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It Calls Itself the Energy Capital. Now It Faces 2 ‘Horrifying’ Crises. It Calls Itself the Energy Capital. Now It Faces 2 ‘Horrifying’ Crises.
(about 11 hours later)
HOUSTON — On the same day that the price for U.S. crude oil fell to about $30 below zero — a mind-bending concept and the first time oil prices had ever turned negative — Mayor Sylvester Turner of Houston, the self-proclaimed energy capital of the world, stood before reporters. His words were grim and muffled by the black mask covering his face.HOUSTON — On the same day that the price for U.S. crude oil fell to about $30 below zero — a mind-bending concept and the first time oil prices had ever turned negative — Mayor Sylvester Turner of Houston, the self-proclaimed energy capital of the world, stood before reporters. His words were grim and muffled by the black mask covering his face.
The mayor announced that city employees would soon be furloughed, but he declined to say how many. The Houston Zoo, he said, could expect to see funding deferred under what he called “the worst budget that the city will deal with in its history.”The mayor announced that city employees would soon be furloughed, but he declined to say how many. The Houston Zoo, he said, could expect to see funding deferred under what he called “the worst budget that the city will deal with in its history.”
Cities across the country are struggling under the economic shadow of the coronavirus. But few have to deal with a collapse in their fundamental industry at the same time.Cities across the country are struggling under the economic shadow of the coronavirus. But few have to deal with a collapse in their fundamental industry at the same time.
“We’ve probably seen within weeks the same amount of economic shock that used to occur in years,” said State Senator Paul Bettencourt, a Houston Republican whose district includes the Energy Corridor, a stretch of Interstate 10 on Houston’s west side that is home to Shell, ConocoPhillips and other oil and gas giants. “We’ve gone through this before. The problem is we didn’t do it in the middle of a pandemic.”“We’ve probably seen within weeks the same amount of economic shock that used to occur in years,” said State Senator Paul Bettencourt, a Houston Republican whose district includes the Energy Corridor, a stretch of Interstate 10 on Houston’s west side that is home to Shell, ConocoPhillips and other oil and gas giants. “We’ve gone through this before. The problem is we didn’t do it in the middle of a pandemic.”
Energy conferences that drew oil executives from around the world to Houston have been called off. Budget analysts expect a loss of more than $100 million in revenue for city government, with sales tax revenue alone expected to drop by 30 percent for the month of April.Energy conferences that drew oil executives from around the world to Houston have been called off. Budget analysts expect a loss of more than $100 million in revenue for city government, with sales tax revenue alone expected to drop by 30 percent for the month of April.
Thousands of energy workers, some of whom only lately moved to the region to take advantage of the recent prosperity, have been laid off. Many of them were told the bad news during painful Zoom sessions from home.Thousands of energy workers, some of whom only lately moved to the region to take advantage of the recent prosperity, have been laid off. Many of them were told the bad news during painful Zoom sessions from home.
Warning letters from energy companies have been flooding the Texas Workforce Commission about layoffs and furloughs: 3,500 at Halliburton, 223 at Tenaris, 184 at Baker Hughes, 102 at Diamond Offshore Drilling, 95 at Energy Transfer.Warning letters from energy companies have been flooding the Texas Workforce Commission about layoffs and furloughs: 3,500 at Halliburton, 223 at Tenaris, 184 at Baker Hughes, 102 at Diamond Offshore Drilling, 95 at Energy Transfer.
“This feels like the early ’80s when we were in the oil price crash, but it’s the one-two that’s horrifying — the one-two punch with Covid and the oil prices,” said Annise Parker, who served as mayor of Houston from 2010 to 2016, referring to Covid-19, the disease caused by the coronavirus. “It’s going to be devastating.”“This feels like the early ’80s when we were in the oil price crash, but it’s the one-two that’s horrifying — the one-two punch with Covid and the oil prices,” said Annise Parker, who served as mayor of Houston from 2010 to 2016, referring to Covid-19, the disease caused by the coronavirus. “It’s going to be devastating.”
