BUSINESS

Oilsands Construction Jobs To Shrink By 84%, Industry Report Predicts

02/18/2016 12:00 EST

The need for construction workers in the oilsands will practically disappear over the next four years, says a new report from an industry group — but the report hints the real employment problems in the oil patch could come after that, if oil prices don't recover.

The latest outlook from PetroLMI predicts that demand for construction workers will drop by 84 per cent between now and 2020, as new projects dry up due to low oil prices.

Some 10,305 construction jobs will disappear, the report predicts. But production will continue to grow at existing oilsands operations, and the industry will need 9,870 new workers in operations and maintenance by 2020.

In all, direct construction, maintenance and operations jobs in the oilsands will fall by 1 per cent between now and 2020, the report predicts.

oilsands jobs

“Overall workforce requirements for the oil and gas industry has been severely impacted by a reduction in investment,” PetroLMI vice-president of communications Carol Howes said in a statement.

“However, substantial capital has already been invested in large-scale oil sands projects so hiring is expected to continue to 2020.”

It’s what happens after 2020 that “remains to be seen,” Howes says. The report makes no estimates past that year, but notes that “the lack of oil sands capital investment to 2020 is likely to have an impact on production and operations employment growth after 2020.”

It’s estimated that oil prices have to be above the US$70-US$80 range before new oilsands projects make economic sense. Few projections these days see oil prices returning to those levels before 2020.

“As the industry works towards returning to profitability, it is expected that companies will streamline processes and invest in technologies to further improve operational efficiencies,” said Cameron MacGillivray, president and CEO of Enform. “Companies will need to continue to attract, retain and develop a highly skilled workforce in order to maintain any productivity gains.”

But those productivity gains could also put downward pressure on employment in the oil patch. Suncor last year began using driverless trucks at its oilsands mining operations, putting drivers out of work.

Automation presents a “conundrum” for the oilsands, Alberta Oil Magazine argued last year. While it could help the industry lower costs, it could also “make the already challenging task of selling the public on the industry’s virtues even more difficult.”