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ExxonMobil, Major Oil Company in the United States, May Reduce Its Global Workforce by About 15 Percent As the Covid-19 Pandemic Harms Demand and Energy Prices
ExxonMobil reported this week that the company, like other oil producers, would be cutting costs due to a collapse in oil demand and poorly timed new projects. The leading oil company in the United States anticipates more than US$ 10 billion in budget cuts this year.
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“The impact of Covid-19 on the demand for ExxonMobil’s products has increased the urgency of ongoing efficiency work,” the company told Reuters. ExxonMobil spokesperson Casey Norton said that about 14,000 employees worldwide, or 15 percent, may lose their jobs – including contractors. According to the news agency, the number will include losses due to restructuring, retirements, and performance departures. Exxon had about 88,300 workers – including 13,300 contractors – at the end of last year.
The company does not have a fixed job number goal but expects the result of its ongoing business review to eliminate about 15 percent of its current workforce.
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The major U.S. oil company will also reduce its workforce in the U.S. by about 1,900 employees. The company said that its management offices in Houston will be primarily affected by the announced workforce reductions.
“Workforce reductions are the result of ongoing reorganizations and changes in work processes that have been made over the past few years to improve efficiency and reduce costs. These actions will enhance the company’s cost competitiveness in the long term and ensure that the company manages the current unprecedented market conditions. The impact of Covid-19 on the demand for ExxonMobil’s products has increased the urgency of ongoing efficiency work. The company acknowledges that these decisions will impact employees and their families and implemented these programs only after comprehensive evaluation and careful deliberation. Employees separated through involuntary programs will receive support, including severance and outplacement services,” ExxonMobil told Reuters.
Shell and BP also outlined cuts of up to 15% in their workforce. Another major company, Chevron reported that it plans cuts of 10-15 percent. This would mean a reduction of between 4,500 and 6,750 jobs. It will also cut about 570 positions as part of its recently acquired Noble Energy.
Additionally, Cenovus Energy decided to cut between 20 and 25 percent of its workforce after the acquisition of Husky Energy.
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