TRS Houston: Aerospace and Petrochemicals in the US
The aerospace and petrochemical industries have two things in common; they’re both vital to the US economy and currently experiencing strong growth. So what does the future hold for these key industries?
One reason the aerospace industry is so important to the US is the fact it is a major source of exports. In 2012 it contributed $118.5 billion in export sales to the country’s economy and had the largest trade surplus of any manufacturing industry at $70.5 billion. Up to 2014, the aerospace and defence industry had experienced its best ever year; the fifth consecutive year of record revenues and profits. While this has largely been driven by substantial demand for commercial aircraft, particularly in growing economies in the Middle East and Asia-Pacific, demand is also increasing again for military aircraft, as countries around the world increase their defence budgets in response to the global security situation.
The commercial aerospace subsector is expected to experience strong growth this year, due to high demand for modern aircraft with improved fuel efficiency. The amount of passenger traffic continues to grow around the world, especially in growing economies in Asia. In fact, passenger and freight traffic is expected to grow around four and a half percent annually over the next two decades. As one of only two major global commercial aviation manufacturers, US-based Boeing will greatly benefit from this increased demand. Together, Boeing and rival Airbus have a combined order book of over 12,400 aircraft, representing 9 years’ worth of production at current levels, and the number of aircraft manufactured each year has increased steadily since the start of the decade. It is thought that low oil prices are enabling airlines to invest in the next generation of more fuel-efficient aircraft, preparing for an increase in oil prices and allowing them to meet passenger preferences more effectively.
Meanwhile, the aerospace industry continues to invest large sums in research and development. While this R&D spend has decreased in recent years, due partly to a drop in funding from the US government, NASA has recently announced a new X-planes programme aimed at decreasing the environmental impact of aircraft. While commercial aerospace manufacturers continually look for ways to make their planes quieter and more fuel efficient, the basic design of commercial airlines has remained unchanged for decades. NASA aims to experiment with innovative new airframe designs as well as improve the technologies which go into an aircraft. A major aim is to design an aircraft that is shaped to reduce the volume of its sonic boom, as supersonic aircraft flying over populated areas is currently highly problematic.
Taken together, all of this makes the job market for aerospace engineers in the United States incredibly competitive. From 2012 to 2022, the market is expected to grow by around 7%. With engineers in high demand in general, due to the effects of an aging workforce, it comes as no surprise that major employers in the sector are looking for more talent acquisitions personnel to ensure they are able to access the best talent.
The US aerospace industry is not alone in experiencing considerable success. The sharp drop in crude oil prices and persistently cheap natural gas has led to a petrochemical boom, as these are the industry’s raw materials. Petrochemical companies have proposed 140 projects in the last five years, of which almost a third were announced in 2015. The American Chemistry Council says there are 266 projects planned from 2010 to 2023, coming at a cost of $164 billion. Of these schemes, 104 are located in Texas and most are in the south of the state, including the Houston area, resulting in over 15,000 new petrochemical industry jobs in the state, and 67,000 nationwide.
Much of the demand for petrochemical products stems from the growth of the middle classes in developing countries, as the plastics derived from oil and gas are used in many consumer goods. Also, as most American petrochemical complexes are dependent on natural gas rather than the more expensive naphtha used in other countries, they will become more competitive when oil prices recover. However as the industry expands rapidly, it’s struggling to find enough skilled labourers and engineers to construct new facilities and populate them.
With so many new petrochemical projects in the pipeline in Texas, our Houston office is ideally placed to help engineers find the perfect job opportunity in the area. If you’re looking for a role in the Lone Star state, get in touch via our contact page.