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Massive Downsizing In Oil Sector Brings Acute Pain For The Holidays

The price of oil is displayed in downtown Midland, Texas, in February. Across the state, drilling budgets have been cut and companies have laid off workers.
Spencer Platt
Getty Images
The price of oil is displayed in downtown Midland, Texas, in February. Across the state, drilling budgets have been cut and companies have laid off workers.

The holiday season can bring stresses — what with the shopping, shipping, baking and bills — but for workers in the energy sector, this December is turning out to be especially tough thanks to industry layoffs.

Take Robin Ewan, who, for more than 30 years, worked as a test engineer for Schlumberger, a global oilfield service company. Not anymore.

"This is the first time around Christmas that I've been laid off, and it has a bit of an effect, because now, you know, you're wondering who to buy presents for and what presents. You're going to make it more meaningful ones than expensive ones," he says.

Ewan started working for Schlumberger in Aberdeen, Scotland, and spent the past 20 years based in Texas. In February, he had to rush home to the U.K. to say goodbye to his dying mother. The day after he returned, he was told he no longer had a job.

"Basically, I've been doing odd jobs for people here and there — electronic-related stuff, fixing computers, fixing cars, whatever. But as for looking for a real job, I basically haven't tried because I know there's so many people in my situation in this town that are in the same boat," he says.

Crude oil prices have dropped to their lowest level in nearly seven years. Oil and gas companies have laid off close to 56,000 Texans since December of last year, according to the Texas Alliance of Energy Producers. That doesn't include cuts in industries dependent on the oil sector like trade and professional services.

Debbie Milks is chief operating officer for Brookwoods Group, a staffing firm that specializes in finding jobs for marketing and communications workers.

"Some of them, this is their second or third time that they've been let go from different oil and gas firms, service companies, and what we're seeing now is some are actually saying, 'Oh my gosh. Maybe it is just time to let it go and get out of here,' " she says.

Milks says her clients are now begging to be placed somewhere more stable than the energy sector, even if it means taking a pay cut of tens of thousands of dollars.

"They know the pink slips are coming, and they hear the talk. There's a lot of stress associated with that, and then the holidays — it doesn't make it any better," she says.

Companies can take steps to manage that stress. If they make sure employees feel they're being treated fairly during layoffs, those who remain are more likely to concentrate on doing their jobs. But Brent Smith, who teaches industrial psychology at Rice University, says that's not happening.

"The magnitude of the downsizing is quite large. So it's very difficult to accomplish that in a manner that probably is going to be perceived as fair and equitable by the surviving employees," Smith says.

The Greater Houston Partnership is predicting metro Houston will lose another 9,000 energy jobs in 2016. That will include more cuts at Schlumberger, which is finalizing its multibillion-dollar merger with Cameron International.

Ewan still gets together with his old workplace friends for meals regularly. "They are very stressed," he says. "You can tell that they're just waiting to get chopped any time."

Ewan says he's still getting by with odd jobs, but he'll be looking for a more permanent position sometime in the new year — probably outside the oil business.

Copyright 2015 Houston Public Media News 88.7

Andrew Schneider