Increased USA Oil, Gas Output Has Not Translated into More Jobs

Despite record setting production in the U.S. oil and gas industry, increased volumes have not translated into more jobs for either the industry or the overall economy.

That’s what the Institute for Energy Economics and Financial Analysis (IEEFA) said in a statement sent to Rigzone recently, adding that, according to a new report from the institute, the industry employs 20 percent fewer workers than it did a decade ago.

“Over the last 10 years the oil and gas industry has shed 252,000 jobs,” the IEEFA noted in the statement.

“A decade of productivity gains means more oil with fewer workers,” the statement said.

“The number of jobs required to produce a barrel of oil has fallen by half over the last decade,” it added.

A chart included in the IEEFA statement showed that U.S. oil and gas employment stood at just below 900,000 in 2001, then rose to 1.26 million in 2014 before dropping to just over one million in 2024. The chart cites U.S. Bureau of Labor Statistics data and “modified TIPRO [Texas Independent Producers & Royalty Owners Association] methodology (circa 2014) due to NAICS revisions” as sources.

“A stark pattern of declining employment in the oil and gas industry has taken shape over the last decade that has rippled out to have broader effects on regional economies,” Trey Cowan, an oil and gas energy analyst at IEEFA and the author of the IEEFA report, said in the statement.

“Even taking into account the cyclical nature of the industry, over time employment losses seem to be outweighing employment gains,” he added.

The IEEFA report went on to warn that, “amid steep layoffs and forecasts of prolonged low oil prices, the U.S. oil and gas industry could soon employ fewer people than it did before the onset of the shale revolution”.

Rigzone has contacted the American Petroleum Institute (API) and the U.S. Department of Energy (DOE) for comment on the IEEFA statement. At the time of writing, neither have responded to Rigzone.

A data page on the U.S. Energy Information Administration (EIA) website displaying annual U.S. field production of crude oil – which was last updated on September 30, at the time of writing, and which includes data from 1859 to 2024 – showed that annual U.S. field production of crude oil averaged 13.235 million barrels per day in 2024. That figure is the highest in the data set.

Prior to 2024, annual U.S. field production of crude oil had never averaged 13 million barrels per day or more, the data revealed. The closest it came to an annual average of 13 million barrels per day was in 2023, at 12.943 million barrels per day, the data showed.

Another data page on the EIA website displaying annual U.S. dry natural gas production –  which was also last updated on September 30 at the time of writing and which includes data from 1930 to 2024 – showed that annual U.S. dry natural gas production averaged 37.767 trillion cubic feet last year. This is the second highest figure in the data set, with the highest coming in 2023, at 37.803 trillion cubic feet. Back in 2020, U.S. dry natural gas production averaged 33.811 trillion cubic feet, the data showed.

The IEEFA states on its website that it examines issues related to energy markets, trends, and policies. On its site, the IEEFA notes that its mission is “to accelerate the transition to a diverse, sustainable and profitable energy economy”.

The EIA describes itself on its site as the statistical and analytical agency within the DOE. The organization states on its site that collects, analyzes, and disseminates independent and impartial energy information to promote sound policymaking, efficient markets, and public understanding of energy and its interaction with the economy and the environment.

To contact the author, email andreas.exarheas@rigzone.com