Oilfield Services Employment Diving to 10-Year
Oilfield services sector is set to reach the lowest total workforce count in over 10 years, as a consequence of the COVID-19 pandemic, low oil prices, and cuts in spending by the oil companies.
"The oil market turmoil brought on by Covid-19 has led to lower-than-anticipated activity and delayed projects, forcing the industry to deploy cost-cutting measures. Rystad Energy analysis of the top 50 oilfield service (OFS) firms shows that staffing is set to reach its lowest level in more than 10 years, with the anticipated revenue per employee also declining towards the previous downturn’s level," Norwegian energy intelligence group Rystad Energy said Tuesday.
Rystad Energy tracked the permanent employee count of the top service companies, including reported permanent employees at year-end, and found that the reduced staff levels in the OFS industry seen in 2016, after the previous downturn, have mostly been maintained since then at just over 760,000 employees, keeping a major cost driver – investment in human capital – at steady low levels.
"However, the downsizing expected this year is likely to result in the OFS industry experiencing the lowest total headcount in over a decade, which we estimate will amount to about 610,000 employees," Rystad said.
Rystad Energy calculates revenue per employee as a company's total yearly revenue divided by the number of employees by year-end.
"Studying this parameter provides an understanding of how efficiently service companies are able to utilize ....