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The Layoffs Return: Energy Giants Chevron, Saipem To Fire Over 10,000 Workers
In the beginning of 2015 the biggest threat to the economy as a result of the collapse in oil prices, both in the US and worldwide, was the surge in layoffs among highly-paid energy sector job. This was confirmed in April when we showed the Challenger layoffs data for the energy-heavy state of Texas, and the energy sector in general where the 37,811 job cuts in Q1 were some 3,900% higher than a year earlier.
Then in Q2, after the price of oil staged a substantial rebound of about 50% from the year to date lows in the $40's, energy-related layoffs trickled to a halt as corporations hoped the worst is behind them, and as a result would merely bide their time before redeploying their workforce toward exploration and production.
Alas, this was not meant to be, and as the events of the last month have shown, oil has resumed its downward slide. And, as expected, so have layoffs.
Overnight, US energy major Chevron announced it will cut 1,500 jobs globally "as the company aims to reduce internal costs in multiple operating units and the corporate center." According to Rigzone, "the San Ramon, Calif.-based energy company will cut 950 positions in Houston, 500 positions in San Ramon and 50 positions internationally."
Chevron is cutting jobs due to the current market environment and is “focused on increasing efficiency, reducing costs and focusing on work that directly supports business priorities,” Chevron spokesperson Melissa Ritchie said in an email to Rigzone.
Chevron will be cutting 1,500 employee positions across the 24 groups that comprise the corporate center; 270 of the positions are existing vacancies that will not be filled. Additionally, 600 staff augmentation contractor positions will be cut in the corporate center.
The cost reductions due to cuts in the corporate center are expected to total $1 billion with additional cost savings expected across the company.
Ritchie said Chevron’s cost-cutting initiatives are currently underway and will continue in coming months. The company plans to have a majority of the cuts completed by mid-November of 2015 as well as cost-saving initiatives in place by 1Q 2016.
As a reminder, Chevron was the first major which in January suspended its stock buyback blaming the collapse in cash flows. Is the dividend next?
But it's not just the US, because moments ago Italy's biggest oil and gas industry contractor Saipem announced that not only is it cutting its guidance, sending its stock plunging, but also reported that it plans to cut 8,800 workers by 2017.
According to ANSA, the reductions are part of a restructuring plan that follows more than 900 million euros in writedowns.
The company, which is 43% owned by energy giant ENI, says it has been hit hard by the global collapse in oil prices.
The company revised down its 2015 outlook but said it expected its restructuring plan to save 1.3 billion euros over two years. It said it now expects to post a net loss this year of about 800 million euros.
But the return of the "energy sector turmoil" on the labor market won't be complete until hollow chatterboxes once again start predicting how the latest crash in energy prices is "unambiguously good" for if not the economy, then the US consumer: a consumer who was supposed to take his "gas tax" savings and spend them. Only that never happened because, drumroll, it snowed, and the result was a first half of retail sales that has been one of the worst 6 month periods for the economic series on record.
The only good news is that soon even more unemployed former energy workers will be allowed to confirm for themselves just how "unambiguously good" it is when the world's most important and most traded commodity enters its second bear market in under one year.
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Ouch
Zorg says to fire 500,000.....
That should really drive the unemployment rate down.
... everything is bigger in Texas ...
But just think of the productivity gains from the remaining workers. Kudlow just got rock hard!
Oh, the "Hope and Change" of it all! Isn't it glorious what the best president evah' has created! /sarc
They all instantly left the workforce, Vince, so they're not counted any more.
Every society has it's "invisible" class. That's ours.
#demanddestruction
#deglobalization
It is not just oil companies....BBC fired 1,000.....Virgin Atlantic fired 500 ....Thai Airways fired 1,400....Vodafone in Spain is firing 1,300.....Quirky in NYC is firing 100....Australian mines are firing hundreds...Anglo in South Africa fired 6,000...JohnDeere fired 160...Encana cut 200 in Calgary...
http://gadgets.ndtv.com/telecom/news/vodafone-plans-up-to-1300-job-cuts-...
http://www.news.com.au/finance/business/miners-brace-for-job-cuts-mine-c...
http://www.bizjournals.com/albany/news/2015/07/28/quirky-announces-more-...
http://www.cnbc.com/2015/07/26/thai-airways-axes-1400-jobs-halts-flights...
http://www.bbc.com/news/entertainment-arts-33363225
http://www.reuters.com/article/2015/06/30/us-virgin-atlantic-redundancie...
http://news.sky.com/story/1524558/anglo-american-to-cut-6000-jobs-as-pro...
http://magicvalley.com/business/agriculture/deere-lays-off-employees/art...
http://calgaryherald.com/business/energy/encana-builds-58-million-fund-f...
Mining job cuts: The destructive anarchy of the capitalist markettell me again how bad America is and how great Dubai.
i think you were advising investing in China right?
I still advise China...have been doing so since at least 2010....never said anything about Dubai...please don't assume!
I still advocate investing in China as much as I suggest to diversify and invest everywhere else.
Investing in China does not mean you sell your house and invest there.....
Shanghai exchange is still 80% up in 1 year and about 88% up in 2 years as well.
"1 millon!"
Ouch squared, how do like me now?
http://www.bizjournals.com/houston/news/2015/07/27/halliburton-baker-hug...
All part of the rekovery.
