Pennsylvania’s oil and gas industry shed almost a third of its workforce in the first quarter of this year.

According to Department of Labor and Industry data seen by State Impact, jobs in Pennsylvania’s oil and gas industry fell to 20,524 in the first quarter of 2016 compared to 30,313 jobs a year ago.

The figures are not seasonally adjusted and account for jobs in production, drilling, support activities and pipelines.

The headcount dip is likely tied to low natural gas and oil prices that have prompted companies to defer projects and reduce expenditures.”If there is a turnaround in the price levels, or a change in demand for natural gas, it is possible these trends could reverse,” Pennsylvania Department of Labor economist James Martini told State Impact.

Pennsylvania is home to a large portion of Marcellus shale play.

According to Baker Hughes, the Marcellus Basin lost one rig last week, pulling the area’s rig count down to 34 compared to 43 rigs a year ago.

Despite the year-over-year rig count decline, the U.S. Energy Information Administration (EIA) expects natural gas production in the region to continue growing.

The EIA expects natural gas production in the Marcellus region to climb from 18.17 billion cubic feet per day in November to 18.30 billion cubic feet per day in December.

Marcellus natural gas reserves rose to 84.5 trillion cubic feet in 2014 compared to 62.4 trillion cubic feet the prior year.

The EIA said earlier this month that it expects U.S. natural gas production to start rising in November thanks to a bump in drilling activity as well as an infrastructure build-out.

The agency expects the Henry Hub natural gas spot price to rise from an average of $2.50 per million British thermal units (MMBtu) in 2016 to $3.12 per MMBtu in 2017.

According to state data seen by State Impact, just over 54,500 Pennsylvanians are employed by businesses that extract oil and natural gas, provide supplies to the energy industry or companies that provide goods and services to energy workers.


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