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Oil & Gas UK said in its workforce report on Thursday. The report, however, notes a slight increase in overseas jobs for 2018.
The industry body found that the biggest reduction in the offshore workforce came from marine drillers, as drilling activity fell to a record low. The 2017 numbers were explained by the drop in oil prices. Oil and Gas UK pointed to the fact that the price of oil has fallen from around $109 per barrel (bbl) in mid-2014 to an average of $54/bbl in 2017, leading to a significant contraction across the sector.
“In the aftermath of the price drop, oil and gas companies have had to modernize and rationalize to sustain their businesses and focus on improving efficiency in response to the prevailing business environment. This inevitably had a negative impact on employment, both from reduced activity and efforts to cut costs,” the report reads.
According to data from OGUK, employment in the UK offshore oil and gas industry peaked in 2014 at over 450.000 jobs.
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“However, there was a sharp drop in 2015 when employment declined to around 380.000. Latest estimates for 2016 and 2017 show employment levels supported by industry falling to levels not previously seen since 2010/11, with 280.000 jobs estimated to be supported by oil and gas activity in 2017…” Oil and Gas UK said.
Employment increase for 2018
The industry body now, for the first time in four years, forecasts a slight increase in employment in 2018 as the industry continues to improve its competitive position.
“Total employment is expected to increase by nearly 3.000 jobs over the year to 283.000, up from 280.000 a year earlier.”
“This comes after total industry-supported employment fell by 14% in 2017 – below previous estimates of 302, as the downturn continued to be felt across the supply chain. Rising levels of investment have been seen in the sector but have been slow to seep in,” OGUK said.
The industry body said today that broader workforce trends are indicating an industry working to deliver by 2035, efficiency improvements and technological transformation, hinting at new ways of working for the UK's oil and gas sector. The report shows that the average age of the offshore workforce has dropped over the past year, with a 20% increase in foreign workers under 30.
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