By Jeremy Deaton

Since the beginning, President Donald Trump promised that removing regulations on oil companies would drive employment. “We’re bringing back jobs big league,” he said in February.

But, after six months of regulatory rollback, Trump has done almost nothing that will create jobs on oil fields or offshore rigs. That’s because low oil prices, not environmental protections, are stunting job growth, and Trump’s push to nix federal regulations and expand drilling will only make oil cheaper.

Foreign producers have flooded the market, driving down the price of crude oil. Oil giants like Exxon have seen earnings drop off as a result. In an effort to cut costs and salvage profits, oil companies are laying off workers or automating operations, replacing workers with machines. Drilling rigs have gotten more efficient, allowing companies to pump the same volume of oil with half as much equipment and far fewer workers. Automation is creating a small number of high-tech jobs for skilled workers, but it’s eliminating the well-paid blue collar jobs Trump promised to deliver.

CREDIT: U.S. Energy Information Administration

The oil and gas extraction sector lost more than 140,000 jobs between 2014 and 2016, when the price of oil hit a slump. The industry lost three times as many jobs over that period than it did between 2008 and 2009, during the recession.

CREDIT: U.S. Energy Information Administration

“When the inputs to a business get cheaper, that causes the business to expand, increasing employment,” said Mark Jacobsen, professor of economics at UC San Diego. “From the perspective of a U.S. oil producer, input costs haven’t changed much, but the output they produce is [now] worth very little. This causes the business to shrink, decreasing employment.”


Even if the price of oil rebounds, it likely won’t do so permanently. Electric vehicles are getting cheaper every day, and sales numbers for EVs are growing by leaps and bounds. Over the next few years, this will likely stunt demand for gas, leading to an oversupply of oil and a further downturn in prices, according to analysis from Bloomberg. And the situation isn’t likely to change, considering the United Kingdom, France, and Norway have all passed laws banning the sale of fossil fuel-powered cars by 2040 or, in the case of Norway, 2025. Other countries are likely to follow suit.

Technology and economics, not environmental protections, are driving the loss of jobs. There is very little that this president — or any president — can do about it.

Those environmental protections, however, are key to warding off the punishing heat waves, powerful storms, and persistent drought associated with climate change. Trump, for example, has tried axing a rule that limits methane pollution from oil and gas drilling sites. The measure, which imposes marginal costs on energy firms, is vital to reining in emissions of this extremely potent greenhouse gas. A recent draft report from 13 federal agencies shows that a high-emissions scenario will result in as much as 10ºF of warming in the United States and up to 8 feet of sea level rise.

But Trump has turned a blind eye to the climate change crisis. Overall, his energy policies fall into two broad categories: those that ease restrictions on fossil fuel companies, like his decision to allow firms to lobby foreign governments in secret, and those that seek to open up federal lands and waters to drilling.


Trump’s proposed budget calls for opening the Arctic National Wildlife Refuge to drilling, for instance. He has already signed executive orders calling for federal agencies to lift restrictions on offshore drilling, approve the construction of the Dakota Access and Keystone XL pipelines, and review monument designations with an eye to opening federal lands to oil drilling.

“By increasing the amount of government land available for drilling, this could reduce the price producers pay for the land,” said Jacobsen. “However, the difficulty in the case of oil is that increases in supply will just continue to drive down the price of the product, making it a difficult proposition to help the sector.”

In other words, making it easier and cheaper to drill for oil will do nothing to increase prices and create jobs. While Trump appears to understand that more production will suppress prices, he fails to see that lower prices will hurt job prospects.

Oil would be $25 a barrel if our government would let us drill. Our country would be rich again–who needs OPEC. — Donald J. Trump (@realDonaldTrump) September 19, 2012