“It’s not just the COVID-19 impact, but also the oil and gas lows, which are continuing,” said PetroLMI vice president Carol Howes of the job figures.
” We do not expect to see layoffs in the coming months and next year. ”
Howes says she did not expect the kind of layoffs attended a few years ago, after the decline in oil prices in 2014, when employed directly in oil and gas exploration, services and the pipelines amounted to about 226,000 the number of.
“The industry is already pretty, pretty thin in terms of the number of people working in the industry,” Howes said. “As a result of that, we only have so much that we can cut, so that in many places we can cut in terms of employment. “
North America’s petroleum industry has been hammered by the economic impact of the COVID-19 pandemic, with plunging international fuel price war fueled the market with low crude oil prices.
The situation has spurred oil and gas companies to cut production and cut capital spending plans, billions of dollars this year. It also led to job losses.
On Thursday, oil and gas producer Ovintiv – formerly known as Encana, said it has cut staff by 25% as it prepares for the most modest growth in the energy sector. The decision affected nearly 650 jobs.
Earlier this week, giant pipeline Enbridge announced that 800 people working for the company would take voluntary buyouts, including early retirement, as it aims to avoid layoffs.
PetroLMI reports that while the volume of oil and gas employment is in Alberta (128,180 people), thousands of jobs are located in British Columbia (8,304), Saskatchewan (8,940), central Canada (4.924) and Atlantic Canada (7.680).
Howes says the most affected sector so far appears to be the oil and gas service sector.
“They are the first sector to be affected and especially because if you are not drilling for oil and gas, these are the jobs that are most directly affected by the layoffs,” she said.
Elizabeth Aquin, acting president of the Petroleum Services Association of Canada, said a survey of their members in the past few weeks found several had seen layoffs in the range of 35 to 50% this year.
She said a tough few months came on top of several tough years, adding more service companies don’t want to throw out more people.
“These workers have years of experience and we are renowned around the world for technological expertise and our ability to innovate,” she said. “We need to keep the skills and the expertise.”
She said while companies in her sector have put thousands of jobs, it would be worse without the federal wage subsidy. But, she added, and not every company that needs the program has been able to qualify.
Ottawa also announced that it will spend $ 1.7 billion to help clean up orphans and inactive people, the oil and gas wells of Alberta, Saskatchewan and BC, a move it hopes put a few people back to work.
Tristan Goodman, President of the Explorers and producers Association of Canada, said a lot about how the coming months will play out for the energy sector and its workers based on pricing and government policy.
He said that if benchmark oil prices stabilize above US $ 40 per barrel, or better yet, US $ 45 would help. Friday, West Texas Intermediate prices close just under $ 40 US.
Goodman said it will also be important to see how the policies of different governments take up, including federal loans and guarantees to help small and medium businesses stay afloat during the economic downturn.
” It comes back to the end of workers, ”he said. “There are people, families, jobs. ”
There are still many opinions on how quickly economies and oil prices stabilize given the unpredictability of COVID-19 in a pandemic and its impact on industries and consumers.
Matthew Fitzsimmons, vice president of energy, service research at Rystad Energy, believes the picture of Canadian oil and gas sector employment will be difficult until capital investment returns to a more normal state.
“It’s a difficult situation,” Fitzsimmons said.
“But we expect these jobs, the investment is picking up, to come back. It won’t look like pressing a light switch necessarily, because we see a long way to recovery from a spending perspective rather than where we were in 2019.”
He said Rystad expects investment to bottom at the end of 2020 and start increasing in 2021, but estimates that it could take a few more years to return to the spending levels seen in 2019.