Do Even Oil Rig Companies Hire Workers During The Recession?

Do Even Oil Rig Companies Hire Workers During The Recession?

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There's plenty of bad news from the economy, and you may have heard that oil rig companies like Schlumberger will be laying off 5000 workers. Halliburton says they also plan to cut some positions. News from Canada is not good either - entry level roustabout jobs are cutting salaries by 12%, and even experienced positions like drillers are losing 4% of their salaries. But despite this bad news, the situation in the oil industry is very bright compared to the rest of the economy.

Now, for some good news from the industry - Noble Corporation is rolling out 5 new oil rigs and hiring up to 1500 workers, while Transocean is rolling out 10 new oil rigs and is also hiring 1500 workers.

In 2007, when Transocean merged with GlobalSantaFe, they had an order backlog of $33 billion. Today, despite their reported layoffs, Schlumberger still has an outstanding order book of at least $1.77 billion from just one of their many business units. That is a lot of work left to be completed, which means there are still offshore drilling jobs available if you know where to look for them.

Exxon, one of the major oil companies, spends $79 million everyday just to look for new oil fields. Overall, they plan to spend $150 billion over the next 5 years on oil exploration and oil production. Even with a recession going on, oil companies throughout the world will spend $400 billion looking for new oil fields to replace today's aging oil fields. Some of that exploration has already borne fruit - three new oil fields of varying sizes have been found in Brazil.

Just because the recession is slowing things down, doesn't mean there isn't still a lot of work to be completed. While the demand for oil from mature economies like the US and Europe has become stable, this is not the case for the Asian giants. Remember that both the giant economies of China and India are still expected to grow strongly at 6.5% and 5% respectively. What's notable is that this is a worse case scenario. The International Energy Agency predicts that both India and China will consume 300% more oil by 2030, and that China will beat the US as the world's largest energy user in 2020. They (IEA) also estimate that the world needs to invest at least $20 trillion over the next 25 years to this increase in energy demand and to make up for the decline of the world's major oil fields.

Basically, the recession won't last forever and the price of oil won't stay low for very long. Oil rig companies have strong incentives to continue drilling for oil, which means most of them still have to hire more workers for the long haul. In addition to that, too many offshore drilling jobs are still being filled by workers hired in the 1970s. These workers are getting old - they will be retiring in the next few years, so job prospects for new workers looking for offshore oil rig jobs and roustabout jobs remain bright.

Altogether, these factors means that oil rig companies will still be hiring a large number of oil rig workers over the coming decades.

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