The Houston area by some estimates may lose 200,000 to 300,000 jobs — a blow worse than the Great Recession of 2008 and 2009.The Houston area by some estimates may lose 200,000 to 300,000 jobs — a blow worse than the Great Recession of 2008 and 2009.
Bob Dunston, 60, who was an engineer supervisor, had worked for 18 years at Weatherford International, one of the world’s largest oil field services companies. On April 9, he found himself on a Skype call with his boss’s boss and a representative from human resources.Bob Dunston, 60, who was an engineer supervisor, had worked for 18 years at Weatherford International, one of the world’s largest oil field services companies. On April 9, he found himself on a Skype call with his boss’s boss and a representative from human resources.
“He said, ‘Hey, you’ve been a great employee. You’re one of my best employees, and this and that, but with oil the way it is right now, at 20 bucks a barrel, we’re just having to reduce the division head count,’” said Mr. Dunston, who had been working from home during the local coronavirus lockdown.“He said, ‘Hey, you’ve been a great employee. You’re one of my best employees, and this and that, but with oil the way it is right now, at 20 bucks a barrel, we’re just having to reduce the division head count,’” said Mr. Dunston, who had been working from home during the local coronavirus lockdown.
Mr. Dunston is still trying to recover from Hurricane Harvey in 2017, which pushed 15 feet of floodwaters into his two-story townhome. In a new home, but without a job, he is unsure what is next.Mr. Dunston is still trying to recover from Hurricane Harvey in 2017, which pushed 15 feet of floodwaters into his two-story townhome. In a new home, but without a job, he is unsure what is next.
“My game plan may be just retire,” Mr. Dunston said. “I saved money for a reason.”“My game plan may be just retire,” Mr. Dunston said. “I saved money for a reason.”
Houston is no longer the oil town it was in past decades. Its economy has diversified, as has its population. More so than cowboy boots, scrubs are its unofficial uniform; the Texas Medical Center is the largest medical complex in the world, with more than 100,000 health care workers.Houston is no longer the oil town it was in past decades. Its economy has diversified, as has its population. More so than cowboy boots, scrubs are its unofficial uniform; the Texas Medical Center is the largest medical complex in the world, with more than 100,000 health care workers.
But much of Houston’s energy still comes from energy.But much of Houston’s energy still comes from energy.
Business owners of all types make it a daily habit to check the price of West Texas intermediate, the benchmark for U.S. crude oil prices. The Houston Marathon is officially known as the Chevron Houston Marathon. One of the city’s most respected disaster-recovery leaders, whom the mayor recently named as his Covid-19 economic recovery czar, is Marvin E. Odum, the former president of Shell Oil.Business owners of all types make it a daily habit to check the price of West Texas intermediate, the benchmark for U.S. crude oil prices. The Houston Marathon is officially known as the Chevron Houston Marathon. One of the city’s most respected disaster-recovery leaders, whom the mayor recently named as his Covid-19 economic recovery czar, is Marvin E. Odum, the former president of Shell Oil.
Houston’s cultural institutions and nonprofit groups rely on philanthropy from the oil and gas industry. The city has had world-class opera, theater, ballet, symphony and art in large part because it had world-class oil money.Houston’s cultural institutions and nonprofit groups rely on philanthropy from the oil and gas industry. The city has had world-class opera, theater, ballet, symphony and art in large part because it had world-class oil money.
Now, all of that is under threat.Now, all of that is under threat.
“The oil and gas industry employs about a quarter of a million people in Houston, so we’re looking at losing at least 10 percent of those jobs, if not more,” said Patrick Jankowski, senior vice president of research at the Greater Houston Partnership, a regional business association. “Right now, I think people are probably more worried about their job than they are about Covid-19.”“The oil and gas industry employs about a quarter of a million people in Houston, so we’re looking at losing at least 10 percent of those jobs, if not more,” said Patrick Jankowski, senior vice president of research at the Greater Houston Partnership, a regional business association. “Right now, I think people are probably more worried about their job than they are about Covid-19.”
