Fifty-five percent of executives from 137 oil and gas firms expect their head count to remain unchanged from December 2022 to December 2023, the first quarter 2023 Dallas Fed Energy Survey has revealed.
Thirty-three percent of those executives anticipate that their headcount will increase slightly, seven percent expect that it will decrease slightly, four percent expect that it will increase significantly, and one percent expect that it will decrease significantly, according to the survey.
Of the 137 oil and gas firm executives, 87 were from exploration and production (E&P) firms while 50 were from oil and gas support services firms, the survey highlighted. Looking at the responses from just the E&P firm oil and gas executives, the survey revealed that 66 percent of these respondents expect their headcount to stay the same, 25 percent anticipate it will increase slightly, six percent expect that it will decrease slightly, two percent expect that it will increase significantly, and one percent expect that it will decrease significantly.
Looking at just oil and gas support service firm responses, the survey outlined that 46 percent of oil and gas executives at these companies expect their headcount to increase slightly, 36 percent expect it to remain the same, 10 percent expect it to decrease slightly, six percent expect it to increase significantly, and two percent expect it to decrease significantly.
The first quarter 2022 Dallas Fed Energy Survey, which was released in March last year, revealed that 51 percent of executives from 134 oil and gas firms expected their workforce to remain the same from December 2021 to December 2022.
Thirty-seven percent of those executives expected that their headcount would increase slightly, seven percent expected that it would increase significantly, three percent expected that it would decrease slightly, and one percent expected that it would decrease significantly, the survey showed.
Of those 134 oil and gas firm executives, 84 were from E&P firms while 50 were from oil and gas support services firms, that survey revealed. In the first quarter 2022 Dallas Fed Energy Survey, 63 percent of E&P firm executives anticipated that their staff counts would remain the same, 31 percent expected it to increase slightly, five percent expected it to decrease slightly, one percent expected it to decrease significantly, and zero percent expected it to increase significantly.
The first quarter 2022 Dallas Fed Energy Survey also showed that 48 percent of the 50 oil and gas support service firm executives anticipated that their headcount would increase slightly. Thirty-two percent expected it to remain the same, 18 percent expected it to increase significantly, two percent expected it to decrease significantly, and zero percent expected it to decrease slightly, that survey showed.
Labor Issues
Labor issues were highlighted several times in a ‘comments’ section of the latest Dallas Fed Energy Survey, which the survey outlined showed comments from respondents’ completed surveys that had been edited for publication.
“We expect oil and gas production to decline in 2023 due to higher drilling and completion costs. The significant factor is the lack of qualified employees,” a comment from one E&P company noted, according to the survey.
“Scarcity of labor, increased cost of materials and supplies, domestic and foreign political risk, demand volatility and economic uncertainty domestically have each contributed to an environment that is difficult to work and make plans in going forward,” commented another one, the survey showed.
One support services firm is said to have commented, “the persistent labor shortage in the Permian Basin shows no signs of easing. It is very difficult to fill mechanical and electrical positions with local residents. Our company is relying on shift workers from out of state to fill these spots due to the shortage of local qualified workers”.
Another is said to have commented, “labor remains the most significant challenge. Activity and revenues would be higher with additional employees. The lack of labor is also impacting vendors and turnaround times”.
“Finding workers is getting harder and harder,” another support services firm commented, according to the survey.
The Dallas Fed conducts the Dallas Fed Energy Survey quarterly to obtain a timely assessment of energy activity among oil and gas firms located or headquartered in the Eleventh District, the survey notes.
To contact the author, email andreas.exarheas@rigzone.com
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