Economist Forecast More Layoffs In Louisiana Oil & Gas Industry
It's not the news we want to report and it's not the news you want to hear. It is however reality and how we choose to react to it will determine how the next few months will go around Louisiana. More companies are projecting more layoffs for the oil and gas industry in our state. In fact several companies are already making plans to release workers as soon as June.
Loren Scott an economist with LSU tells the Louisiana Radio Network that the lowest gas prices the nation has seen since August of 2014 are continuing to create major economic issues in our state.
A lot of drilling that’s taking place is taking place on the basis of debt, they borrow money to do this and a lot of them have just run up against some debt obligations that they just can’t keep up. So, you’re seeing layoffs like this.
Some companies such as Gulf Island LLC which is based out of Houma and New Iberia based Carbo Ceramics have plans to layoff some three hundred workers between the two companies. Those layoffs are expected to take effect in June.
Scott says the bigger issue is that there are not enough other jobs for these laid off employees to get.
We’ve been in a downturn for some time, we’re now losing jobs at a rate of 21,000 a year. That’s really heavily concentrated in Houma and Lafayette.
While not the best case scenario the job market in Baton Rouge and Lake Charles has seen an upturn in construction jobs. Perhaps some of those affected workers could find a job in those communities. Of course that would mean the extra expense of travel to and from work.
Meanwhile the projection for a turn around in the oil and gas industry appear to be bleak as even the major companies are beginning to consider plans to put their drilling operations on hiatus or stopping completely until the market becomes more profitable.