Hiring is picking up in the oil fields, but a sell-off in the crude market last week has created fresh uncertainty for jobs in the industry.
Employment data released last week suggest that improvement in the first three months of the year is continuing into the second quarter. Layoffs in the energy sector are at a nearly one-year low, but the industry was the biggest job cutter among U.S.-based companies in 2015 and 2016, so recruiters and hiring managers remain guarded.
"We are sort of holding our breath to see if the first four months was a fluke," said Gladney Darroh, president of Houston-based energy recruiting firm Piper-Morgan.
On Friday, monthly jobs data showed employment in the oil and gas extraction sector holding between 177,000 and 181,000 positions, continuing a trend that began a year ago. That suggests employment in the sector has at least stabilized after dropping from roughly 200,000 positions since October 2014.
The latest quarterly data from the U.S. Census Bureau's more comprehensive count of employers indicates a similar trend may be emerging in two related sectors: drilling oil and gas wells and support services for oil and gas operations.
The stabilization is due in part to a decline in layoffs.
U.S.-based energy companies announced plans to drop 459 workers in April, the lowest tally since June 2015, outplacement firm Challenger, Gray & Christmas reported Thursday.
That makes April only the second month that employers handed out fewer than 1,000 pink slips since October 2014, a month before the Organization of the Petroleum Exporting Countries decided against cutting production.
Instead, the exporter group, which accounts for a third of global oil supplies, let prices slide to 12-year lows, piling pressure on U.S. producers, many of whom rely on expensive advanced drilling methods to unlock oil and gas from shale rock formations.
Since then, the industry has shed hundreds of thousands of workers around the world as employers tightened their belts. About 250 North American drillers and oil field services companies have filed for bankruptcy, according to a count by law firm Haynes & Boone.
Drillers began steadily putting up new oil rigs last summer as prices stabilized above $40 a barrel, and later, above $50 after OPEC and other producers finally agreed to cut output. Lower costs and more efficient drilling methods have also contributed to a recovery in U.S. drilling.
U.S. energy companies are now adding employees, particularly in areas like Permian Basin in Texas and New Mexico, where crude can be drilled at relatively low costs.
Last week, LinkedIn reported hiring in the oil and energy sector among people on its platform was 30 percent higher in April than a year ago. Cities that have seen hiring rev up include Houston, Dallas, Oklahoma City, San Antonio and Pittsburgh, the data show.
Head count should remain on an upswing so long as oil prices stay where they are today — around $50 a barrel — said Guy Berger, an economist at LinkedIn.
Piper-Morgan, the Houston recruiter, reports it has done as much business in the first four months of this year as it did in all of 2016. Darroh said the firm believes the worst may be over.
"We're pretty optimistic that we've seen the bottom and we'll continue to grind upwards, barring any unforeseen precipitous drop in crude prices below $40," he told CNBC. U.S. crude was changing hands at around $46 a barrel on Monday.
That tone of cautious optimism is prevalent throughout the industry, a survey of hiring managers by recruiting firm Airswift and online job board Energy Jobline suggests.
Less than one-third of energy hiring managers anticipate the industry will recover in the next 12 months, while 44 percent of workers expect a rebound in that time.
The prospects for a stable recovery became clouded last week, as oil prices posted a third straight weekly loss, dropping on Thursday to levels not seen since before OPEC agreed to cut production last November. U.S. crude futures extended those losses in overnight trading on Friday, dropping as low as $43.76 a barrel in a sort of "flash crash."
Analysts told CNBC the sell-off was fueled by computerized trading and forced selling as oil futures crashed through a number of technical levels. Thursday's lows likely represent a near-term bottom, they say.
Still, some drillers will find their profit margins coming under pressure if crude prices trade around $45 a barrel, said Tom Kloza, global head of energy analysis at Oil Price Information Service.