Why Oil Industry Jobs are Down Despite Production Up
This is no longer true. The country is pumping near-record levels of gas and more oil than ever before. Barclays predicts that spending in North America will fall by 3 percent this fiscal year as producers tighten their belts. This is a concern because President-elect Donald J. Trump has urged companies to “drill, baby, drill” despite the threat of job losses. This raises the possibility of more job losses even as Donald J. Trump urges businesses to “drill baby, drill.” The new technology allows them to oversee drilling, production and fracking from afar. This means that fewer people are on-site. And larger companies are snapping up smaller players, shedding accountants, engineers and other workers as they go.
While the total number of jobs has increased from the bleakest days of the pandemic, far fewer people are working in the industry than before Covid.
Among the cost-cutting techniques being pursued by Exxon Mobil and Chevron: hiring engineers and geologists in India, where labor is cheaper, to support activities in the United States and elsewhere.
The decline in oil and gas work also reflects the continuing transition to cleaner forms of energy, even if that shift is happening more slowly than many analysts had anticipated a few years ago.
“You won’t see a lot of job growth in just the basic act of producing oil and natural gas,” Chris Wright, chief executive of the oil field services company Liberty Energy, said in an interview before Mr. Trump tapped him to lead the Energy Department.
The industry, Mr. Wright said, is “on a trend now of flat to maybe gradually declining employment.”
Mr. Mr. Trump will “protect energy jobs” and lower costs for consumers. This is according to Karoline Leavitt of the president-elect’s transition team. The industry nearly doubled in size over 10 years, turbocharging the economies of places like North Dakota, home to the Bakken shale formation.
Then, in 2014, oil prices crashed. The U.S. production finally recovered, reaching a record high of nearly 13.5 millions barrels per day last fall. The employment situation never recovered. It was marked by booms and crashes, including the recent oil price plunge below zero during the pandemic. “Get out of here.” He was one of more than 100,000 oil and gas workers that lost their jobs in the same year as fuel demand dropped. “What should I do?” he wondered. Many companies used natural gas to power fracking equipment instead of diesel, and found it cleaner and faster. Many turned to natural gas to power fracking equipment, rather than diesel, and found that it was cleaner and faster.
Highly indebted companies didn’t make it, with more than 100 producers and service firms seeking bankruptcy protection in 2020, according to the law firm Haynes Boone.
By late 2024, the number of drilling rigs operating in the United States had fallen roughly 28 percent in five years, federal data show. Bart Cahir, the head of Exxon’s Shale division, told an interviewer last year that they were able to drill three times as many oil wells per rig than in 2018 or 2019. “Per person, our production is a lot higher.” Federal data shows that before the pandemic, oil and gas production wages were 60 percent higher than other industries. By last fall, this premium had been reduced to a little more than 30%. Waguespack returned to the oil patch more than a full year after he was laid off in 2021. Mr. Waguespack said that without them, his annual pay shrank to around $105,000 from roughly $130,000 in 2019, which is on par with what he could make working in an office or a plant back home in Louisiana. Mr. Waguespack’s annual salary dropped to $105,000 from $130,000 in 2019 without them. This was in line with the pay he would make in an office or plant back in Louisiana. Owlett was paid well, considering he lived in the northern part of the state. He earned $35 an hour and worked more than 60 overtime hours some weeks. He quit his gas field job in 2023 when he realized that he could make a similar amount of money by buying discounted merchandise on eBay and reselling them. Those service positions account for most of the work that has come back after the pandemic.
Refining — the process of turning crude oil into gasoline, diesel and other fuels — has experienced more sustained job losses. Even as oil demand is rising globally, many believe appetite for gasoline in the United States and elsewhere has already peaked, and companies are closing fuel-making facilities.
Other job losses have followed mergers and acquisitions. In Pittsburgh, EQT announced last fall that its workforce would be reduced by 15 percent after acquiring a natural gas pipeline company. According to Timothy Haskell who leads EY’s people consulting practice in the United States, five to ten years ago, Western oil companies looked to places like India’s tech hub Bengaluru for positions in information technology, supply chain management and human resources. Today, they’re scooping up engineers and other technical professionals who make up the backbone of the industry.
“While the work force may be shrinking in the U.S., in some cases it’s very much growing in other parts of the world,” Mr. Haskell said.
Last year, Chevron said it was opening an engineering and technology outpost in India, a $1 billion undertaking that Chevron has described as being part of a broader cost-cutting effort.
“We’re going to change where and how we do some of our work,” Mike Wirth, Chevron’s chief executive, told Bloomberg in November. More than half of Chevron’s employees are based in the United States, and that ratio has been stable since at least 2014, a company spokesman said, describing the oil producer as “a proud American company.”
Exxon has had a growing presence in Bengaluru. Over time, the scope of work performed by employees in Bengaluru has grown from routine tasks to more complex ones. Engineers and geoscientists in the southern Indian city have worked on some of the company’s flagship projects, including those off the coast of Guyana and in the United States, three former employees said.
Exxon declined to comment on its Indian operations.
Mr. Waguespack finally landed the Louisiana job he wanted. He makes slightly more money than he made during his second stint working in the oil field. He no longer commutes from Louisiana to West Texas every week. Instead, he now lives just five minutes away from the office. “But I do think I have a good thing going now.”
Ben Casselman contributed reporting.