More than 240,000 Houstonians filed unemployment claims from March 15 to April 11, a number certain to rise as the backlog is processed.More than 240,000 Houstonians filed unemployment claims from March 15 to April 11, a number certain to rise as the backlog is processed.
“We may be heading toward that recession,” Mr. Jankowsi said. “Intellectually, I can see that we’re there. Emotionally, I have a hard time accepting it. Once you start saying we’re in a recession, it conjures up so many images and so much pain.”“We may be heading toward that recession,” Mr. Jankowsi said. “Intellectually, I can see that we’re there. Emotionally, I have a hard time accepting it. Once you start saying we’re in a recession, it conjures up so many images and so much pain.”
As the damage to the economy widens not just in Houston but throughout Texas, Gov. Greg Abbott on Monday announced a phased-in reopening of businesses that will allow retail stores, restaurants, movie theaters and malls to open their doors on Friday, with limited capacity. The stay-at-home order that took effect earlier this month is still set to expire on April 30. But the gradual end of coronavirus restrictions is not expected to do much to reinvigorate the oil and gas sector — not as long as prices remain so low.As the damage to the economy widens not just in Houston but throughout Texas, Gov. Greg Abbott on Monday announced a phased-in reopening of businesses that will allow retail stores, restaurants, movie theaters and malls to open their doors on Friday, with limited capacity. The stay-at-home order that took effect earlier this month is still set to expire on April 30. But the gradual end of coronavirus restrictions is not expected to do much to reinvigorate the oil and gas sector — not as long as prices remain so low.
Houston has been through oil booms and oil busts before. The oil downturn of the 1980s was the worst ever, costing the region one in seven jobs. But now even the Petroleum Club of Houston is closed, along with bars, malls and many churches.Houston has been through oil booms and oil busts before. The oil downturn of the 1980s was the worst ever, costing the region one in seven jobs. But now even the Petroleum Club of Houston is closed, along with bars, malls and many churches.
One man who was laid off from his job as a manager for an oil field services company said he felt as though he was “forced into a holding pattern, where you’re sitting at home, you’re looking for stuff on the internet, talking to people on the phone, but you’re not active.”One man who was laid off from his job as a manager for an oil field services company said he felt as though he was “forced into a holding pattern, where you’re sitting at home, you’re looking for stuff on the internet, talking to people on the phone, but you’re not active.”
Another laid-off energy employee, who worked as a geologist, said social-distancing made it harder to build relationships that would open doors to a new job. “It’s really challenging when you can’t go shake hands with somebody or have a coffee with them,” he said.Another laid-off energy employee, who worked as a geologist, said social-distancing made it harder to build relationships that would open doors to a new job. “It’s really challenging when you can’t go shake hands with somebody or have a coffee with them,” he said.
The two men did not want their names published, for fear it could harm their ability to find another job.The two men did not want their names published, for fear it could harm their ability to find another job.
Oil towns across the country are looking at similar double economic blows.Oil towns across the country are looking at similar double economic blows.
In the oil-rich region around Kern County in California, which produces 70 percent of the oil in the state, some larger employers have managed to get by with reduced hours for employees, but smaller producers and service companies around the city of Bakersfield have already begun layoffs. The Marathon Petroleum Corporation has temporarily shuttered a refinery east of San Francisco that employs more than 700 people.In the oil-rich region around Kern County in California, which produces 70 percent of the oil in the state, some larger employers have managed to get by with reduced hours for employees, but smaller producers and service companies around the city of Bakersfield have already begun layoffs. The Marathon Petroleum Corporation has temporarily shuttered a refinery east of San Francisco that employs more than 700 people.
