Don’t expect Americans in the oil patch to cheer the U.S. job market’s solid gains.
The falling oil and gasoline prices that for months have coincided with strong U.S. hiring have helped most Americans. But they’ve come at a painful cost for workers in the energy and mining sector: 122,300 lost jobs in the past year.
Even as workers nationwide are earning slightly more than they did a year ago, average wages have tumbled 1.5 percent to $26.72 an hour for energy production workers.
The November jobs report that the government released Friday illustrated the divide between the broad economy and the ailing fossil fuels industry: Overall, U.S. employers added a robust 211,000 jobs and the unemployment rate held steady at a low 5 percent. But the energy industry, reeling from falling oil prices and weakening global demand, lost 11,300 jobs.
In just 18 months, oil prices have cratered from $107 a barrel to roughly $40. And gasoline prices have plunged from around $3.70 a gallon to $2.05. Those prices are poised to fall further as the Organization of Oil Exporting Countries decided Friday to keep production running high.
“This is likely going to continue for six months or so as things settle out,” said Ken Medlock, an economist and Senior director at Rice University’s Center for Energy Studies in Houston.
Since August, Texas’ unemployment rate has risen as the state has shed oil and related manufacturing jobs, according to the Bureau of Labor Statistics. More than 17 percent of the mining jobs — which include oil and natural gas — have disappeared from North Dakota in the past year.
Major energy firms such as Schlumberger, Baker Hughes, Halliburton, ConocoPhillips, Chevron and BP have announced layoffs.
Average wages have largely declined for oil workers because of these departures. But Medlock said he’s heard that some workers agreed to lower salaries in order to keep their jobs and protect their benefits.
