Energy enables work. Here endeth the physics lesson, because this is about jobs. Oil and gas, like most other sectors, is slashing payrolls amid the Covid-19 crisis. Even now, though, the industry must consider what comes afterward, especially in an election year when Uncle Sam’s role in energy and economic stimulus looks poised for a big expansion.
Oil and gas producers were trimming the ranks even before disaster struck (see this). Now Rystad Energy, a consultancy, estimates perhaps 30% of oilfield services workers could be let go by the end of the year. At the same time, it expects U.S. oil and gas production to drop about 8% by then. That outcome would accelerate productivity gains that kicked in after the last crash. On BLS numbers, oil and gas extraction and support payrolls peaked in September 2014 at almost 540,000 before shedding about a third of those. In the subsequent recovery, payrolls never got much above 420,000 — yet oil and gas production soared.