States like Alaska, Louisiana, North Dakota, Oklahoma and Wyoming, among others, also face the prospect of budget cuts and layoffs.States like Alaska, Louisiana, North Dakota, Oklahoma and Wyoming, among others, also face the prospect of budget cuts and layoffs.
“You can’t produce it, you can’t refine it and you can’t sell it,” said Catherine Reheis-Boyd, president of the Western States Petroleum Association, the oil industry trade group representing Arizona, California, Nevada, Oregon and Washington. “That ain’t a good situation to be in.”
Updated June 22, 2020Updated June 22, 2020
A commentary published this month on the website of the British Journal of Sports Medicine points out that covering your face during exercise “comes with issues of potential breathing restriction and discomfort” and requires “balancing benefits versus possible adverse events.” Masks do alter exercise, says Cedric X. Bryant, the president and chief science officer of the American Council on Exercise, a nonprofit organization that funds exercise research and certifies fitness professionals. “In my personal experience,” he says, “heart rates are higher at the same relative intensity when you wear a mask.” Some people also could experience lightheadedness during familiar workouts while masked, says Len Kravitz, a professor of exercise science at the University of New Mexico.A commentary published this month on the website of the British Journal of Sports Medicine points out that covering your face during exercise “comes with issues of potential breathing restriction and discomfort” and requires “balancing benefits versus possible adverse events.” Masks do alter exercise, says Cedric X. Bryant, the president and chief science officer of the American Council on Exercise, a nonprofit organization that funds exercise research and certifies fitness professionals. “In my personal experience,” he says, “heart rates are higher at the same relative intensity when you wear a mask.” Some people also could experience lightheadedness during familiar workouts while masked, says Len Kravitz, a professor of exercise science at the University of New Mexico.
The steroid, dexamethasone, is the first treatment shown to reduce mortality in severely ill patients, according to scientists in Britain. The drug appears to reduce inflammation caused by the immune system, protecting the tissues. In the study, dexamethasone reduced deaths of patients on ventilators by one-third, and deaths of patients on oxygen by one-fifth.The steroid, dexamethasone, is the first treatment shown to reduce mortality in severely ill patients, according to scientists in Britain. The drug appears to reduce inflammation caused by the immune system, protecting the tissues. In the study, dexamethasone reduced deaths of patients on ventilators by one-third, and deaths of patients on oxygen by one-fifth.
The coronavirus emergency relief package gives many American workers paid leave if they need to take time off because of the virus. It gives qualified workers two weeks of paid sick leave if they are ill, quarantined or seeking diagnosis or preventive care for coronavirus, or if they are caring for sick family members. It gives 12 weeks of paid leave to people caring for children whose schools are closed or whose child care provider is unavailable because of the coronavirus. It is the first time the United States has had widespread federally mandated paid leave, and includes people who don’t typically get such benefits, like part-time and gig economy workers. But the measure excludes at least half of private-sector workers, including those at the country’s largest employers, and gives small employers significant leeway to deny leave.The coronavirus emergency relief package gives many American workers paid leave if they need to take time off because of the virus. It gives qualified workers two weeks of paid sick leave if they are ill, quarantined or seeking diagnosis or preventive care for coronavirus, or if they are caring for sick family members. It gives 12 weeks of paid leave to people caring for children whose schools are closed or whose child care provider is unavailable because of the coronavirus. It is the first time the United States has had widespread federally mandated paid leave, and includes people who don’t typically get such benefits, like part-time and gig economy workers. But the measure excludes at least half of private-sector workers, including those at the country’s largest employers, and gives small employers significant leeway to deny leave.
So far, the evidence seems to show it does. A widely cited paper published in April suggests that people are most infectious about two days before the onset of coronavirus symptoms and estimated that 44 percent of new infections were a result of transmission from people who were not yet showing symptoms. Recently, a top expert at the World Health Organization stated that transmission of the coronavirus by people who did not have symptoms was “very rare,” but she later walked back that statement.So far, the evidence seems to show it does. A widely cited paper published in April suggests that people are most infectious about two days before the onset of coronavirus symptoms and estimated that 44 percent of new infections were a result of transmission from people who were not yet showing symptoms. Recently, a top expert at the World Health Organization stated that transmission of the coronavirus by people who did not have symptoms was “very rare,” but she later walked back that statement.
