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Job losses continue to hit oil and gas sector

Global hiring managers report that they have not seen an increase in the number of candidates seeking a salary increment

The oil and gas sector continues to shed jobs worldwide as low prices are forcing companies to cut costs and shelve projects to survive the downturn.

A roughly 50 per cent drop in prices since June 2014 has impacted oil majors such as Baker Hughes, Schlumberger and Halliburton, who went on to announce plans to lay off thousands of workers this year.

Last month, Denmark’s Maersk announced plans to slash 200 jobs in its oil unit due to a drop in the oil price and to reduce operating costs by 20 per cent over the next two years.

According to figures published in Forbes recently, the global oil and gas industry – including oil field services companies, parts manufacturers and steel pipe makers – has axed more than 75,000 jobs so far.

While data on the extent of job losses in the Gulf region is not yet available, experts confirm that the oil and gas may not be the sector one should be looking to for jobs this year.

Paul G Morris, Managing Director (Europe, Middle East and Africa) at HR consulting firm Towers Watson, tells AMEinfo: “Oil and gas may not be the sector that you would look for jobs in this year. Oil prices are certainly having an impact in the industry. Companies cutting costs will have a ripple effect on the rest of the economy. There is definitely going to be a drag in the job market.”

The current market conditions have prevented professionals from demanding higher salaries.

According to Rigzone’s latest global hiring survey published last month, more than 55 per cent of global hiring managers report that they have not seen an increase in the number of candidates seeking a salary increment in the first three months of 2015.

There is no doubt that the industry remains cautious in the face of the ongoing market volatility and low oil prices.

The Rigzone survey, which polled industry recruitment managers worldwide, shows that 47 per cent of respondents indicated reduced hiring plans in the first three months of the year, while an additional 16 per cent say they had completely halted their hiring plans for the time being.

“In the wake of the economic crisis, people are looking for long-term jobs and that’s where job security is important. And probably the oil and gas sector may face some problems attracting talents in the next couple of years. Professionals would look at the sustainability in the company and the growth prospects in the region,” Morris adds.

Interestingly, the oil-exporting Gulf nations seem to be unperturbed by the sliding prices and the tensions in the industry.

Saudi Arabia, UAE, Kuwait and Qatar are optimistic about the future of the sector.

It goes without saying that most of the Gulf nations are already focusing on the non-oil sector to drive their economic growth and offset the economic backlashes that may arise due to falling prices.