The People of America's Oil and Natural Gas Indusry

Human Capital

Jane Van Ryan

Jane Van Ryan
Posted June 19, 2009

The oil and natural gas industry provides excellent opportunities for its employees. The work is challenging, and the salaries are an estimated two- to three-times the national average. Still, the industry is facing an employment crisis. The workforce is graying, and the number of experienced employees is declining as many reach retirement age.

According to studies, more than one-third of the technical workforce in the exploration and production sector of the oil and natural gas business is over age 50. The American Association of Petroleum Geologists says there has been a 70 % decline in students seeking degrees in geosciences since the 1980s. Despite the fact that the oil industry has many technical jobs, only 27 % of the workforce is below the age of 40. In contrast, 59 percent of the employees in the software industry are 20 to 40 years of age.

Similar concerns have been raised about the number of skilled construction workers. According to Mark Ayers, president of the Building & Construction Trades Department at the AFL-CIO, 22 percent of his union's members are unemployed today due to the recession. When the economy rebounds, will they have the needed skills and training and able to go to work?

The new organization established by API and 15 labor unions focuses on skills training and workforce development in order to fill the positions that are expected to become available. It also seeks to create new jobs. As a recent ad explains, "America is rich in untapped energy, and developing federal oil and natural gas resources to the maximum extent possible could create more than 160,000 new jobs, many of them in refinery and pipeline construction."

There's no doubt that America will need more energy in the future. And it's clear that jobs are critically important. By working together, the oil and natural gas industry hopes to meet the nation's energy needs and put America back to work.

View the video below, which documents the signing of the historic agreement between the industry and labor.

You can also listen to a special episode of Energy Tomorrow Radio using the player below.

ETR 84 Oil and Natural Gas Industry Labor-Management Committee show notes:

*Participants include Jack Gerard, API president and CEO; Mark Ayers, president of the Building and Construction Trades Department, AFL-CIO; Douglas McCarron, general president of the United Brotherhood of Carpenters and Joiners of America; and Larry Nichols, API chairman and chairman and chief executive officer of Devon Energy Corp.

00:15 Jane Van Ryan discusses the newly announced Oil and Natural Gas Industry Labor-Management Committee.

00:27 During a recent conference call with reporters and bloggers, two oil and natural gas industry leaders were joined by the presidents of two major unions to explain the purpose of the committee.

00:46 The ultimate goal of this partnership is to secure more, better paying jobs in the oil and natural gas industry and for more Americans in every region of our country. This partnership is based on the belief that an economic recovery is not far away. We want the country to have the energy it needs to keep moving forward and create new jobs for future generations of working men and women.

01:14 The committee plans to launch a communications effort aimed at providing information about legislation that affects the exploration and processing of oil and natural gas.

01:37 Americans want to work and they are desperate for new approaches. Americans will bring back the kind of jobs that not only will put food on their table, but also will pay their mortgages. They understand that government action can only go so far. They are looking, how they always have, to the private sector to bring back hope and economic stability for the United States.

02:11 A recent analysis by ICF International showed that today we could potentially create 160,000 jobs by 2030 with increased oil and natural gas production. In addition to that, there's the potential for $1.7 trillion in additional revenue to federal, state and local governments that comes from this job creation, typical of oil and gas operations.

03:36 The potential to create new jobs is enormous. We have an aging workforce, so the demand to bring in a newer, younger workforce and train them is a problem we deal with everyday. The need is there, the opportunity is there, the jobs are there--we just need to reinvest in America. And part of that investment has to be in oil and natural gas.

04:15 By building a bridge between labor and management, we will be able to shape public policy that that affects the jobs and health of the industry.

04:25 Our nation needs a comprehensive energy policy--one that recognizes the future needs and ensures the availability of affordable energy for both U.S. businesses and consumers.

04:44 Oil and natural gas companies have an effective tax rate of more than 40 percent, much higher than other industries in the manufacturing sector of the U.S. economy.

05:23 We're prepared to address Congress and tell them that over-taxing the oil and natural gas industry will do nothing more than cost hundreds of thousands of workers new jobs.