Labour Outlook

Released: May, 2021

Labour Market Outlook

The oil and gas industry of 2021 has changed compared to 12 months ago. The combined events of the past year — demand shock from the COVID-19 global pandemic and an oversupplied oil market — led Canadian companies across all oil and gas sub-sectors to take swift action to adjust their strategies. This had a significant impact on the industry and its workforce.

The following reviews the impact of those events and the associated forecast on employment and hiring through to 2023. The scope of PetroLMI’s analysis is direct employment (those jobs in companies directly linked to finding, extracting and producing oil and gas, such as geologists and drillers) across the exploration and production (E&P), oil sands, oil and gas services and pipelines sub-sectors. To forecast employment, PetroLMI uses a modeling system developed in 2006 which is refined regularly through consultation with industry, labour market economists and workforce planning analysts. For information on the spending and production forecast used, please see Figure 1, Total Industry Employment and Employment Driver Forecast in the Labour Market Outlook 2021 to 2023: Canada’s Oil and Gas Industry summary report.


Oil and Gas Employment

A modest recovery scenario is forecasted for Canada’s oil and gas industry through to 2023. While PetroLMI is projecting slight increases in capital spending in 2021, employment will not begin recovering until 2022.

The industry is projected to add 7,840 jobs by 2023 due to industry activity, an increase of 5%. By 2023, at 175,850 jobs, industry’s direct employment surpasses 2020 levels but falls short of its 2019 employment level of 188,760.

Companies are expected to focus their capital spending on profitability enhancements over production gains as a path to competitiveness through:

  • Optimization and efficiency improvements to existing operations using digitization and technology
  • Economies of scale/consolidation
  • An even greater focus on environmental, social and governance (ESG)

Demand for natural gas is anticipated to recover before oil, as companies focus on higher value liquids-rich natural gas to provide feedstock for the petrochemical sector, liquid petroleum gas exports and liquefied natural gas (LNG).

Oil and natural gas well site reclamation and closure work will also drive spending and increased activity, and is expected to contribute to a tighter market for labour in those associated occupations.

For more information on key areas impacting the industry’s hiring, see Labour Market Outlook Spotlights.


Net Hiring Requirements

Canada’s oil and gas industry is expected to experience net hiring requirements of 19,820 jobs over the three-year forecast period: 7,840 due to industry activity and 11,980 due to age-related attrition. Vacancies due to age-related attrition may not boost overall employment levels within the industry but some hiring activity may occur as companies backfill positions.

Company representatives indicate retirements are being monitored and despite lower retirement rates in recent years, there is a risk of losing experienced workers. Some companies are implementing programs to transfer knowledge across their workforces. If there is hiring, not all retiring workers will be replaced by the same occupation; companies may choose to fill a gap instead and hire someone with different skills.


Labour Market Outlook

Here you can take a more detailed look by sub-sectors, regions and occupations. Navigate the dashboard below to gather the specific insights that matter to you.

Exploration and production (E&P): Activity for the conventional and unconventional oil and gas reserves, excluding oil sands.

Oil sands: The extraction and upgrading of bitumen.

Oil and gas services: Contracted exploration, extraction and production services to the oil sands and non-oil sands E&P sub-sectors.

Pipelines: Responsible for mainline transmission for transporting daily crude oil and natural gas production.

A = Actual
E = Estimated
F = Forecast

Released: May, 2021

Notes + Sources

The labour demand projections (i.e., activity demand, replacement demand and net hiring requirements) have been produced using PetroLMI's modelling system for the upstream and midstream oil and gas industry. The system projects labour demand by sector and by industry total for 67 occupations which are mapped to the National Occupational Classification (NOC) 2016. An “other occupations” category is used to capture any residual occupations and ensure total petroleum industry workforce is accounted for.

Employment is projected from baseline employment numbers derived from Statistics Canada and/or direct industry surveys, and then uses employment drivers to identify the required workforce levels to support the level of industry activity (i.e., spending and/or production) in a given year. The model does this by sub-sector and occupations with some adjustments for labour productivity and other factors.

Totals may not add up due to rounding.

Industry sectors such as the downstream sector, construction, manufacturing, LNG construction and operations, truck transportation as well as professional services are considered out of scope for this outlook.

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