A Sustainable Workforce Starts With You

Oil Workers Face Job-Loss Transitions

The following article was authored by Matthew Waller.

Tracy Kyzer’s company gave him a ride back home. He had been given a company vehicle, and that was going away. His employers had given him time to clean out his desk.

In early March, Kyzer, 51, was let go from oil and gas company Schlumberger in Midland, joining thousands who have lost jobs in the Texas energy sector.

His wife is still working with an oil company.

“After I hang up the phone with you, she may not be,” Kyzer said on a call.

Across the state capital investments are being cut, as the price of oil has plummeted more than 50 percent from its $100 highs last summer. Between December and January employment in the mining and logging sector fell by 3,400, just over a full percentage point, according to data from the Texas Workforce Commission. Then between January and February, according to most recent data, mining and logging lost an additional 3,500 jobs.

“The oil prices have gone down, and the first thing they lose is human resources and personnel,” Kyzer said. “My dad was in the oil field 40 years. I’ve seen a lot of them (busts). You can kind of see it coming. You hope it’s not as bad as it is, then it’s as bad as it is. …

“You’re going to be shocked. You hope it’s not you, but you know there is a chance you’re going to go away.”

That day he received a phone call that two more of his co-workers had been laid off as well.

“It was an amicable break on my end,” Kyzer said, noting that the company had benefits and severance. “It’s not like they just turn you to the cold. They don’t want to leave you twisting.”

And a network of help exists around the state.

“We’ve been trying to find (the unemployed) as quick as we can,” said Mike Buck, executive director for the Concho Valley Workforce Development Board.

He said about 40 people in the area around San Angelo are lined up to undergo eligibility screenings for jobs.

With oil prices staying where they are, those networks could be sorely needed.

The price slump

Oil prices’ dramatic descent was brought about by a massive amount of oil pumped into the market from U.S. shale formations, made possible by new hydraulic fracturing techniques, coupled with slower growth overseas.

Texas has contributed strongly to the uptick in U.S. oil production from 5 million barrels a day in 2008 to 9 million in 2014.

“I think it will take some time to recover from those levels to what we’ve been used to in the last several years,” said Gurcan Gulen, a researcher with the University of Texas Bureau of Economic Geology.

Six months from now the prices might be a bit higher, “but not that much higher,” he said. “If the summer driving market season doesn’t help, we might see even less of a recovery.”

The world may be especially dependent on demand from China, but the country’s economic growth may be around 6 percent for the rest of the decade rather than the 9 to 10 percent it has experienced recently, Gulen said.

“I think it’s certainly going to have an impact on the state,” Gulen said. “It impacts everything.”

The Federal Reserve Bank of Dallas has said that Texas is more economically diverse than it was during Texas’ 1980s recession, but it still estimates that the state may create 125,000 fewer jobs by midyear than it would have before the oil drop.

According to recently released data, Texas no longer leads the nation in job creation. It created 20,100 jobs in January, falling behind Michigan with 24,200, Ohio with 25,100 and California with 67,300.

Help toward new jobs

Training courses, interview preparation, résumé writing and other assistance is offered at the Concho Valley Workforce Development Board and elsewhere.

“The ones coming through the doors from what I can tell … folks have been positive. They know this happens in the oil and gas field,” Buck said. “The overall situation is, there are jobs available. They just don’t pay as much as the oil field jobs do.”

“Since January we have noticed an increase in oil and gas worker … layoffs,” Ken Treviño, president and CEO of Workforce Solutions of the Coastal Bend, wrote in a release last week. “Oddly the only industry super sector to show an increase over the month of January was Mining and Construction. We suspect many laid off oil workers may be going back to work for other employers quickly.”

Treviño expressed optimism when new job numbers were released Friday.

“While we are aware of the recent production slow down due to falling oil prices, our diverse Coastal Bend regional economy remains strong,” Treviño said in a Friday statement. “Our career centers professionals stand ready to assist workers affected by recent downsizing in the oil and gas industry with employment transition and placement services.”

The unemployment rate in Texas dropped for the sixth straight month in February, from 4.4 percent to 4.3 percent, according to the Texas Workforce Commission’s release Friday. Mona Statser, executive director for Workforce Solutions North Texas, said people might be eligible for free training.

“Anybody who loses their job through no fault of their own — they’re dislocated workers — they may have the opportunity to access trainings with federal funds,” Statser said.

The services available, everything from interview practice to résumé writing, is offered standard in regional workforce training areas. The workforce organizations can offer training in high-demand fields as well, however, such as truck driving.Statser said people in the oil field are reluctant to retool, though.

“They’re hoping that they’ll get their jobs back because they pay very well,” Statser said.

One option in another field is construction. Randy Walker, vice president at S&B Engineers and Constructors, said he is looking at a shortage of tens of thousands of workers because of massive amounts of construction projects around Houston and down into Corpus Christi. Projects include power plants, commercial buildings and refineries.

Walker said some companies, depending on the size, may subsidize people learning a new skill.

“This is probably the hottest market I’ve seen in 35 years,” Walker said.

Kyzer said he isn’t planning on learning a new skill set, noting that he’s not in his 20s anymore. He said he hopes to use his experience in the industry to find a new job in the oil and gas sector.

“It’s either that, or I may have to run for governor,” Kyzer said.

His own word of advice to people still be in the oil and gas industry: Save up just in case.

“Now is not the time to buy a new Cadillac or invest in a new house,” Kyzer said. “You work, and you pay off the credit card. (Unemployment insurance), that’s going to keep you alive until you actually find another job.”

Republished with the permission of Journal Media Group. You can read the original article on Standard-Times