More Oil Industry Layoffs Hit TX

The rapid increase in domestic oil production in recent years helped fuel a banner year for Texas' economy in 2014. Not only did the Lone Star State lead the nation in the total number of jobs created last year, but it finished second -- behind far, far smaller North Dakota -- with a 4 percent growth rate compared...

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The rapid increase in domestic oil production in recent years helped fuel a banner year for Texas' economy in 2014.

Not only did the Lone Star State
lead the nation in the total number of jobs created last year, but it finished second -- behind far, far smaller North Dakota -- with a 4 percent growth rate compared to 2013.

As the price of oil has
plummeted to less than half its summer value, however, the industry continues to bear the brunt of job cuts.

In recent days, a trio of oil companies informed state officials they plan to lay off hundreds of employees.

The largest round will take place at GE Oil & Gas, which will
cut 330 jobs in Lufkin, where it manufactures pumps for oilfields. Producers have been idling oil rigs nationwide in response to the price drop; GE, meanwhile, announced this week it would bolster its presence in Kuwait's oil industry.

Oilfield services companies Lariat Services and Trican Well Service, meanwhile, will
lay off 265 employees and 125 employees, respectively, in the Lone Star State. Those follow massive cuts at Houston-based industry giants Schlumberger, Halliburton and Baker Hughes.

In addition, Houston petroleum company ConocoPhillips
expects layoffs following losses in its latest quarterly report.

All told, analysts say Texas could lose some
50,000 industry jobs and that a recovery could take up to two years.

That's led to tempered expectations from the Federal Reserve Bank of Dallas, which
predicted slower growth due this year to the issues facing the oil industry.

Although the changing crude market has caused problems for the oil industry and related manufacturers, analysts expect the corresponding drop in gasoline prices to boost the U.S. economy overall.

 

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