Friday, May 30, 2008

Oil Greases Layoffs

The oil industry is wiping out jobs everywhere – except in the oil industry.

Talk about an octopus – with gas prices now at a national average of $4.04 a gallon, just how far can the job-killing tentacles from oil’s spiraling costs reach?

For starters ... the transportation industry. Five US airlines have gone under in the last three months alone and analysts are urging investors to dump airline stocks as fast as they can.

According to the NY Times, both Ford and GM are talking about shutting down much of their SUV and truck operations, including some of their most productive automotive facilities. General Motors minivan plant in Doraville, GA and Ford's midsize truck plant in St Paul are slated for the chopping block, resulting in thousands of layoffs.

And companies who manufacture tires, make engines, foam for dashboards, seats for airplanes and the rest of those dependent upon the transportation industry are having even greater difficulty seeing light at the end of the tunnel.

Next, the chemical industry, so totally dependent on petroleum, is about to take a real bath with DOW Chemical signaling the beginning of a tough cycle by announcing a 20% increase in prices and causing workers to wonder if layoffs can be far behind.

And with food prices rising and consumers pulling back, profit margins in the corporate suites of supermarket chains and the food & beverage industry will be scrutinized for cutbacks. Also, the hospitality industry. Hotels, restaurants and vacation travel will retrench as people and businesses reduce spending. The oil sector is truly impacting industries across the board and in many cases, layoffs are inevitable.

In the event your company is attacked by this octopus, you know where to look for a job ... the oil companies.

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