Canada's cowboy shortage: Oil boom makes for cheap gas and expensive burgers.

Where Have All the Canadian Cowboys Gone?

Where Have All the Canadian Cowboys Gone?

Moneybox
A blog about business and economics.
Nov. 25 2014 3:42 PM

Where Have All the Canadian Cowboys Gone?

450353973-israeli-cowboy-yechiel-alon-rids-his-horse-after-he
Just doesn't pay the way it used to.

Photo by Uriel Sinai/Getty Images

Bloomberg has an interesting take today on Canada's oil boom. In addition to fueling cheap gas prices, the boost in crude output is also creating a shortage of cowboys.

Here's the logic behind that. As oil production and energy investments have taken off, jobs in that industry have started to pay two-thirds more than those in livestock. According to Bloomberg, specialized livestock workers in Alberta were making about $39,700 last year, while petroleum workers were earning $65,000. Nearly three-quarters of farm employers said they had trouble hiring:

"It’s impossible to find workers," said Tim Stewart, 57, who has four unfilled jobs and is considering selling the 4,000-head ranch in Rockglen, Saskatchewan, that his family has owned since 1910. "If someone came along with a big fat checkbook, we’d probably walk away."

The Canadian cattle herd is at its smallest since 1993 with 13.3 million livestock as of this July. One analyst told Bloomberg that meat packers are expected to slaughter just 2.4 million cattle in 2015—the smallest number since 1963. Meat packing plants are operating at their lowest capacity since 2008.

In the U.S., the cattle situation isn't any better. The U.S. Department of Agriculture has described the current cattle herd of 87.7 million as the smallest since 1951. Beef prices have been on a tear, boosting everything from the steak costs in your local grocery store to the sticker price on the beef burrito options at Chipotle. A recent report in Reuters noted that beef prices, predicted to rise 11.5 percent this year, could add another 5 percent in 2015 on drought and disease.

A bit of Thanksgiving cheer though: Despite the lift in beef prices, all poultry costs fell 0.9 percent in October and the subcategory that includes turkey dropped even more. Give thanks that you're not supposed to buy roast beef for Thursday.

Alison Griswold is a Slate staff writer covering business and economics.