Instead of saying their employees are laid off or fired, Chevron should say the employees are sequestered. Notice how Chevron's layoffs are almost all in the USA. Other countries, like the UK and France, make it expensive to lay off long term employees. In the USA, the bogus "employment at will" doctrine rules, treating employees like disposable trash.
Luckily, the Fed forecasts the unemployment rate will stabilize at 5% till 2050.
Luckily the official unemployment rate is only 5.3%. So every laid off workers can find three jobs at twice the salary. Or two jobs at thrice the salary.
Everything is always perfect in the land of the free, not just above average as in Lake Wobegon - especially economic statistics.
It's paradoxical!
The more people companies fire, the lower the unemloyment rate goes!
It's VoooDoo!
That will be good for a 30 pt rise on the S&P. JObs? we don't need no steeenking jobs.
MIning destroyed- Check
Coal, Natty gas, oil, Energy production destroyed -Check
Construction Industries destroyed-Check
U S Manufacturing destroyed-Check
Retail destroyed- Check
Steel, copper, shipping, heavy equipment,lumber,/logging check, check, check and check
What am I at, about 70% of the 9000 or so listed companies? And Yellen has to raise .25 to slow this runaway freight train down. LOL
You want some fries wid dat quarter pounder wid goverment cheese?
"I think I have been a pretty good President" Obummer. These stupid fucks in charge could'nt create a job at a snow cone stand.
END of rant.
Best recovery ever...... evar.
Obviously, Obamunism is winning, so...moar! Er, Forward!
Moar!!!
Wait until the robots get hacked. Kaboom to the site. Lost revenue.
Somebody better tell Texas that Wall St. dun messed with 'em.
Being an energy sector worker for the last 12 years here is what o have done to combat the weakening job market:
Sold my house ahead of the stampede. (Made Cdn$94k)
Got a job in the gold mining sector. (A return to a former job)
Bought gold with my house proceeds. (Spend half )
Considering taking a Cdn$2500.oo Bitcoin position.
Actually living at a gold mining camp and am technically homeless until the mining season here ends...then I'll be actually homeless AND jobless until next season's mining starts back up.
Good, no?
That's funny, I made a similar move. I still work in an energy related field but I took the job I have because my bosses own two gold mines and claim they will move me if things go down hill in their other business. I am considering buying a fifth wheel and living like a gypsy.
That sounds just like my brother-in-law who has been part of a grim reaper team that goes around shutting down oil camps in Alberta for the past six months. On the day of their arrival, pink slips are slid under the oil workers doors in the middle of the night for them to find the next morning. And these aren't just work camps with a couple hundred people, most have 1200 or more. What was most recently a $120K truck driver or a $200K welder job will hardly fetch 1/3 that much once they're back in civilization. Guess they'll have to stretch to make payments on those $600K mortgages or $60K auto loans. He has not seen so many grown men cry in his life.
Fear not, Chevron engineers... Outback Steakhouse is hiring bartenders and wait staff.
How would you like your steak engineered, sir?
Burnt and covered with rice.
And craploads of pepper to mask the low-quality beef.
Fracked and oozing...
http://www.breitbart.com/big-government/2015/07/28/its-on-rep-mark-meado...
Never happen... would be nice to see the asshole get the boot though!
Meadows will be given a closed door "get your mind right session" very soon!
Bathhaus Barry does not use lubricant.
AI is being played as an alternative to human interaction. Watch the drilling holes explode. It will be blamed on Terrorists. Unfortunately, it's the robots fault not being programmed correctly. Source code never lies. Wait til the source code is dumped. The government will cry wolf. The red headed step child will be caught.
Marcy Playground - St. Joe On The School Bus- YouTube
But the president said he thought he was doing a 'good job', and if he ran for a third term, he was pretty sure he could win. Makes sense to me.
“Chevron cuts: … 600 staff augmentation contractor positions will be cut in the corporate center. The cost reductions due to cuts in the corporate center are expected to total $1 billion with additional cost savings expected across the company.”
That's an average of $1.7M per year per job. Now that's some cost cutting of useless jobs!
Sure, ND had 192 rigs in July of 2014 and now has 73 but only 80 were laid off. That may be 2 rigs worth. Rigs run 24 hours a day and would employ at least 50. If I remember right at peak they had 217 rigs.
MORE unemployed - that's good for the unemployment rate right? The more off the payroll - the lower the rate?! Nice.
Demand for all real hard commodities is collapsing for many years now. Since commodities are part of real economy and not paranoid delusions of financial fantasy land, they are indicators of deflation death spiral and social collapse. Now even futures, proxies for faith into global economic growth are collapsing as well.
How come that during last 8 years hundreds of millions of people were born and there is no growth of any kind? Only brain dead economists can utter nonsense like efficiency, so-called technological progress as an answer to that question, denying the fact of global pauperization of human race and sucking out of world economies, lifelines for jobs and incomes of ordinary people while forcing them into debt slavery.
The Saudis price war is all about dwindling demand in the decades into the future and hence they must increase the market share to pump enough and later charge enough to cover their future budgets especially since they lost Chinese market for Iran and Russia.
The same fate of collapse they seek for shale oil and gas.
https://sostratusworks.wordpress.com/2015/01/15/the-shale-game/
They could get jobs building/fixing infastructure, roads, bridges, dams, leevees, renewable energy- solar, wind, hydro!
hahaha just kidding
Any time Obama talks it's a shovel ready job.
Throw that 6 legged dog from ENI a bone!