Pumpjacks draw oil out of the ground near Olds, Alta., Thursday, July 16, 2020. THE CANADIAN PRESS/Jeff McIntosh

Oilpatch workforce faces more cuts this year before rebound in 2022-23, says PetroLMI

Oilpatch workforce faces more cuts this year before rebound in 2022-23, says PetroLMI

CALGARY — Canada’s oil and gas workforce is expected to shrink by almost 7,300 jobs this year thanks to layoffs linked to corporate mergers and cost cutting, according to an energy industry labour data firm, before staging a modest rebound over the following two years,.

Direct industry employment is projected to rise to about 176,000 jobs by 2023, up from 160,700 this year, but down almost seven per cent from 2019’s total of 188,800 jobs, says PetroLMI, a division of Energy Safety Canada, in a three-year forecast.

That compares with 229,000 jobs in August 2014, the highest point in the past 10 years.

“Since 2014, we are down almost 59,000 jobs, about 26 per cent of our workforce,” said vice-president Carol Howes.

She said the decline is the result of lower spending in the oilpatch during an economic downturn that started in late 2014, a global price war in early 2020 which impacted oil prices and lower demand for fossil fuels because of the COVID-19 pandemic.

“The combination of all of those is unprecedented and the duration of our downturn, we’ve not seen that in recent years,” said Howes.

“We’ve seen peaks and valleys but the valleys have never been this long.”

The lengthy downturn has led many experienced and prospective workers to switch to other careers and that will make it difficult for the industry to fill positions going forward, particularly in the oil and gas services sector which is already seeing a shortage of certain skills, she said.

The downturn in the Calgary-based oilpatch has contributed to record high vacancy rates in the city’s downtown office towers and a unemployment rate of more than 10 per cent in Calgary.

Cenovus Energy Inc. has said its takeover of rival Husky Energy Inc. will result in cutting between 1,720 and 2,150 workers from the combined workforce. Meanwhile, job cuts were also announced late last year at Suncor Energy Inc. and Imperial Oil Ltd.

PetroLMI says the industry will need about 19,800 net new workers by 2023 — 7,800 due to industry activity and almost 12,000 replacement roles for those who are expected to retire.

It notes that capital expenditures across the non-oilsands exploration and production sector were slashed by an estimated 38 per cent to $15.8 billion last year and operating spending was cut by 14 per cent to $19.8 billion.

Capital spending in the oilsands, it said, fell 21 per cent to $7.17 billion and operating spending was down by eight per cent to $21.8 billion.

A rise in oil prices early this year led the Petroleum Services Association of Canada to increase its forecast for the number of wells drilled across Canada by 750 to 3,350 in January.

The number represented an increase from 2020, when the actual well count fell to a 50-year low of 2,992.

This report by The Canadian Press was first published March 24, 2021.

Companies in this story: (TSX:CVE, TSX:IMO, TSX:SU)

Dan Healing, The Canadian Press

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

The Business Council of Alberta says the federal budget is nearly silent on Canada’s energy sector. (File photo by The Canadian Press)
Business Council of Alberta mostly disappointed in federal budget

Investments in childcare and early learning commended

.
3-hour paid leave for Albertans to get vaccinated in the works

The UCP government intends to introduce legislation that will ensure working Albertans… Continue reading

Alberta completed 18,412 COVID-19 tests, as reported on Wednesday, for a test positivity rate of 9.5 per cent. (NIAID-RML via AP)
Highest daily count of 2021 so far: Alberta reports 1,699 COVID-19 cases

Variants now make up 59 per cent of Alberta’s active cases

Several cases of COVID-19 were reported among employees of stores at Bower Place Mall. (Photo by LANA MICHELIN/Advocate staff).
COVID-19 cases reported at Bower Place mall stores

AHS said five complaints were investigated since March, and required changes made

Westerner Park’s Exhibition Hall was used as a vaccination clinic on Wednesday. A steady stream of people came to get their COVID-19 shots either by appointment or as walk-ins. Photo by PAUL COWLEY/Advocate staff
No long lineups at walk-in vaccination site in Red Deer

A steady stream of people walked into Westerner Park on Wednesday to… Continue reading

Linda Tomlinson
Gardening: Leave the lawn until the soil is dry

Spring is arriving, Alberta style with warm days, cold days and snow.… Continue reading

Silent protests were held recently in response to Red Deer Public Schools’ decision to reject a Pride Week in favour of a Diversity Week. Some former employees at Red Deer Public are saying the decision is misguided. (File photo by Advocate staff)
Letter: School board silencing Pride Week concern

While it has been our practice to not comment on matters arising… Continue reading

Anderson scores twice as Canadiens down Oilers 4-3

Anderson scores twice as Canadiens down Oilers 4-3

New York Liberty guard Kia Nurse (5) shoots next to Indiana Fever's Kamiah Smalls during the first half of a WNBA basketball game Thursday, Sept. 10, 2020, in Bradenton, Fla. Nurse isn't just one of Canada's finest female basketball players, she's becoming a popular voice of the game as well. THE CANADIAN PRESS/AP -Phelan M. Ebenhack
Canadian basketball star Nurse is carving out space in sports broadcasting at just 25

Canadian basketball star Nurse is carving out space in sports broadcasting at just 25

The D.C. Defenders, right, line up against the Seattle Dragons for the opening kickoff of the opening football game of the XFL season, in Washington, Saturday, Feb. 8, 2020. Despite heated social media discussion in Canada, talks between the CFL and XFL haven't addressed what rules could be implemented in a potential partnership. THE CANADIAN PRESS/AP-Stephen Whyno
CFL commissioner Ambrosie says talks with XFL have centred around business, not rules

CFL commissioner Ambrosie says talks with XFL have centred around business, not rules

Former B.C. university rowing coach ‘deeply sorry’ after complaints

Former B.C. university rowing coach ‘deeply sorry’ after complaints

Canada's Brianne Jenner (19) and Russia's Anna Shibanova (70) battle for position in front of Russia goaltender Alexandrova Nadezhda (31) during third period IIHF Ice Hockey Women's World Championship preliminary round action in Plymouth, Mich., on Monday, April 3, 2017. The women's world hockey championship in Nova Scotia has been cancelled a second time because of COVID-19. THE CANADIAN PRESS/Jason Kryk
Women’s world hockey championship in Nova Scotia cancelled again

Women’s world hockey championship in Nova Scotia cancelled again

Canada's Meagan Duhamel and Eric Radford compete in the pairs figure skating free program at the Pyeonchang Winter Olympics Thursday, February 15, 2018 in Gangneung, South Korea. THE CANADIAN PRESS/Paul Chiasson
“Once in a lifetime opportunity” – Radford, James are Canada’s newest pairs team

“Once in a lifetime opportunity” - Radford, James are Canada’s newest pairs team

Most Read