Midland or Bust: Texas Shale Oil Boom Upends Regional Labor Market

Midland or Bust: Texas Shale Oil Boom Upends Regional Labor Market

LinkedIn’s latest Workforce Report for the US spotlights a phenomenon that’s shaking up the labor market in and around Texas, the nerve center of the American oil industry, where hiring has spiked in tandem with oil prices. Energy industry hiring rose 5.2 percent in the year to May 2018, compared to an average of 4.5 percent across all industries nationwide, LinkedIn found. Job growth has closely tracked the price of oil, with a dip in 2015-2016 followed by a boom as prices have risen steadily over the past two years. Hiring in Houston, the energy industry’s home base, grew 12.4 percent year-over-year, contributing to a reduction in the surplus of petroleum engineering, energy, and geology skills.

The energy industry is particularly sensitive to boom-bust cycles, and, so are cities like Odessa and Midland in west Texas, where the local economy is dominated by a single industry (in this case, oil), the report notes. In the current boom cycle, the migration of workers to the Odessa-Midland area is further tightening labor markets in Houston and other Texas cities:

With oil prices on the rise, talent inflows to this oil boom-town have picked up, particularly from the three largest Texas cities—Houston, Dallas, and Austin. Net movements to Odessa-Midland from these cities have grown significantly since September 2017, to 0.34 per 10,000 from Dallas (750%), 1.05 per 10,000 from Houston (44%), and 1.03 from Austin (255%). This impact can also be felt in the housing market—a recent report found that Odessa-Midland had the highest national rent increase in 2017, up 35.7% year-over-year.

Driving this boom is the rapid expansion of shale oil extraction in the Permian Basin, west Texas’s oil and natural gas producing region. High oil prices combined with advances in extraction technology have made shale extraction increasingly profitable, meaning oil companies have the incentive and the resources to lure talent with high pay. That’s great news for anyone working on an oil rig, but ancillary workers like truck drivers are also seeing huge signing bonuses and pay hikes, the Wall Street Journal reports, with some truckers in the Permian Basin earning over $100,000 a year, double the national average for long-haul truckers.

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ExxonMobil Shareholders Vote for Proxy Access

ExxonMobil Shareholders Vote for Proxy Access

At a time when investors are taking on an increasingly active, sometimes activist, role in making decisions about leadership at large organizations, shareholders at ExxonMobil approved a resolution this week that would enable those with at least 3 percent of outstanding shares to directly nominate candidates to the oil and gas company’s board of directors. Jena McGregor at the Washington Post explains what went down at Wednesday’s shareholder meeting, and what it portends:

During the meeting, a representative of three New York City municipal employees’ pension funds said that ExxonMobil’s board was the least diverse of the six biggest international oil and gas companies and that it ran the danger of “group think.” Shareholders agreed, with nearly 62 percent of the shares voted supporting the measure. In a filing, the company defended its current method of choosing board members, citing high vote tallies for those directors and saying the system would “undermine a business model that has long served the interest of shareholders well.”

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