Signal vs. Noise
One Industry, Two Labor Markets: Why Oil Jobs Crash and Refinery Jobs Don't
Ask whether oil and gas is a good place to work and you will get two answers. Both are right.
"Oil and gas" is one industry name. Inside it are two labor markets that behave nothing alike, and which one you are in decides what a downturn does to you.
The bust
According to the Energy Information Administration's reading of BLS data, oil and natural gas production employment peaked at about 538,000 in October 2014. By May 2016 it was 26% lower, a loss of more than 142,000 jobs. In the 2008–09 recession, the industry lost about 51,000 jobs over 13 months.
The calm
Over the same stretch, the rest of the industry barely noticed.
| Segment | What happened |
|---|---|
| Upstream (extraction and support) | −26% from Oct 2014 to May 2016 |
| Refining (NAICS 324110) | 71.4K in 2014, 71.5K in 2016; −5.7% in 2020 (69.7K to 65.7K) |
| Pipelines (NAICS 486) | 47.9K in 2014, 50.3K in 2016; about −4% in 2021; 56.4K in 2024 |
Sources: EIA; BLS industry employment (annual, thousands) via FRED. The refining series I retrieved ends in 2020.
Nine years later, the same split
The 2020–21 downturn repeated the pattern at the level of individual jobs. BLS counted about 44,700 roustabouts in May 2020 and 34,500 in May 2021, a drop of roughly 23%. It counted 27,850 petroleum engineers in 2020 and 22,100 in 2021, down about 21%.
Then the two seats diverged. Roustabouts were back to about 43,800 by May 2023. Petroleum engineers were not: BLS's 2024 base is 19,600. The door reopened. The profession did not.
Why they split
Upstream spending is discretionary. When the price falls, operators stop drilling, and rig crews and the service companies behind them are the first to go. BLS researchers measured it: from 2014 to 2022, employment in oil and gas drilling swung by 124% of its average level, support services by 76%, and extraction by 60%.
Refineries and pipelines are a different business. My read, and it is reasoning rather than a sourced finding, is that they are paid to run what is already built. A refinery keeps turning crude into fuel and a pipeline keeps moving product, so their payrolls do not move with the rig count.
The part that should bother you
U.S. crude oil production hit a record 13.6 million barrels a day in 2025, up from the previous record of 13.2 million set in 2024. It did so while rig and well activity fell, as the price of West Texas Intermediate dropped from $77 a barrel to $65. EIA credits gains in drilling productivity and operational efficiency. The rig count was 543 in late March 2026, about 8% below a year earlier.
Rigzone reported in October that oil and gas extraction employment had hit a post-pandemic low for September. Output and headcount have come apart. The industry can set a record on fewer rigs and fewer people.
What to do with it
- Ask which labor market the employer is in. The industry name tells you almost nothing. The employer class, whether a drilling contractor or a refinery, tells you most of it.
- Weigh pay against cycle. On our Oil & Gas Board, the two ends of the pay ladder, the roustabout and the petroleum engineer, are the two most exposed. The steadier seats sit in the middle.
- Plan the exit before you need it. The industry's biggest door is also its swingiest one.
The limits: these are industry series, and individual occupations vary. The refining data stop at 2020, so the picture since then is thinner.
Scot Free Take
I keep hearing "oil and gas" used as if it were one job market. It's two.
One is levered to the price. When crude falls, the rigs stop within months and the people who run them go with them. In the last bust that was 26% of the upstream workforce in 19 months. The other is paid to run what's already built. Refineries and pipelines kept their people through the same stretch. Taleb would call the first fragile and the second robust, and he'd say the mistake is treating them as the same asset.
The part that stays with me is the record. U.S. crude output hit an all-time high in 2025 with fewer rigs working than the year before. EIA credits productivity and efficiency. Output and headcount have come apart, and nobody had to invent a chatbot for it to happen. That's what engineering does to a labor market.
So when someone asks me whether oil and gas is a good place to work, I ask which half. Then I point them at the Cycle Exposure box, because that's what it's for.
Know which labor market you're in before you pick the seat.
Sources
- U.S. Energy Information Administration, "Oil and natural gas production jobs in May were 26% lower than in October 2014," Today in Energy, August 5, 2016 (BLS Current Employment Statistics).
- BLS industry employment series for petroleum refineries (NAICS 324110) and pipeline transportation (NAICS 486), annual, thousands, via FRED. BLS Monthly Labor Review (2025), "Describing the U.S. oil and gas extraction workforce with public data" (employment swing 2014–22 by industry).
- BLS OEWS occupational profiles for roustabouts (47-5071) and petroleum engineers (17-2171), May 2020, 2021, 2023, and May 2025 national figures; BLS Employment Projections base for petroleum engineers (19,600 in 2024).
- EIA, Today in Energy (July 2026), U.S. crude oil production record in 2025, and EIA analysis of rig and well activity and the WTI price, 2024 versus 2025. Rig count from Baker Hughes as reported by Engine, March 2026. Rigzone, October 12, 2026, on extraction employment (headline).
Every seat on the Oil & Gas Board carries a Cycle Exposure box for exactly this reason. The companion piece on the 7.4% number is Supports vs. Accounts For. Get the MoneyZoo LAB Report every Monday and instant access to The Side Door Playbook — one seat, one receipt, one move. Subscribe here.
