Waiting for the next boom
Oil and gas are rebounding, but deep-water jobs remain scarce
Erin Donlon came to the Offshore Technology Conference for the first time this week, immersing himself in the world of deep-water drilling — a world that, until recently, he was sure he’d want to enter.
The pay was great and the work seemed exciting, so, when Donlon arrived at Maine Maritime Academy as the oil boom accelerated in 2013, he set his sights on deep-water rigs. But now, with the industry shaking off the worst bust in 30 years, he considers himself fortunate that he’s not graduating until December, all the while hoping that more opportunities open offshore.
“Once we had the (oil) recession, I thought,
‘That’s going to be interesting,’” said Donlon, 23, one of a handful students selected to attend OTC this year from his school in Castine, Maine. “A lot of people graduating this month, they’re like, ‘What can I do?’”
That sense of guarded optimism was common among job seekers at OTC this year, as the oil industry’s prospects have brightened somewhat, but not enough to lead to widespread hiring that would recover the more than 200,000 jobs cut in the United States after prices began their plunge at the end of 2014, according to the Labor Department. Those losses hit Houston and its concentration of energy companies particularly hard, disrupting lives and forcing many to leave the region or change careers as the jobs have returned slowly.
Only about 30,000 U.S. oil and gas jobs have come back since the market bottomed last year, and most are concentrated in onshore shale fields — particularly West Texas’ Permian Basin and increasingly the Eagle Ford shale in South Texas — where oil and gas are cheaper to extract and companies can drill profitably at lower prices. Deepwater drilling, however, is far more expensive, often requiring years of development, billions of dollars of investment and higher prices to make money.
As a result, the renewed hiring has largely bypassed the offshore sector. Anthony Caridi, an oil and gas recruiter with the Houston firm QTSI, offered a grim assessment of the situation for those still looking for work.
“Anything drilling is a no-go,” he said. “Offshore is even more of a no-go.”
Another year of help
This marked the second year in which OTC tried to support displaced workers with networking events and workshops to help people polish LinkedIn profiles and interviewing skills. A session Monday filled to capacity. Some people looked to change jobs. Recent graduates hoped to score their first positions; many others were simply trying to get back on their feet.
At a roundtable discussion about résumé writing, human resources professional Metha Vasquez coached attendees on how to characterize jobs they might have taken outside their fields after a layoff: as “other experience” at the
bottom of the page, with “relevant experience” at the top.
“I don’t want you to be discouraged by this,” Vasquez said. “A lot of people have been unemployed for a long time, and they’re working at Wal-Mart. That’s not their career; they’re paying the bills. That’s OK.”
Another table focused on setting up consulting businesses. Companies cut mostly early career employees during the national recession that lasted from 2007 to 2009, but the oil bust fell hardest on those with many years of experience but too young to retire.
Those older workers have the skills to win contracts with companies that might have hiring freezes in place but still need to get certain projects done, according to Susan Howes, vice president of engineering at Subsurface Consultants and Associates of Houston.
Her company puts together teams of technical professionals like geologists and petroleum engineers who work as independent contractors to complete short-term projects for oil and gas
companies.
She was flooded with résumés during the bust, and most of those workers are still around.
“I wouldn’t say that the pool of applicants has contracted,” Howes said. “There are still companies that are going through reductions in force, and there are people who are still looking. They’ve been looking for a while.”
That pool includes Tarek Ghazi, a geologist with 40 years of experience, 20 spent at ConocoPhillips before he went to work for several other companies. He was laid off from a small reservoir data firm last November and has had a few interviews since.
But he remains philosophical about the experience, which he knows is inevitable in the boomand-bust cycles of oil and gas.
“I would never get discouraged, because that is the nature of the industry,” he said. For that reason, he’s careful not to get too excited about hints of a recovery. “I don’t know if it is a real uptick, or a bunch of self-reinforcing rumors.”
Ghazi and others take solace in the company of others who have found themselves between jobs, with new organizations like the Society of Petroleum Engineers’ Members in Transition group and the Houston-centric Pay it Forward Networking Program, which coordinates tours and training sessions with energy companies to help people maintain their skills and make connections. Those support communities help ease the burden of unemployment by making people realize they’re not alone and the layoff wasn’t their fault.
Still, they can’t create jobs that don’t exist. Case in point: In late March, SPE held a career fair with 350 job seekers and 15 employers. A month later, according to organizers, the companies reported filling only two positions with people who attended the event.
Shifting needs
Drilling companies are mostly waiting on oil prices to rise before shifting back into gear. But for unemployed energy workers, a recovery in production may not get their jobs back.
That’s because companies are re-evaluating which positions they need and which can be replaced by automation. Among them: rig maintenance, which can be accomplished by robots piloted by operators onshore.
“A lot of companies are looking at what the alternative might be to just plain rehiring,” said Rachel Everaard, who leads the oil and gas human resources team for the consulting firm EY. “Certainly you’re not going to replace all drillers with remote operations next year, but you’ll start to see them hire fewer and fewer, as they start to do things differently.”
For now, the sluggish recovery hasn’t dashed the hopes of young workers still hoping to break into the industry. Donlon, the Maine Maritime student, will graduate with a Coast Guard Unlimited license, allowing him to pilot ships, and he’d like to put it to work in oil exploration.
Even if renewable energy and increasing fuel efficiency cut into demand for some petroleum products, Donlon expects that others, such as petrochemicals, will keep the oil and gas industry vibrant.
“The oil industry pretty much runs everything, and I’d like to be part of something where I can have an impact,” Donlon said. “It’s a waiting game, for now. There’s definitely hope.”