OFS Growth Continues for 5th Month

America’s oilfield services and equipment sector (OFS) employment rose by an estimated 8,421 jobs in January, a fifth consecutive month of growth, according to preliminary data from the Bureau of Labor Statistics (BLS) and analysis by the Energy Workforce & Technology Council (Council).

BLS revisions showed the sector gained 5,717 jobs in October, 3,651 in November, and 933 in December. After shedding nearly 102,000 jobs from March to August due to pandemic-related demand destruction, the upstream oil and gas industry has added back approximately 21,000 positions over the past five months.

The monthly Oilfield Services and Equipment Employment Report, compiled and published by the Council, estimates job losses due to pandemic-related demand destruction now total 81,061. OFS employment is down 80,014 jobs since January 2020.

Using BLS data, the Council, in consultation with researchers from the Hobby School of Public Affairs at the University of Houston, estimates OFS sector jobs in the United States dropped from 706,528 in February 2020 to 625,467 in January 2021, a decline of 11.5%. Losses were heaviest in April, when the sector shed 57,294 jobs—the largest one-month total since at least 2013.

The jobs lost in 2020 represent annual wages of approximately $15.4 billion.

Job losses were heaviest among companies providing support services for oil and gas extraction. This portion of the OFS sector has cut 72,580 jobs since the onset of the COVID-19 pandemic—89.5% of the sector’s total job losses.

OFS sector employment rose 1.4% in January as companies reopened some production to prepare for expected demand increases as more people are vaccinated. Uncertainty remains because of the high number of COVID-19 cases, which continue to suppress demand.

OFS job losses are estimated to be heaviest in Texas and Louisiana, which are the nation’s leaders in oil and gas production. According to BLS data, the top states in 2020 OFS job losses were Texas, 56,200; Louisiana, 10,800; Oklahoma, 9,800; Colorado, 5,200; New Mexico, 4,800; California, 4,700; Pennsylvania, 4,600; North Dakota, 4,000; Wyoming, 2,900, Ohio, 2,100; Alaska, 2,000, and West Virginia, 1,900.

OFS employment is 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.

BLS data is preliminary for the two most recent months and is subject to revision. The Council updates monthly totals according to BLS corrections, and updates the statistical model quarterly.