The shale oil expansion began in North Dakota, and the expansion of oil output in the U.S. has been nothing short of revolutionary. However, I think it is time to recognize that the fanciful notion of “energy independence” is less and less likely to happen, if it ever really had a chance. We are surely less dependent on foreign oil as the graph shows, but it is not clear that it is going to go to zero anytime soon, if ever.
The big story for North Dakota is not just about oil in western North Dakota, it is about the adjustments to the underlying economic dynamics in the state. Consider the situation of labor markets in two North Dakota cities, Williston and Grand Forks. These data are for the Williston micropolitan area and the Grand Forks metropolitan area from 1997 to the end of 2013.
So I took a look at the labor force data for the metropolitan statistical areas in North Dakota. That would be Bismarck, Fargo, and Grand Forks. Not content with that I also looked at the labor force data for the micropolitan statistical areas in North Dakota (Dickinson, Jamestown, Minot, Wahpeton, and Williston). I also looked at the state labor force data too.
It seems I am something of the regular discussant on the economics of housing issues in Grand Forks and North Dakota. I was a roundtable participant tonight where the topic was affordable housing. There is still no evidence of a market malfunction if you will. One of the issues here is the general perception that markets function in the manner shown in an introductory economics class. Specifically, when we shift supply and demand curves in class or on paper it appears to be an instantaneous adjustment. Essentially we are cutting to the chase.