A third of UK oil and gas firms planning further job cuts this year
06 June 2016
A third of the UK's oil and gas firms were planning further job cuts this year as a result of a slump in prices, according to a new survey.
According to the industry report, from the Bank of Scotland, 43 per cent of companies were planning further cost-cutting measures due to the downturn, with 32 per cent of businesses planning to cut jobs.
Companies in Scotland had taken a bigger hit due to the slump in oil prices, with almost six in 10 saying that their business had been ''severely'' hit, as against a national average of four in 10.
Of the 141 companies questioned for the report, nearly six in 10 had had to introduce efficiency measures or cut costs over the last 12 months while for over a half, this had involved job cuts.
The findings come with a scheduled employment report from Oil and Gas UK due in weeks, which last year revealed that 65,000 oil workers had lost their jobs in just over a year.
Stuart White, of Bank of Scotland, said, "With oil prices currently hovering around the $50 mark there is hope that prices have bottomed out and have begun to slowly and modestly recover, www.pressandjournal.co.uk reported.
''Many businesses however, undoubtedly face more difficult decisions on cost savings, jobs and investment.
The Bank of Scotland / Lloyds Banking Group polled the industry between last December and February.
Of the 141 companies surveyed, 51 per cent had cut jobs over the past year and for Scottish firms, that was true of 63 per cent.
In Scotland, 57 per cent of companies surveyed within the industry and its supply chain said they had been severely or quite badly hit by the slump in oil prices, while the corresponding figure for the UK was 41 per cent.
For every one job created last year, there was a loss of six.
According to a quarter of companies, they had grown by diversifying into other sectors. Larger firms were looking to the decommissioning of North Sea equipment.
Small firms aimed to gain more business from renewable energy investments, however, there had been a drop in the expectations that business would come from the shale gas industry.