The trend in gas station employment has been on a predictable path for decades now. In the late 90s we were high on cheap gas fumes and drove gas guzzlers. More demand opened the door for more jobs at gas stations. Slowly though, credit card terminals put into the pumps reduced the need for cashiers and other retail staff in the stores. All of a sudden, gas stations could sell gas all night and no one had to even be around. Employment of course dropped considerably; a contrast to overall retail employment which increased up until the Great Recession.
But then in 2010 something changed. Gas stations started hiring again. Reversing a trend that started in the late 90s. What’s happening?
We know the economy was recovering by then. All retail employees show the same trend. But gas stations weren’t likely to pick up just because the rest of the industry was hiring. Plus, by just about any metric that exists we aren’t going to the pump as much anymore. We’re buying less gas, buying fewer cars, and driving fewer miles. And it’s not like we’re switching back to cash to pay for gas so what explains the budding employment numbers at gas stations?
A couple of things did start happening that might explain an increase in hiring. For one, in 2010 wages started falling at gas stations. Less pay frees of money to hire more heads. Hours worked per employee had been falling since 2006. So, fewer hours per employee and less pay. That’s in line with a general trend of low skilled labor favoring part-time employees. This could contribute to an increase in the aggregate number of heads on staff.
Something else happened in 2010, the number of gas stations increased for the first time in at least a decade. Why is that happening with all the declines in our driving activity? There’s only one thing that seems to be timed appropriatly to partially explain this expansion in employment and stations: ARRA.
You’ve probably forgotten about ARRA, which was the American Recovery & Reinvestment Act, otherwise known as the stimulus of 2009. Hundreds of billions in spending and tax benefits were injected into the economy. Among them was close to $30 billion in highway improvements. That’s fresh pavement, wider lanes, and new roads. That means that we might be driving fewer miles, but on new/better roads. Our routes might have gotten shorter. And where the traffic goes, so do the gas stations. Expansion of highways or new roads can lead to increases in gas stations as well.
But I don’t feel like that alone can explain a rebound in hiring which has more or less continued through today. But the extent of my ability to research the matter is pretty much exhausted. There are trade journals and industry research that these days I just don’t have access to (perhaps a reader does and can hook me up, IBISWorld anyone?) so I can’t learn what experts are saying. I know more stations are expanding to have restaurants but again that’s probably not going to explain an aggregate increase in stations.
What do you think? Do you have some insight or perhaps a hunch? Why are gas stations hiring?
 By The Weakonomist |
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