Why Falling Oil Prices Might Mean More Workplace Injuries
- April 20, 2016
- Work Injuries
Lower gas prices are providing a boon to consumers and motorists. Typically, when fuel prices drop, people are left with extra capital to spend, and businesses save money on shipping costs. However, for one sector in particular, lower fuel prices disrupt business in ways that leave workers and employers facing serious challenges.
In the oil and gas business, lower prices can create a number of obstacles. Perhaps the biggest challenge is keeping workplace safety standards as high as they were before prices dropped. While it might seem counterintuitive for the rest of us, oil workers will know precisely what this means. Let’s take a look at a few ways in which workplace safety might be negatively affected by falling oil prices.
Three Ways Low Oil Prices Might Be Dangerous for Workers
- Cutting Costs – Perhaps the most important underlying factor of safety concerns in the oil industry is the fact that lower oil prices mean less profit for oil companies. Diminished profits leave companies looking for ways to reduce overhead and cut costs. It is not uncommon for companies to reduce their activities or expedite their current operations in an attempt to keep things running while times are tight. Companies might be tempted to neglect equipment safety inspections or to rent cheaper equipment to further reduce costs.
- Increased Use of Independent Contractors – Oil companies might also increase their use of third party workers, or contractors, to avoid using their own employees. Generally speaking, hiring independent contractors saves companies money, due in part to the fact that businesses don’t have to pay payroll taxes for contractors. Another added benefit of using contractors is reduced liability in the event of a workplace accident.
- A High-Stress Work Environment Affects Safety – If workers are under increased pressure to quickly finish projects, it can spell disaster for the safety of a work environment. Time constraints might force workers to rush to finish a job, increasing the likelihood of an accident or workplace injury. A stressed worker might also be more likely to make mistakes, causing injury to themselves or to their coworkers.
Why A More Active Sector Might Be a Safer One
The Center for Disease Control and Prevention analyzed data from the Bureau of Labor Statistics from 2003 to 2013, a period in which the number of employees in the oil and gas extraction industry doubled. They found that although the number of work-related fatalities increased by 27.6 percent, the annual fatality rate actually fell 36.3 percent over the same period of time.
This drop in the overall fatality rate makes sense once you consider the connection between increased profitability and workplace safety. For example, businesses have more capital to invest in both maintenance of equipment and the purchasing of newer, safer equipment that poses less of a safety risk to employees. Businesses can also afford to hire more workers, decreasing the workload on existing employees.
To be clear, even at the best of times with the highest oil prices, the oil and gas extraction industry is by no means a model of workplace safety. During the highly productive period of time mentioned above, there were still 1,189 reported work-related deaths in the oil and gas extraction industry. Rather, the point is that oil and gas workers might face even more perilous work conditions when profit losses force companies to find ways to further cut costs.
If you or a loved one has been injured in a workplace injury, you might be able to seek compensation for any medical bills, injuries, and loss of income or loss of work capacity that you suffered because of an unsafe work environment. The Dallas workplace injury attorneys at Guajardo & Marks can evaluate your case and determine the best course of action moving forward. Contact us today for a free consultation.