Press "Enter" to skip to content

Strong US job reports hit by oil and gas sector

Due to sustained low oil prices, energy producers have been forced to reduce spending which has not helped the US job market.

The already struggling industry has seen a 50 percent drop in the price of oil since June, resulting in a vast drop in activity. Since October, the number of active rigs in the US has dropped nearly 40 percent.

According to the Labor Department, the number of oil and gas workers fell by 9,300 in February, which is a direct result of the drop in oil prices. In January, the drop saw 5,800 workers laid off.

For oil extraction workers, including rig workers, February saw an additional loss of 1,100 jobs added to the 1,800 job losses in January. Support activities for mining workers fell 7,400.

The numbers are adding up, showing that the jobless rate in the US fell to a 6 and-a-half-year low of 5.5 percent. Nonfarm payrolls have soared to 295,000 in February.

Despite recent figures, the past two months are showing the painful effects low oil prices are having on the American workforce.

During the 2008 financial crisis, it took nearly five months for the oil and gas sector to begin falling and when it did, more than 50,000 workers lost their jobs over the course of one year.

Large producers such as Halliburton, Schlumberger and Baker Hughes have added to the work stress with recent announcements of tens of thousands of worldwide layoffs this year.

Comments are closed.