Released February 11, 2025 | SUGAR LAND
en
Written by Daniel Graeber for Industrial Info Resources (Sugar Land, Texas)--The oil and gas industry was among the major drivers of job growth in Texas last year, but the Federal Reserve Bank of Dallas said in something of a recurring theme that growth was rather sluggish.
The Dallas Fed found that 244,000 jobs were added to Texas payrolls last year, a 1.7% increase from 2023 levels.
"Job growth was generally broad-based across sectors, with strong gains seen in oil and gas, financial services and construction," said Jesus Canas, a senior business economist at the Dallas Fed.
Job growth, however, was suppressed relative to the year-over-year gain of 2.4% in 2023. And over the three-months ending in December, the Dallas Fed's leading job's index showed a decline.
"The index was dragged down by declines in the U.S. leading index, average weekly hours, real oil price, well permits and an increase in the Texas value of the dollar," the Fed's jobs report on Friday said.
Oil prices were largely range-bound for much of 2024, with West Texas Intermediate, the U.S. benchmark for the price of oil, rarely trading higher than $80 per barrel. Natural gas prices also traded at record lows last year.
Duke Energy Corporation (NYSE:DUK) (Charlotte, North Carolina) and Chesapeake, which later merged with Southwestern Energy Corporation to form Expand Energy Corporation (NASDAQ:EXE) (Oklahoma City, Oklahoma), both announced layoffs last year. Major energy firms also have turned in less-than-stellar performances over the last few quarters.
Jeff Miller, the top executive at Halliburton Company (NYSE:HAL) (Houston), said in the company's fourth quarter report that he expected North American operations would be "softer" this year. SLB (NYSE:SLB) (Houston), an industry peer formerly known as Schlumberger, reported fourth-quarter net income of $1.1 billion, down 8% from the third quarter and down 2% year-over-year.
Operators, meanwhile, are doing more with less in their drilling operations by utilizing multi-bore wells to improve efficiency. Both oil and gas production are on pace to increase this year, but gains are slow relative to a previous boom cycle in the early 2000s.
In its January market report, the Energy Information Administration (EIA), the data arm of the U.S. Department of Energy, said it expected to see a downturn in crude oil production, suggesting there could be a lower employment outlook going forward.
"Production outside of the Permian region in the Lower 48 states will remain flat in 2025, and we forecast it will decrease by about 170,000 b/d (-4%) in 2026," the January report read. "The declines in other regions are because of reduced drilling and completion activity, partly in response to lower crude oil prices."
The outlook for jobs in Texas has been dim since at least the second half of last year, with the statement on oil and gas from Canas, the senior economist at the Dallas Fed, nearly identical to comments from November.
Independently combing through federal data, the Texas Independent Producers & Royalty Owners Association found that energy sector jobs were mostly coming from the retail side, with the Love's fueling chain among the stronger employers over the likes of big energy companies like Chevron Corporation (NYSE:CVX), whose new home is Houston.
Many energy sector outlooks on pricing were written before Donald Trump returned to the White House for a non-consecutive second term. Trump supports more oil and gas production, though private energy companies are beholden to their shareholders.
Some jobs, meanwhile, may be at risk due to executive orders that put limits on renewable-energy programs. Trump's proposed tariffs also could prove a net drag on the U.S. economy. Nationally, job growth slowed more than expected in January.
The Texas economy is the second largest in the nation after California's, with last year's gross state product at about $2.7 trillion. If it were a nation, its economy would rank in the Top 10 worldwide.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) platform helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking more than 200,000 current and future projects worth $17.8 trillion (USD).
The Dallas Fed found that 244,000 jobs were added to Texas payrolls last year, a 1.7% increase from 2023 levels.
"Job growth was generally broad-based across sectors, with strong gains seen in oil and gas, financial services and construction," said Jesus Canas, a senior business economist at the Dallas Fed.
Job growth, however, was suppressed relative to the year-over-year gain of 2.4% in 2023. And over the three-months ending in December, the Dallas Fed's leading job's index showed a decline.
"The index was dragged down by declines in the U.S. leading index, average weekly hours, real oil price, well permits and an increase in the Texas value of the dollar," the Fed's jobs report on Friday said.
Oil prices were largely range-bound for much of 2024, with West Texas Intermediate, the U.S. benchmark for the price of oil, rarely trading higher than $80 per barrel. Natural gas prices also traded at record lows last year.
Duke Energy Corporation (NYSE:DUK) (Charlotte, North Carolina) and Chesapeake, which later merged with Southwestern Energy Corporation to form Expand Energy Corporation (NASDAQ:EXE) (Oklahoma City, Oklahoma), both announced layoffs last year. Major energy firms also have turned in less-than-stellar performances over the last few quarters.
Jeff Miller, the top executive at Halliburton Company (NYSE:HAL) (Houston), said in the company's fourth quarter report that he expected North American operations would be "softer" this year. SLB (NYSE:SLB) (Houston), an industry peer formerly known as Schlumberger, reported fourth-quarter net income of $1.1 billion, down 8% from the third quarter and down 2% year-over-year.
Operators, meanwhile, are doing more with less in their drilling operations by utilizing multi-bore wells to improve efficiency. Both oil and gas production are on pace to increase this year, but gains are slow relative to a previous boom cycle in the early 2000s.
In its January market report, the Energy Information Administration (EIA), the data arm of the U.S. Department of Energy, said it expected to see a downturn in crude oil production, suggesting there could be a lower employment outlook going forward.
"Production outside of the Permian region in the Lower 48 states will remain flat in 2025, and we forecast it will decrease by about 170,000 b/d (-4%) in 2026," the January report read. "The declines in other regions are because of reduced drilling and completion activity, partly in response to lower crude oil prices."
The outlook for jobs in Texas has been dim since at least the second half of last year, with the statement on oil and gas from Canas, the senior economist at the Dallas Fed, nearly identical to comments from November.
Independently combing through federal data, the Texas Independent Producers & Royalty Owners Association found that energy sector jobs were mostly coming from the retail side, with the Love's fueling chain among the stronger employers over the likes of big energy companies like Chevron Corporation (NYSE:CVX), whose new home is Houston.
Many energy sector outlooks on pricing were written before Donald Trump returned to the White House for a non-consecutive second term. Trump supports more oil and gas production, though private energy companies are beholden to their shareholders.
Some jobs, meanwhile, may be at risk due to executive orders that put limits on renewable-energy programs. Trump's proposed tariffs also could prove a net drag on the U.S. economy. Nationally, job growth slowed more than expected in January.
The Texas economy is the second largest in the nation after California's, with last year's gross state product at about $2.7 trillion. If it were a nation, its economy would rank in the Top 10 worldwide.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) platform helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking more than 200,000 current and future projects worth $17.8 trillion (USD).
