Oil worker wages hit U.S record amidst slowing shale activity
(Bloomberg) --Wages for U.S. oil workers climbed for a third straight month, setting a fresh record as paychecks prove resilient amid slowing shale activity.
Average hourly earnings for front-line oil-and-gas workers rose 0.9% in September from the previous month to $43.63, according to a Labor Department report released Friday. Compared with a year ago, oil pay is up 5.7%. The move bucked a national trend.
Oil companies are fighting off the costly effects of aging U.S. oil fields as wells become less productive. With drilling down 19% since the start of the year, output from the seven biggest shale regions is forecast to drop from September through November, the U.S. Energy Information Administration said last month.
“The upstream E&P industry is in a slow-to-no growth environment where the appetite for capacity expansion throughout the hydrocarbon value chain is low,” Sam Sledge, Chief Executive Officer for the frack-services provider ProPetro Holding Corp., told investors this week on a conference call. “The recent transactions in the E&P space reinforce that our disciplined approach to capital deployment is the right strategy for ProPetro.”
The jobless rate in oil and natural gas jumped to 6.1% in October on an unadjusted basis, government figures show. That compares with an unemployment rate of 0.8% a year earlier and is higher than the overall U.S. level. It’s the second time this year that oil field unemployment has ticked above 6% as the industry rate appears more volatile than the national trend.
The overall number of workers employed in the industry rose for a fourth straight month to 119,100 in October.
Shale fields are getting more expensive to develop amid dwindling inventories of top-tier targets and limited supplies of drilling and fracking gear, BloombergNEF said last month.