U.S. Oil Production Is Booming. Oil Jobs Are Not.

For years, as oil and gas companies increased production, they hired lots of workers, enriching communities across the United States. That is no longer true.

The country is pumping more oil than ever and near-record amounts of gas. But the companies that extract, transport and process these fossil fuels employ roughly 25 percent fewer workers than they did a decade earlier when they were churning out less fuel, according to a New York Times analysis of federal data.

Now, with some worried about a looming oversupply of oil, producers are tightening their belt, with spending across North America expected to fall 3 percent this year, according to Barclays. That raises the specter of further job losses, even as President-elect Donald J. Trump urges companies to “drill, baby, drill.”

Oil prices have risen in recent days after President Biden announced new sanctions on Russia’s oil industry, but it’s not clear how those restrictions may affect commodity prices and U.S. producers in the long run.

The thinning out of American oil and gas jobs is reminiscent of the long decline of the U.S. coal industry, where employment crested decades before production fell as mining companies extracted more rocks with fewer people.

Two decades into the shale boom, companies are drilling wells that extend deeper into the earth, unlocking more oil and natural gas. New technology is letting them oversee drilling, fracking and production from afar, with fewer people on-site. And larger companies are snapping up smaller players, shedding accountants, engineers and other workers as they go.

While the total number of jobs has increased from the bleakest days of the pandemic, far fewer people are working in the industry than they were before Covid.

Among the cost-cutting techniques being pursued by Exxon Mobil and Chevron: hiring engineers and geologists in India, where labor is cheaper, to support activities in the United States and elsewhere.

The decline in oil and gas work also reflects the continuing transition to cleaner forms of energy, even if that shift is happening more slowly than many analysts had anticipated a few years ago.

“You won’t see a lot of job growth in just the basic act of producing oil and natural gas,” Chris Wright, chief executive of the oil field services company Liberty Energy, said in an interview before Mr. Trump tapped him to lead the Energy Department.

The industry, Mr. Wright said, is “on a trend now of flat to maybe gradually declining employment.”

Mr. Trump will “protect our energy jobs” while lowering costs for consumers, said Karoline Leavitt, a spokeswoman for the president-elect’s transition team.

During the first half of the American fracking boom, oil and gas companies added workers at a much faster clip than other industries. The industry nearly doubled in size over 10 years, turbocharging the economies of places like North Dakota, home to the Bakken shale formation.

Then, in 2014, oil prices crashed. It took a couple of years, but U.S. production eventually bounced back, soaring to a record of nearly 13.5 million barrels a day last fall. Employment never fully recovered, though, entering an undulating decline punctuated by booms and busts, most recently during the pandemic, when oil prices briefly plunged below zero.

Matthew Waguespack was fracking a well in early 2020 when a representative for the oil company that had hired his team to do fieldwork walked into the crew’s mobile office in eastern New Mexico.

“Pump all your sand, pump all your chemicals, pack up,” Mr. Waguespack recalled the man telling the team. “And get out of here.”

It wasn’t long before Mr. Waguespack, an engineer for the oil field services company then known as Schlumberger, was out of work. Like more than 100,000 other oil and gas workers who had lost their jobs as fuel demand dried up that year, he found himself wondering: “What do I do next?”

While Mr. Waguespack searched for work, oil and gas companies slashed budgets and did whatever they could to survive. They drilled ever-bigger wells and installed sensors and other technology that enabled more remote work. Many turned to natural gas to power fracking equipment, rather than diesel, and found that it was cleaner and faster.

Highly indebted companies didn’t make it, with more than 100 producers and service firms seeking bankruptcy protection in 2020, according to the law firm Haynes Boone.

By late 2024, the number of drilling rigs operating in the United States had fallen roughly 28 percent in five years, federal data show. And still production climbed.

“We get three times as many wells from a rig today that we did in 2018 or 2019,” Bart Cahir, who leads Exxon’s shale division, said in an interview last year. “Per person, we’re producing a lot more.”

That the oil and gas industry has become more productive is good news for the economy, which benefits when people are able to do more with less, said Jesse Thompson, an economist with the Federal Reserve Bank of Dallas.

