Canadian Manufacturing

Survey shows two thirds of energy company employers cut labour costs due to COVID-19

The survey found that 35% of the companies invoked a hiring freeze

November 23, 2020  The Canadian Press

CALGARY — A survey by energy labour market organization PetroLMI shows that more than two-thirds of the employers in Canada’s oil and gas sector imposed labour cost reduction measures in the wake of the COVID-19 pandemic lockdowns, including 37% who enacted permanent layoffs.

The division of Energy Safety Canada surveyed 300 energy industry workers in August and September and interviewed 13 company leaders in September and August for its four-part report looking into industry reaction to lockdowns that slashed global oil demand, leading to rapidly falling oil prices.

“Due to the sudden economic impact resulting from the COVID-19 pandemic after five years of depressed oil prices, energy employers had to find ways to reduce operating costs,” the report notes.

“While nearly four in 10 energy workers surveyed said their company implemented permanent layoffs, many companies were seeking alternatives to layoffs.”

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The survey found that 35% of the companies invoked a hiring freeze, 29% cut executive pay, 28 per cent trimmed worker pay, 27% had temporary layoffs and 21% restricted work hours.

Only 32% did nothing to reduce labour costs.

The survey found that only 13% of energy workers worked from home at least one day per week before COVID-19, but that rose to 70% in March, with 57% working from home at least five days a week.

“Historically, the oil and gas industry has not typically been known for its flexible work policies, particularly the ability to work from home,” said PetroLMI analyst Lisette Cameron during a webinar on Nov. 20.

“So it’s not a huge surprise when we asked energy workers how often they worked from home prior to the pandemic, about seven in 10 said they never work from home and only eight per cent said they work from home five or more days per week.”

At the time of the survey in August and September, 47% were still working from home at least one day per week and 31% were working from home five or more days per week.

On its website, PetroLMI notes that oil and gas employment increased by 4,450 jobs in October to 164,590 compared with September, but was down 12% or 21,400 jobs from October 2019.