Touching contaminated objects and then infecting ourselves with the germs is not typically how the virus spreads. But it can happen. A number of studies of flu, rhinovirus, coronavirus and other microbes have shown that respiratory illnesses, including the new coronavirus, can spread by touching contaminated surfaces, particularly in places like day care centers, offices and hospitals. But a long chain of events has to happen for the disease to spread that way. The best way to protect yourself from coronavirus — whether it’s surface transmission or close human contact — is still social distancing, washing your hands, not touching your face and wearing masks.Touching contaminated objects and then infecting ourselves with the germs is not typically how the virus spreads. But it can happen. A number of studies of flu, rhinovirus, coronavirus and other microbes have shown that respiratory illnesses, including the new coronavirus, can spread by touching contaminated surfaces, particularly in places like day care centers, offices and hospitals. But a long chain of events has to happen for the disease to spread that way. The best way to protect yourself from coronavirus — whether it’s surface transmission or close human contact — is still social distancing, washing your hands, not touching your face and wearing masks.
A study by European scientists is the first to document a strong statistical link between genetic variations and Covid-19, the illness caused by the coronavirus. Having Type A blood was linked to a 50 percent increase in the likelihood that a patient would need to get oxygen or to go on a ventilator, according to the new study.A study by European scientists is the first to document a strong statistical link between genetic variations and Covid-19, the illness caused by the coronavirus. Having Type A blood was linked to a 50 percent increase in the likelihood that a patient would need to get oxygen or to go on a ventilator, according to the new study.
The unemployment rate fell to 13.3 percent in May, the Labor Department said on June 5, an unexpected improvement in the nation’s job market as hiring rebounded faster than economists expected. Economists had forecast the unemployment rate to increase to as much as 20 percent, after it hit 14.7 percent in April, which was the highest since the government began keeping official statistics after World War II. But the unemployment rate dipped instead, with employers adding 2.5 million jobs, after more than 20 million jobs were lost in April.The unemployment rate fell to 13.3 percent in May, the Labor Department said on June 5, an unexpected improvement in the nation’s job market as hiring rebounded faster than economists expected. Economists had forecast the unemployment rate to increase to as much as 20 percent, after it hit 14.7 percent in April, which was the highest since the government began keeping official statistics after World War II. But the unemployment rate dipped instead, with employers adding 2.5 million jobs, after more than 20 million jobs were lost in April.
States are reopening bit by bit. This means that more public spaces are available for use and more and more businesses are being allowed to open again. The federal government is largely leaving the decision up to states, and some state leaders are leaving the decision up to local authorities. Even if you aren’t being told to stay at home, it’s still a good idea to limit trips outside and your interaction with other people.States are reopening bit by bit. This means that more public spaces are available for use and more and more businesses are being allowed to open again. The federal government is largely leaving the decision up to states, and some state leaders are leaving the decision up to local authorities. Even if you aren’t being told to stay at home, it’s still a good idea to limit trips outside and your interaction with other people.
Common symptoms include fever, a dry cough, fatigue and difficulty breathing or shortness of breath. Some of these symptoms overlap with those of the flu, making detection difficult, but runny noses and stuffy sinuses are less common. The C.D.C. has also added chills, muscle pain, sore throat, headache and a new loss of the sense of taste or smell as symptoms to look out for. Most people fall ill five to seven days after exposure, but symptoms may appear in as few as two days or as many as 14 days.Common symptoms include fever, a dry cough, fatigue and difficulty breathing or shortness of breath. Some of these symptoms overlap with those of the flu, making detection difficult, but runny noses and stuffy sinuses are less common. The C.D.C. has also added chills, muscle pain, sore throat, headache and a new loss of the sense of taste or smell as symptoms to look out for. Most people fall ill five to seven days after exposure, but symptoms may appear in as few as two days or as many as 14 days.
