Analysts at Goldman Sachs claimed Thursday the oil industry is on the cusp of a turnaround after oil supply gluts earlier this year wreaked havoc on the industry.
As oil fields continue to come back online and the yearlong oil oversupply begins to recover, analysts at financial institution Goldman Sachs argue the oil and gas industry will need to add between 80,000 and 100,000 employees just to keep up with demand by 2018. The increase in growth would also require an additional 700 oilrigs.
Jeff Bush, president of energy firm CSI Recruiting, mirrored the institution’s sentiments, suggesting that a “worker shortage” disaster is in the making.
“When we get back to a reasonable level of activity, there’s going to be a supply crisis of experienced personnel. I just don’t see any way around that,” Bush told reporters.
U.S. energy companies are bleeding jobs this year at astronomical rates — in fact, they are among the biggest companies killing jobs. Large and small companies such as National Oilwell Varco, Halliburton, and Chevron have seen a liege of layoffs and job terminations.
The cost of oil ballooned to $105 per barrel in 2014, which incentivized U.S. drilling. Oil prices have since tumbled to below $40 per barrel, prompting the U.S. energy industry on developing new drilling techniques, such as fracking.
The drop in industry stands in stark contrast to the shale and gas revolution between 2009 and 2014, which resulted in a huge influx of 233,000 jobs, Goldman estimated.
Goldman Sachs predicted the industry lost nearly 170,000 jobs during the downturn.
“It’s been brutal. You’ve seen a lot of good people get handed their walking papers, with really no option as far as other employment opportunities,” Bush said about the oil industry’s poor fortunes over the past year.
Goldman thinks the oil industry will recover and hire enough employees to fill the void, particularly because oil producers pay higher wages than most other industries. Energy companies pay 84 percent higher than the national average, Goldman said.
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