, 
vol. 2, no. 11 (Bureau of Labor  Statistics, April 2013), 
www.bls.gov/opub/btn/volume-2/Employment-and- 
wage-changes-in-oil-producing-counties-in-the- 
Bakken-Formation.htm.
Notes
Upcoming articles
 y Recent price trends with imported fertilizer 
 y Shale gas and its effects on domestic natural gas 
prices
 y Spending on pets:  “tails” from the Consumer 
Expenditure Survey
Visit our online archives to access past publications at
http://www.bls.gov/opub/btn/archive/home.htm.


https://digitalcommons.ilr.cornell.edu/cgi/viewcontent.cgi?article=2298&amp;context=key_workplace

Employment and Wage Changes in Oil-Producing Counties in the Bakken Formation, 2007-2011

Abstract

Similar works

Full text

Available Versions

eCommons@Cornell

DigitalCommons@ILR