Oil and gas jobs decline amid record-breaking production by Mike Soraghan, Aug 8, 2024, E & E News, Politico
Fracking has made the U.S. the world’s leading oil and gas producer, but drilling creates fewer jobs each year.
The United States is pumping out more oil and gas than any country in history. But even as production soars, oil field employment keeps shrinking.
The decadelong decline isn’t driven by climate policy or the rise in clean energy. Instead, it’s the result of boom-and-bust cycles — and the fossil fuel industry’s relentless push for efficiency.
Translation: more profits
“You just need fewer workers to produce more oil,” said Greg Upton, executive director of Louisiana State University’s Center for Energy Studies. “When you need less workers, that’s a sign of growth. On the other hand, these are real people losing their jobs.”
Oil production is up 5 percent since 2019, the last peak before the pandemic. The industry set a new record for crude production last week, according to data released Wednesday by the U.S. Energy Information Administration, pumping an average of 13.4 million barrels a day.
But employment among the people who find that oil and pull it out of the ground is down nearly 20 percent from prepandemic levels.
Oil and gas production still supports hundreds of thousands of jobs in the United States, from the rig floor to office suites in Houston skyscrapers. Even at the low end, many pay enough to offer middle-class incomes to people without college degrees.
And many of the jobs supported by oil and gas drilling are also far from the oil field — such as the union pipefitters who work in refineries and the workers at nearby restaurants. The Marcellus Shale Coalition trade group says in Pennsylvania the industry supports 10 times the jobs that drilling wells create directly.
Much of the goodwill that the oil and gas industry enjoys stems from its reputationlie for creating new jobs. It hasn’t done that in years, but Sean O’Leary, a senior researcher at the Ohio River Valley Institute, said most people haven’t noticed.Or, they love lies.
“It’s still a very powerful claim,” said O’Leary, whose think tank focuses on expanding clean energy in Appalachia. “The narrative has legs of its own, quite removed from facts.”
Fossil fuel jobs loom large in the upcoming election. Pennsylvania, a swing state and the country’s No. 2 gas producer, is potentially key to winning the presidency.Watch the cruel lies escalate.
Vice President Kamala Harris, the Democratic presidential nominee, once backed a ban on fracking — unlike President Joe Biden, who won the state in 2020. Harris recently flipped her position, after former President Donald Trump and his allies highlighted her 2019 statement backing a ban.
Fracking is short for hydraulic fracturing, a practice long common in all types of oil and gas production. But in politics, it’s become a catchall word for the drilling that has driven the oil and gas boom of recent years in Pennsylvania and other parts of the country.
Opposing fracking isn’t a deal-breaker for most Pennsylvania voters, said Christopher Borick, a pollster and political science professor at Muhlenberg College in Pennsylvania. Still, he said, it could matter a whole lot to a small sliver of people in a state that will be won on the margins.
“All the little things matter” in a state as politically even as Pennsylvania, he said. The downward trend in drilling jobs “could have implications, but it’s not clear what the implications might be.”
‘Overhired and overpaid’
Employment levels in oil and gas production never fully recovered after crashing during the pandemic. Production, by contrast, is headed skyward.
Oil production averaged 12.9 million barrels a day in 2023, compared to 12.3 million in 2019. Gas production hit an average of 125 million cubic feet per day in 2023, up 12 percent from 2019.
It was all pulled out of the ground by a workforce nearly one-fifth smaller than it was in 2019.
The drop is even steeper when compared to the go-go days of the shale boom 10 years ago. In 2014, more than 600,000 people worked to produce oil and gas. Today, it’s more like 380,000, producing 45 percent more gas and 47 percent more oil.
“In the first boom, the oil and gas industry overhired and overpaid,” explained Patrick Jankowski, senior vice president for research at the Greater Houston Partnership, a business group.
The bubble burst in 2015, months after Saudi Arabia accelerated production in a global market already overflowing from the U.S. fracking boom. The plummeting price of oil forced companies to run leaner or go under. Many producers who had “chased production” by maximizing volume found themselves under pressure from investors to throttle back, ending the industry’s era of “drill, baby, drill.”
That meant both drilling less and drilling with less. Technology improved. Longer lateral wellbores meant more oil or gas could be pulled out of one well. Drilling new wells also became cheaper.Because of all the deregulation corrupt politicians granted in return for the millions in donations from oil and gas making drilling more polluting, more toxic and more unsafe?
“They have rigs that get up and walk,” Jankowski noted. Whereas once crews had to disassemble and reassemble rigs every time they moved, now “you just press a button.”
Then came the pandemic, when the price of oil fell so hard and so fast that it dropped briefly below zero.Which is why politicians lied and claimed the pandemic was over, mass murdering or permanently disabling millions of citizens via SARSCoV2, causing horrific suffering. Profits for the rich over people, always. It’s hideous humane nature.
