Low Oil Prices Push Chevron to Cut Staff 12%

Reacting to slumping oil prices, Chevron Corp. said today that 4,500, or 12%, of its regular employees will be cut through voluntary and mandatory early retirement.

In addition, the company said it will eliminate about 3,000 contract employees ranging from oil-field workers to secretaries. About one-fourth of the regular employees losing their jobs will be in the San Francisco Bay Area at the company’s headquarters.

‘Traumatic Changes’

“We’ve experienced the most traumatic economic changes in our industry in a generation,” Chevron Chairman George Keller said. “The steps we’re announcing today simply must be made if we’re to remain a viable enterprise both in today’s market and over the long term.”

At the end of 1985, Chevron had 61,000 workers worldwide. By the end of this year, the company expects that number will be 52,000.

About 1,200 of the company’s 15,000 workers in the Bay Area are targeted to lose their jobs. Another 900 workers have been identified as being “excess” in Anchorage, Alaska; La Habra and El Segundo, Calif.; Denver; Plantation, Fla.; New Orleans; Houston, and Casper, Wyo.

Will Notify by July 7

The company said employees in departments identified as having too many workers will be notified by July 7. They will be given three weeks to decide if they want to voluntarily take early retirement, which will be open to all employees with more than 10 years’ seniority.

Those taking early retirement will have four years of service with the company and four years of age added in computing their pension benefits.

If not enough workers voluntarily take early retirement, the company will make the necessary cuts but will give those retired workers the same enhanced pension benefits.

The work-force reductions are expected to be completed by November.