BAD MEMORIES
Some of those laid off during the oil bust earlier this decade left the industry and aren’t looking back.
The recent plunge in oil prices is bringing back some bad memories. Since the beginning of October, crude oil has suffered its longest losing streak ever — 12 consecutive trading sessions — and its biggest one-day sell-off since the oil bust earlier this decade.
Reinel Solano has been through this before. He worked for more than 14 years as a reservoir engineer. But as oil prices slide, he’s feeling pretty good these days.
Solano gave up on the industry in 2016 and launched his own business — one he says is doing quite well.
“It gives me comfort that I made the right decision,” he said.
Solano is one of the tens of thousands of energy workers who lost jobs in the brutal oil bust that began in late 2014 and reached its low point in early 2016, when oil prices hit $26 a barrel after falling from over $100. The industry then struggled through a painfully slow recovery.
Solano is also among the thousands for whom the last oil bust never really ended, even as worries grow about another. Oil has fallen by about 30 percent, since hitting a recent peak above $76 a barrel, into the low $50s, with parallels to the conditions of 2014: record production, rising inventories, slowing demand.
In 2015, Solano’s job was eliminated. After about six months of frustrating interviews, each followed by rejection, Solano took his severance pay and used it to buy a flooring franchise in 2016.
“When I started looking for jobs, it was about 100 applicants per position,” Solano said of seeking work as a reservoir engineer. “By the end of the year, it was about 500.”
Solano said sales have doubled at his company, Floor Coverings International Houston Heights, which does commercial and residential design and installation services of flooring products such as hardwood, carpet, stone and tile. He’s even hired another out-of-work reservoir engineer as his project manager.
Solano keeps in touch with several engineers who continue to look for work, and out of habit, he still watches the ups and downs of the price of oil.
Solano knows many out-ofwork engineers in the area. Some, he said, have lost their savings and even their homes. A handful of others, like him, have successfully started a small business.
In all, the Houston area lost around 86,200 energy-related jobs from December 2014 to December 2016 and has only recovered a fraction of them, according to data provided by the Greater Houston Partnership, the region’s business advocate. The partnership estimates that the region has about 230,000 energyrelated jobs now.
Bill Gilmer, an economist at the University of Houston, forecasts oil and gas-related jobs in part by analyzing rig counts and oil prices. He doesn’t foresee a return to the industry’s peak employment of about 300,000 energy-related jobs in Houston anytime soon.
“With a prolonged period of $100 oil,” Gilmer said, “we could get back to 275,000 jobs.”
Solano won’t be included in those numbers. He said he enjoys owning a business and is not looking to get back into the industry. He also thinks Gilmer’s forecast is optimistic.
“I don’t think it will get back to those levels,” Solano said.