Nationally, Petroleum Engineering job advertisements were down 32.4% January 2015 compared to January 2014. Petroleum was a singular outlier among all engineering disciplines, which were up a little over 9% in number of job ads vs the previous year. But perhaps more significant than the percentage drop is how steady the decline has been over the last five months.
Where Lost Oil Jobs will be Felt Most
Only 5 states account for 78% of all advertised petroleum engineering jobs – Texas, Oklahoma, Colorado, California and Pennsylvania. And at the city level, just 14 nationally account for more than half (51.43% since April 2013) of petroleum engineering jobs.
In order, they are:
- Houston, TX
- Pasadena, TX
- Arvada, CO
- Westminster, CO
- Denver, CO
- Lakewood, CO
- Golden, CO
- Thornton, CO
- Aurora, CO
- Irving, TX
- Boulder, CO
- Arlington, TX
- Oklahoma City, OK
- Moore, OK
Houston, You Have a Problem
The Greater Houston metro area accounts for more than 25% of all Petroleum Engineer hiring nationally. And in January 2015 Houston’s Petroleum Engineering job advertisements were down 43.81% over the previous January – marking the most aggressive month-vs-month decline to date.
The ripple effect of falling oil prices effects not just current energy employees and their families; but real estate, construction, and – as we’ll see examine a moment – students, too.
Tabulating Losses by Location
Comparing the number of petroleum engineering job advertisements daily in the top 14 cities from January 2014 to January 2015, the losses aren’t limited to Houston.
With a median salary of $160,000 a year – each lost Petroleum Engineering job represents a significant loss to the local economy. Communities from suburban Denver to Pittsburgh will feel the pinch, but this is what the losses look like in raw numbers across the top 14 Petroleum Engineering communities:
The Coming Dilemma for Petroleum Engineering Undergrads
For the last several years Petroleum Engineering has topped nearly every list of highest-compensated undergraduate degrees.
It will come as little surprise that the degree is swelling with graduates (unsustainably so?) – having produced 1079 in SY2013 alone.
According to the ASEE:
Of the many disciplines showing healthy gains in enrollment between 2012 and 2013, Petroleum Engineering saw the largest undergraduate increase, 23 percent.
In the face of so much employment optimism and a 9.4% overall increase in advertised engineering jobs from the final quarters 2013 to 2014, petroleum engineering students remain worried.
“It’s time for me to do a reassessment of how I plan to begin my career,” said Vince Miller, a senior at Ohio State University studying chemical engineering and president of the school’s Society of Petroleum Engineers chapter.
Is this a farewell to high salaries in Petroleum Engineering?
Probably not. Energy jobs are known for boom-and-bust cycles. Many recruiters and employers think oil will return to $100 a barrel within a year or two.
But could it be damaging to the opportunities of this, and next year’s, petroleum engineering graduates? Yes, in the immediate term, as our data suggests.
And in the medium-to-long-term an exodus of entry-level petroleum engineering talent this year and next into something other than the Oil & Gas industry could spell a shortage of skilled mid-career petroleum engineering talent 5-7 years down the line.
That is, of course, assuming Mr. Pickens is right.
Image credit: BP