USA – JOB LOSSES DUE COVID-19 PANDEMIC REACH 94,000

The Oilfield Services and Equipment Employment Report, published monthly by the Petroleum Equipment and Services Association (PESA), found that employment in the oilfield services and equipment (OFS) sector fell by more than 8,600 jobs in June, bringing total job losses due to pandemic-related demand destruction to nearly 94,000. Oilfield services and equipment (OFS) employment is down 116,000 jobs from June 2019 and is at its lowest point since March 2017.
Using Bureau of Labor Statistics (BLS) data, PESA, in consultation with researchers from the Hobby School of Public Affairs at the University of Houston, estimates OFS sector jobs in the U.S. dropped from 764,189 in February to 670,480 in June, a decline of 12.3%. Losses were heaviest in April, totalling 59,306 jobs — the largest one-month total since at least 2013.
OFS employment year-over-year fell from 785,106 jobs in June 2019 to 670,480 in 2020, a decline of 14.8%. The jobs lost represent annual wages of approximately $12.5 billion.
While the rate of OFS job losses has slowed, industry analysts remain concerned about future job losses as COVID-19 cases rise throughout the US. Rising infection rates may depress economic activity as communities are forced back into quarantines.
The BLS report includes information about a classification error in recent months they believe is causing the agency to underestimate unemployment numbers. According to BLS analysis, data collectors have been misclassifying some workers temporarily separated from their jobs (such as furloughs or temporary layoffs). The error, while significantly reduced in the June data, persisted, BLS says. These errors have likely caused a similar under-estimation of OFS job losses by PESA. Many OFS companies have 25-50% of their workforce currently on furlough.
PESA analysis of Small Business Administration data found that approximately 30,000 OFS jobs have been supported by loans from the Paycheck Protection Program.
According to PESA’s analysis, the following states have lost 4,000 or more OFS jobs in 2020:
• Texas 57,000
• Louisiana 9,700
• Oklahoma 8,800
• Colorado 4,800
• New Mexico 4,300
• California 4,300
• Pennsylvania 4,200
PESA is the trade association representing the OFS sector, which includes companies involved in oilfield equipment manufacturing, drilling, well completions, pressure pumping and more. Job losses jeopardize the energy supply chain by draining the sector of the innovative men and women who develop technologies that increase efficiency, improve environmental performance, and reduce greenhouse gas emissions.
OFS employment was estimated by analyzing data published by the U.S. Bureau of Labor Statistics and covers the economic activities of OFS companies, which include oil and gas extraction, construction and manufacturing. Total employment is estimated using the Quarterly Census of Employment and Wages, published by BLS, and jobs data reported by BLS monthly.
(Source: PESA – Slip and cut drilling line in North Dakota)

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