By the Numbers: Pipe Dreams TransCanada’s Inflated Job Numbers

119,000. That’s the number of jobs in person-years—one person working full time for one year—that will be created by TransCanada’s proposed Keystone XL pipeline according to a study prepared by The Perryman Group. Job creation has been a key argument for the approval of the pipeline, which would transport tar sands oil from northern Alberta, Canada, to Texas refineries along the Gulf of Mexico.

keystone xl, credit: tarsandsaction, flickrcc

Cornell University’s Global Labor Institute took a closer look at this number in their report “Pipe Dreams? Jobs Gained, Jobs Lost by the Construction of Keystone XL” and found that not only is it unsubstantiated, but that the Keystone XL pipeline “will not be a major source of U.S. jobs, nor will it play any substantial role at all in putting Americans back to work.” The researchers further noted that the jobs study is “based on expenditure and sourcing data provided by TransCanada, and none of that information has been disclosed or subject[ed] to independent review.”

The researchers found that “the project will create no more than 2,500-4,650 temporary direct construction jobs for two years, according to TransCanada’s own data supplied to the State Department.” And many pipeline jobs will remain with existing TransCanada employees and contractors. Using the same data, researchers determined that roughly 10-15% of the total workers hired for Keystone XL will be locally based. For some states, this could mean that the number of local workers hired for the project will be less than 100. And much of the pipeline’s steel will be manufactured outside of the U.S.

Imported steel could pose negative economic impacts if it is poorly constructed and prone to leaks. TransCanada’s original Keystone pipeline, built in 2010, was made with imported steel and sprung 14 leaks in its first year of operation—one of which caused 21,000 gallons of oil to spill in North Dakota.

TransCanada has since agreed to 57 new pipe safety specifications demanded by the U.S. Pipeline and Hazardous Materials Safety Administration. (PHMSA), but the Cornell report notes that it is “unclear how TransCanada plans to meet these specifications for Keystone XL, nor is it clear if and how the State Department is monitoring where TransCanada is producing the pipe for Keystone XL or whether the pipe meets PHMSA specifications.” Keystone XL’s route will pass directly over the Ogallala Aquifer which provides drinking water for two million people and supports $20 billion in agriculture. An oil spill in this aquifer could make it unsafe for domestic and agricultural use and devastate the Midwest economy

Cornell concludes that “the Keystone XL’s job creation potential is relatively small and could be completely outweighed” by a major spill.