Many of the oil and gas jobs lost never came back. And employment experts say many employees who lose their jobs in an oil bust look for new ones in industries that are less volatile. As Molly Determan, president of the trade group Energy Workforce and Technology Council, explained, “It’s hard to bring them back.”
Today, oil producers are guiding drill bits from remote locations, introducing drones that can do inspections from the air and exploring artificial intelligence.
Upton, who speaks about energy to industry and civic groups in his role as director of the state energy center, said he has found himself in places where people are hurting because of the loss of oil and gas jobs.
“It, candidly, can come across as crass when I come in and say, ‘Isn’t it great we can produce more with less?’” he said.
But the reduced job numbers do not appear to be causing widespread economic malaise. In Midland and West Texas, where nearly half the nation’s oil is produced, crude production kept soaring in the first three months of this year, up 8 percent over the first three months of 2023.
Job growth slipped 3.7 percent in that same time period. Still, unemployment fell in Midland and nearby Odessa.
Enduring influence
In Houston, which calls itself the “Energy Capital of the World,” the 2015 bust flattened growth for two years, Jankowski said.
But while the oil and gas industry’s presence shrank, others expanded. For example, chemical companies thrived on cheap gas. Houston has substantially more jobs now than it did in 2014 at the peak of the shale boom.
“Oil and gas will always be important in Houston,” Jankowski said. “But it doesn’t drive the economy the way it did 10 years ago.”
If declining employment were to affect any place, it might be Pennsylvania, one of the first states to have its economy, environment and politics transformed by the “fracking” boom.
Today, gas production in Pennsylvania has leveled off at about 630 billion cubic feet a month after peaking at 670 billion in December 2021. But 30 percent fewer people are working to produce it compared to before the pandemic. Bureau of Labor Statistics data shows that a little more than 12,000 people worked in the state’s gas industry in 2023.
But the slide in drilling jobs isn’t driving political discussion right now in the swing state, Borick said.
One reason might be that trade unions — some of the most vocal supporters of the state’s gas industry — value it so much for the drilling jobs, but the pipelines and processing plants that gas production fosters.
“Politicians and chambers of commerce and economic development people probably created the expectations for the industry, and if they weren’t met, you know, that’s where it came from, not the industry itself,” said Jeff Nobers, executive director of the Builders Guild of Western Pennsylvania, a coalition of unions representing 60,000 workers and contractors in construction trades.
O’Leary at the Ohio River Valley Institute said the gas industry was never as much of a job creator as its reputation implied. For example, he noted that after a gas well is drilled and completed, not many employees are needed to keep the well producing.
“There is no obvious correlation between production and employment,” he said.
The jobs the industry does sustain offer annual incomes averaging nearly $100,000, said David Callahan, president of the Marcellus Shale Coalition.Feed the greed ‘n frac frenzy; lure in the greedy and ignorant with lies.And the effects of those jobs ripple outward.
Pennsylvania’s natural gas industry supports 123,000 statewide jobs, when including jobs generated through the supply chain and through employee spending, according to a study commissioned last year by the trade group and based on a survey of its board members. The study also calculated that the industry contributed more than $41 billion in economic activity in 2022.
“While production has gone up or moderated in recent years, we’re proud of the employment numbers,” Callahan said.
While employment is lower than it once was, it’s also more steady, said Determan of the Energy Workforce and Technology Council. In the boom times when drillers chased production, she said, many hired too many workers.
“Then you would have to lay off lots of people,” she said. Efficiency, she said, “has provided more stability. It takes away some of the dramatic swings.”
She doesn’t see the industry losing its influence.
“We represent a lot of jobs in a lot of districts,” she said. “It matters.”
Refer also to:
2023: Photo by Kyle Brittain of Wall of Fire at Frac Central Fox Creek Alberta
2021: All those promised millions of frac jobs: Just another Big Lie
2021: Big Oil no longer equates to Big Jobs.
2020: Greed greed greed: Another 600 jobs cut in Houston oil patch
2020: Encana/Ovintiv Greedy Frac’ing Bloodbath Continues, Kills More Jobs After Promising Not To.
2019: Frac jobs getting frac’d
2019: Frac’ing creates job jobs jobs? Frac Quake Shaker Repsol laying off 30 per cent of Canadian staff
2014: What happened to all those jobs fracing creates? Encana bets against frac jobs
2014: Stunning Fact: NY Creates 4 Times As Many Jobs As PA Without 1 Shale Well
2013: Isn’t frac’ing supposed to create massive prosperity and jobs? Encana proves it isn’t so!
2013: Harper government cutting more than $100 million and about 500 jobs related to protection of waterCan’t have workers working to protect water in Canada when corrupt politicians decimate laws to enable the endless frac and bitumen harms to water.