“But in the meantime,” he added, “there are firms and individuals and communities that can lose out.”

One consequence of the industry’s efficiency drive is that oil and gas companies, known for paying well, are no longer offering as much of a premium over other industries. Before the pandemic, average wages in oil and gas production were more than 60 percent higher than those in manufacturing, construction and other related industries, federal data show. By last fall, that premium had narrowed to little more than 30 percent.

Mr. Waguespack found his way back to the oil patch in 2021, more than a year after being laid off. But by then, the day rates and other incentives that had made his job in the Permian basin so lucrative had all but disappeared. Without them, Mr. Waguespack said, his annual pay shrank to around $105,000, from roughly $130,000 in 2019, in line with what he could make working in an office or a plant back home in Louisiana.

“I began looking for other jobs, trying to get away from the oil field,” Mr. Waguespack, 30, said.

With the post-Covid economy doing well and unemployment below 4 percent nationally for more than two years beginning in early 2022, he and workers like Cody Owlett, who spent a decade crisscrossing Pennsylvania pressure-washing equipment such as drilling rigs, had other options.

Mr. Owlett’s job paid well for where he lived near the northern edge of the state: about $35 an hour, with more than 60 hours of overtime some weeks. But all the time he spent on the road meant he missed holidays and rarely could pick his boys up from school.

“I was tired of missing everything with them,” Mr. Owlett, 34, said.

When he realized in 2023 that he could earn a similar income buying discounted merchandise and reselling it on eBay, Mr. Owlett quit the gas field.

Jobs like the one Mr. Owlett had held are among the most cyclical, rising and falling with oil and gas prices. Those service positions account for most of the work that has come back after the pandemic.

Refining — the process of turning crude oil into gasoline, diesel and other fuels — has experienced more sustained job losses. Even as oil demand is rising globally, many believe appetite for gasoline in the United States and elsewhere has already peaked, and companies are closing fuel-making facilities.

Other job losses have followed mergers and acquisitions. After acquiring a pipeline company, the Pittsburgh-based natural gas driller EQT said last fall that it was cutting its work force by 15 percent. In Texas, roughly 500 people lost their jobs as part of the oil producer ConocoPhillips’s recent acquisition of Marathon Oil, state records show.

At the same time, oil majors have been staffing up in countries where salaries are lower.

Five to 10 years ago, Western oil and gas companies turned to places like India’s tech hub of Bengaluru to fill roles in information technology, human resources and supply chain management, said Timothy Haskell, who leads EY’s people consulting practice for the energy industry in the United States. Today, they’re scooping up engineers and other technical professionals who make up the backbone of the industry.

“While the work force may be shrinking in the U.S., in some cases it’s very much growing in other parts of the world,” Mr. Haskell said.

Last year, Chevron said it was opening an engineering and technology outpost in India, a $1 billion undertaking that Chevron has described as being part of a broader cost-cutting effort.

“We’re going to change where and how we do some of our work,” Mike Wirth, Chevron’s chief executive, told Bloomberg in November. More than half of Chevron’s employees are based in the United States, and that ratio has been stable since at least 2014, a company spokesman said, describing the oil producer as “a proud American company.”

Exxon has had a growing presence in Bengaluru. The scope of the work that employees do there has expanded over time from smaller, more routine tasks to more important jobs. Engineers and geoscientists in the southern Indian city have worked on some of the company’s flagship projects, including those off the coast of Guyana and in the United States, three former employees said.

Exxon declined to comment on its Indian operations.

Mr. Waguespack eventually landed the job he was looking for in Louisiana. In his new engineering role, at an industrial gas supplier, he runs various projects like replacing aging equipment at facilities around the Gulf Coast.

He makes slightly more than he did during his second stint in the oil patch. And instead of commuting from Louisiana to West Texas for weeks at a time, he lives five minutes from the office.

“I do, to this day, still kind of wonder what could have happened if I would have stayed,” Mr. Waguespack said. “But I think I’ve got a good thing going on now.”

Ben Casselman contributed reporting.