‘This could be the bust that gets me,’ says oilfield service veteran
Tim Harris was preparing to relocate for an assignment with energy services firm Halliburton Co. for the fifth time in 15 years when his career came to a halt. A third-generation employee, Harris rose through the ranks at the top shale-oil services provider to oversee oilfield crews. He sailed through several busts, with the exception of a nine-month break in 2016.
But April’s historic price crash, which has left US crude prices down 50 percent since January, put him and tens of thousands of oil service veterans out of work. The cuts have gone deep into the ranks of managers, taking seniority and skills gained through past downturns.
Such cuts, which are expected to accelerate this year, spell trouble for firms when it comes to restaffing and tapping know-how from previous busts, said some industry executives.
Halliburton this month cut 22 percent of its headquarters staff, while Schlumberger recently reshuffled its executive team and warned of “significant” expenses for job cuts this quarter. Oil major BP plans to cut half its senior managers in coming months.
Since March, about 66,300 oilfield jobs, or 8.5 percent of the sector’s workforce disappeared,
FASTFACT
Since March, about 66,300 oilfield jobs, or 8.5 percent of the sector’s workforce, disappeared.
according to an analysis by trade group Petroleum Equipment and Services Association. For all of 2016, when crude oil prices slumped amid a supply glut, employment in the sector fell 17.4 percent.
“Losing talented people is a concern,” said Kevin Broom, a PESA director who did the analysis. “We’re going to need that knowledge and expertise when demand returns.” Harris has cut his oil ties, moving to Amazon.com, where he accepted an entry-level manager’s job in light of the 14.7 percent April US unemployment rate.
The oil industry could struggle to rehire experienced managers if other sectors rebound first, said Ron Ness, president of the North Dakota Petroleum Council.
Career website LinkedIn.com has dozens of goodbye posts from workers with 15- to 30-year careers in the oilfield, many with top firms. “I’m joining the crowd posting my departure via retirement from Schlumberger after 34 years,” Jatinder Kalra, a team leader, wrote. “It’s Armageddon for oilfield service companies,” said Andrew Graham, a 20-year Schlumberger veteran cut in April.