If air travel is unavoidable, there are some steps you can take to protect yourself. Most important: Wash your hands often, and stop touching your face. If possible, choose a window seat. A study from Emory University found that during flu season, the safest place to sit on a plane is by a window, as people sitting in window seats had less contact with potentially sick people. Disinfect hard surfaces. When you get to your seat and your hands are clean, use disinfecting wipes to clean the hard surfaces at your seat like the head and arm rest, the seatbelt buckle, the remote, screen, seat back pocket and the tray table. If the seat is hard and nonporous or leather or pleather, you can wipe that down, too. (Using wipes on upholstered seats could lead to a wet seat and spreading of germs rather than killing them.)If air travel is unavoidable, there are some steps you can take to protect yourself. Most important: Wash your hands often, and stop touching your face. If possible, choose a window seat. A study from Emory University found that during flu season, the safest place to sit on a plane is by a window, as people sitting in window seats had less contact with potentially sick people. Disinfect hard surfaces. When you get to your seat and your hands are clean, use disinfecting wipes to clean the hard surfaces at your seat like the head and arm rest, the seatbelt buckle, the remote, screen, seat back pocket and the tray table. If the seat is hard and nonporous or leather or pleather, you can wipe that down, too. (Using wipes on upholstered seats could lead to a wet seat and spreading of germs rather than killing them.)
If you’ve been exposed to the coronavirus or think you have, and have a fever or symptoms like a cough or difficulty breathing, call a doctor. They should give you advice on whether you should be tested, how to get tested, and how to seek medical treatment without potentially infecting or exposing others.If you’ve been exposed to the coronavirus or think you have, and have a fever or symptoms like a cough or difficulty breathing, call a doctor. They should give you advice on whether you should be tested, how to get tested, and how to seek medical treatment without potentially infecting or exposing others.
If you’re sick and you think you’ve been exposed to the new coronavirus, the C.D.C. recommends that you call your healthcare provider and explain your symptoms and fears. They will decide if you need to be tested. Keep in mind that there’s a chance — because of a lack of testing kits or because you’re asymptomatic, for instance — you won’t be able to get tested.If you’re sick and you think you’ve been exposed to the new coronavirus, the C.D.C. recommends that you call your healthcare provider and explain your symptoms and fears. They will decide if you need to be tested. Keep in mind that there’s a chance — because of a lack of testing kits or because you’re asymptomatic, for instance — you won’t be able to get tested.
“You can’t produce it, you can’t refine it and you can’t sell it,” said Catherine Reheis-Boyd, president of the Western States Petroleum Association, the oil industry trade group representing Arizona, California, Nevada, Oregon and Washington. “That ain’t a good situation to be in.”
In Houston, no one has become more intimately familiar with the details of the oil market woes than Chris B. Brown, the city’s chief financial officer and a fourth-generation Houstonian.In Houston, no one has become more intimately familiar with the details of the oil market woes than Chris B. Brown, the city’s chief financial officer and a fourth-generation Houstonian.
Rare, severe and unforeseen events are known as “black swans,” a theory that comes from a 2007 book by Nassim Nicholas Taleb, “The Black Swan: The Impact of the Highly Improbable.” Mr. Brown has taken to calling Houston’s situation a “double black swan.”Rare, severe and unforeseen events are known as “black swans,” a theory that comes from a 2007 book by Nassim Nicholas Taleb, “The Black Swan: The Impact of the Highly Improbable.” Mr. Brown has taken to calling Houston’s situation a “double black swan.”
About 40 percent of the city’s economy is tied to the price of oil, Mr. Brown said. That means that when other cities are recovering from the economic damage of the coronavirus shutdown, Houston will still be lagging.About 40 percent of the city’s economy is tied to the price of oil, Mr. Brown said. That means that when other cities are recovering from the economic damage of the coronavirus shutdown, Houston will still be lagging.
