Did you know that one in five jobs in Oklahoma are related to the Oil & Gas industry? There are hundreds of companies tied to the Oil & Gas industry in our state, with many of them being right here in OKC.
No matter your view on the industry, you have to agree that Oil & Gas is a huge part of our local economy. And, unless you’ve been living under a rock, you’ve noticed that the drop in gas prices at the pump has made quite an impact here.
My husband and I have both worked in Oil & Gas jobs and personally know several others who do as well. Since 2013, my husband has been laid off twice from his job within the industry. The first time was from a major company here in OKC. The hit wasn’t unexpected and the decent severance package that followed made the change manageable.
The second time, the layoff was from a much smaller company where my husband worked as a contract Landman. Again, the hit was not unexpected, but as a contracted employee, he was not even able to file for unemployment while he searched for a new job. We were well aware of the continuous drop in oil prices and knew that another layoff was likely to happen. We planned and prepared as much as we could and were able to survive during his unemployment which lasted through a good part of 2015. In fact, our kids really benefited from having a stay-at-home dad during that time and we did our best to make sure they weren’t seeing the stress that we were feeling.
I recently attended a professional luncheon in which the speaker presented an economic forecast for 2016. The outlook? Grim. Good news for those who only care about getting a cheap tank of gas. Bad news for the thousands of us who work in the industry and face another year of layoffs, reduced benefits, etc. And honestly, bad news for Oklahoma City in general as this is trickling down and affecting more than just the Oil & Gas industry.
Here are 3 reasons why a cheap tank of gas worries me:
- Unemployment. Hundreds (maybe thousands) of people in our state are out of work right now due to low oil prices. It might seem like the evil corporations are doing horrible things to good, hard-working people but, in reality, companies are making decisions so they’ll be able to survive through this down turn. It’s not over yet either. Devon Energy just announced that they have more layoffs planned for the first quarter of this year. Rumors of other companies doing the same are likely to turn out to be true as well. I pray that my family is not impacted by unemployment again this year but the fact is, that may actually happen. It’s happening now to everyone from VP’s in the corporate offices to the oilfield workers out on the rigs. I’m sure many people can relate to feelings of uncertainty regarding their employment. It’s not fun and it’s especially hard when you are working to support a family.
- Stock Prices. Energy related stocks are falling. Did you hear about Sandridge being delisted from the NYSE? Falling stock prices affect the market which, in turn, affect retirement, college funds, etc. I contribute to a 401K and get a statement every quarter. My account has definitely seen a negative impact. Fortunately, I have many more years until retirement so I’m not sweating it too much at this point. Eventually, things will make a turn for the better and I’ll see some gains. Many, however, are seeing losses in funds that they will need to access soon.
- Taxes. Less employees in the workforce and less companies being able to operate translates to less tax revenue for our city and state. This can negatively impact our school districts and the state education budget. My kids are young but my oldest will be starting Pre-K at the public school next year so this is definitely something on my radar.
My prayers are with everyone affected by the downturn in this industry right now. If you are celebrating the low gas prices, I’m genuinely happy that your wallet is feeling better right now. I don’t mind saving money here and there either. Just remember that low gas prices come at a cost and many of our fellow Oklahomans are feeling negative hits because of it.