Oil & gas: 50,000 UK jobs could go
Share
A decrease in oil price will lead to wide spread job losses, according to a trade body.
Figures from trade body Oil & Gas UK suggest that the number of wells drilled in the North Sea could be a third of last year’s total of 109. The body blames the combination of decrease oil prices and increases in tax.
James Beazley, director of energy recruiter Six Recruitment, told Recruiter: “As prices drop this is going to happen. Because of the oil price in the last two years there had been a frenzy in hiring and now there has to be an element of looking at whether they are needed,” adding some of the cuts were part of a normal review taken by the companies at this time of the year.
A leaked email posted on protest site www.royaldutchshellplc.com said the company was going to “ruthlessly review third party costs”, as it prepared for the coming year.
Beazley said: “We knew this was coming, it’s no surprise. Within the sector there are a lot of companies looking to strip costs at the moment and there’s been figures of 10 or 20%, that will mainly come from contract staff.”
The email also stated there would be “no increase in contractor staff rates” and a “review necessity of contract staff as contracts expire”.
Most popular
Most commented
Most emailed
Readers' comments (3)
Joss | Fri, 13 Feb 2009 1:52 pm
Upon further investigation, the reality of Shell's programme is 'fine tuning'. In true british style, we are doing a fine job of talking ourselves deeper into a recession. There is a balance that need to be struck here.
Experience on the ground in Aberdeen says that the oil & gas indsutry IS tightening its belt and there have been rate cuts for some contractors. Some companies have 'eased off' their recruitment drives a little till things pick up again. However, to say that this is going to translate into mass redundancies in this industry (in Aberdeen or elsewhere) is a step beyond reality.
In the event that people are released from positions, past experience has taught us that good people are still in demand. The level of personnel 'churn' will increase but its unlikely that many people will find themselves out of work.
Getting a PR splash in the press is easy if you're willing to attribute your name to negative stories like the above but it does nothing to help peoples confidence in an industry whose outlook is nothing like as gloomy as some other areas are made out to be.
Unsuitable or offensive? Report this comment
Anonymous | Fri, 13 Feb 2009 2:01 pm
Watch Out Beazle's About!
Unsuitable or offensive? Report this comment
James Beazley | Thu, 5 Mar 2009 5:45 pm
In terms of the above, to some extent I have been quoted out of context. I too agree with Joss that there will not be widespread (mass) redundancies across the industry. It is not a case of now seeing if after the 'hiring frenzy' whether or not these companies now require this staff - it is more a case of having reached their optimum staffing levels and now introducing greater riguor into the process of determining who and what really needs to be hired.
However, it would be naive to say that the industry is not facing a period of greater scrutiny - and typically that scrutiny always involves (at some point) staffing levels.
I agree with Joss - there will always be demand for good people. The Oil & Gas industry is one of the industries that will fare a lot better than other industries. But with the proliferation of Independent Oil firms over the last 2-3 years, lower oil prices that make their investments economically challenged, don't be surprised to see significant consolidation of the market, particularly at that level. This is not doom-mongering, but the reality of extraordinary times.
Unsuitable or offensive? Report this comment