- Associated Press - Thursday, September 3, 2015

ANCHORAGE, Alaska (AP) - In wake of the announcement by energy company ConocoPhillips that it may cut about 120 jobs in Alaska, a state economist said the damage could have been worse.

Alaska Department of Labor and Workforce Development economist Neal Fried told the Alaska Dispatch News Wednesday (https://bit.ly/1LMWHU8) that he would not have been shocked if the number of layoffs announced was higher.

Alaska oil prices have dropped more than $28 per barrel over the last year, cutting into revenue for energy giants like ConocoPhillips.

In addition to eliminating about 10 percent of its workforce in Alaska, the company plans to cut more than 500 jobs in Houston, where it is based, and 400 jobs from its operations in the Canadian oil sands project in Alberta. Hundreds of more jobs are at risk in ConocoPhillips’ international operations.

Fried said beyond the actually energy employees that will lose their earnings, many contractors who work with ConocoPhillips for its repair and construction work in the oil fields may also be cut.

“As we have always said, these are the highest-paying jobs in our economy,” Fried said. “These jobs are significantly bigger multipliers than any other industry.”

Gov. Bill Walker said he wants to ensure that ConocoPhillips considers cutting positions held by out-of-state workers before laying off Alaskans.

“I am planning on having conversations that involve the industry as a whole to address the ripple effects that will be caused by this decision,” he said Wednesday.

Despite the potential impact, Fried said Alaska has weathered dips in oil prices and job cuts before.

“For example, in the 1990s, Arco (which later sold its Alaska assets to BP) cut 750 jobs — BP cut 400 during the early ‘90s, when we had that long period of sub-$20 oil,” Fried said.

In terms of long-term effects, Fried said oil prices will decide how deeply the recent job losses affect the state.

“The big question is how low will oil prices go and how long will they last?” Fried said.


Information from: Alaska Dispatch News, https://www.adn.com

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