WANTED: Talented engineer or geoscientist willing to work at the pleasure of a volatile commodities market in an industry whose legitimacy is questioned by world leaders including the US president and Roman Catholic pope.
Does anyone in the oil and gas industry see a recruitment problem here?
The cyclicality hazard
Cyclicality is a hazard of modern commodities businesses, the oil and gas business no less than others. Its effects can be managed but never avoided. When crude oil loses half its value, as it did in the latter half of 2014, businesses whose profits swing with the price of crude shrink or die. An unfortunate part of the shrinkage involves personnel. Good and productive people lose their jobs.
In the US alone, between October 2014 and last May, 35,000 workers in the oil and gas producing industry and support businesses received layoff notices, according to a June report by the Energy Information Administration. More layoffs have occurred since then. Jobs are dissolving outside the US, too.
Layoffs occur in other industries, of course. But the oil and gas industry imposes special requirements on people: highly developed technical knowledge and operational skill; frequent moves, often to places less than thoroughly appealing; sometimes exposure to mechanical or geopolitical danger. The past several slumps in the price of crude came fast and hard. Oil and gas careers have become wild rides.
By itself, volatility of the oil market gives technically skilled young people a reason to seek jobs in tamer businesses. The industry can’t do much about that except make work sufficiently interesting and remunerative when conditions are good to compensate for when they’re not. For the other problem, external challenges to legitimacy, it can do more.
Much of the political world is swooning to the seductions of carbon-free energy. To save the world from catastrophic warming, the thinking goes, governments must move economies away from oil, gas, and coal toward wind, solar, and biofuels. Costs, in this view, don’t matter. Wealth lost to forgone development of natural resources and coerced use of high-cost energy will be supplanted by profits from the manufacture of windmill blades and solar panels. Adherents of this position seldom ask if this really can be true.
In fact, it can’t. Energy from renewable ideals won’t be available in anywhere near sufficient amounts with acceptable reliability at tolerable cost to displace fossil fuels or to come anywhere close to doing so. But governments can waste a lot of money pretending otherwise.
Meanwhile, official disparagement of fossil energy can turn newly graduated engineers and scientists in large numbers-not to mention scores of their laid-off seniors-away from oil and gas employment. If the pope condemns fossil energy because it hurts poor people, after all, why would anyone want to work in the industry that produces it?
For the sake of its workers, present and future, the oil and gas industry needs to respond.
Its leaders need to challenge the pope. His views on climate change and fossil energy are extreme and ill-informed. The forced rejection of oil, gas, and coal would, in fact, have questionable effect on global warming and definite consequences for energy costs. Elevation of energy costs hurts the poor most.
Important work
Industry leaders need to say so. They need to assert the enormous economic benefits made possible by the development of oil and gas resources and by the delivery to consumers of affordable energy in needed amounts. They need to point out that rejection of those benefits would impose intolerable cost. And they need to declare that people who produce oil and gas, and deliver the associated benefits, perform work hugely important to humanity.
Meanwhile, their companies should continue finding ways to lower emissions of greenhouse gases. Addressing a phenomenon of widespread concern, whatever danger it poses, is important. Even more so is showing what human ingenuity can accomplish when governments resist the urge to control whatever they can.