“We are going to be hit disproportionately hard and probably will have a longer recovery period,” he said, “because once the world gets back on track from coronavirus, it’s going to take probably several years before the imbalance in the oil markets gets to a point where all oil prices come back substantially.”“We are going to be hit disproportionately hard and probably will have a longer recovery period,” he said, “because once the world gets back on track from coronavirus, it’s going to take probably several years before the imbalance in the oil markets gets to a point where all oil prices come back substantially.”
Across the city, institutions are already dealing with the fallout.Across the city, institutions are already dealing with the fallout.
The Heritage Society, which preserves historic buildings in a downtown park, expects a swift downturn in contributions from the energy sector, which typically make up about one-fifth of the nonprofit’s budget.The Heritage Society, which preserves historic buildings in a downtown park, expects a swift downturn in contributions from the energy sector, which typically make up about one-fifth of the nonprofit’s budget.
“It directly affects everything we do, and I feel like the impact is just going to continue throughout the summer,” said Alison Ayres Bell, the Heritage Society’s executive director. “The trickle-down affects everyone.”“It directly affects everything we do, and I feel like the impact is just going to continue throughout the summer,” said Alison Ayres Bell, the Heritage Society’s executive director. “The trickle-down affects everyone.”
This month, on the same day Mr. Dunston was laid off, the Houston Museum of Natural Science announced that it would furlough 337 employees — 70 percent of its staff — and that the pay of the remaining 144 workers would be cut by at least 15 percent. Joel A. Bartsch, the museum’s president, said the slump in oil prices would hurt donations and keep employees furloughed longer, and it would also mean that fewer employees would ultimately be able to return to work.This month, on the same day Mr. Dunston was laid off, the Houston Museum of Natural Science announced that it would furlough 337 employees — 70 percent of its staff — and that the pay of the remaining 144 workers would be cut by at least 15 percent. Joel A. Bartsch, the museum’s president, said the slump in oil prices would hurt donations and keep employees furloughed longer, and it would also mean that fewer employees would ultimately be able to return to work.
Mr. Bartsch compared the city’s present struggle to “how Detroit was affected by the car companies and their financial issues.”Mr. Bartsch compared the city’s present struggle to “how Detroit was affected by the car companies and their financial issues.”
ARC Specialties, a company with 46 employees that produces robotic machinery, relies on energy industry clients so much that its headquarters are in the Energy Corridor. The oil and gas sector would annually account for about 30 percent of ARC Specialties’ business, or about $10 million. But no more.ARC Specialties, a company with 46 employees that produces robotic machinery, relies on energy industry clients so much that its headquarters are in the Energy Corridor. The oil and gas sector would annually account for about 30 percent of ARC Specialties’ business, or about $10 million. But no more.
“I’m pretty much going to have to cross that industry off my list for the next year or two,” said the company’s president, Dan Allford, 61.“I’m pretty much going to have to cross that industry off my list for the next year or two,” said the company’s president, Dan Allford, 61.
As the price of oil dropped and business slowed, Mr. Allford asked his employees to volunteer for furloughs. But they instead presented him with an option that would avoid temporary layoffs: a four-day workweek.As the price of oil dropped and business slowed, Mr. Allford asked his employees to volunteer for furloughs. But they instead presented him with an option that would avoid temporary layoffs: a four-day workweek.
He agreed.He agreed.
“They took the high road and I’m proud of them,” Mr. Allford said.“They took the high road and I’m proud of them,” Mr. Allford said.
Manny Fernandez reported from Houston, and David Montgomery from Austin, Texas. Shawn Hubler contributed reporting from Sacramento.Manny Fernandez reported from Houston, and David Montgomery from Austin, Texas. Shawn Hubler contributed reporting from Sacramento.