Dash for the Cash
At Texas Tech University in the early 80’s, we had an expression for our desire to join a major oil company as a Geologist or Geophysicist to get the big paycheck. We would say “Dash for the Cash.” Oil companies were paying top dollar for Maters Degree students to join them and help them find oil.
Dash for the Cash [then] Prepare for the Crash
In the early 80’s, prosperity in the oil patch had the price for a barrel of West Texas Crude marching toward $40 with no end in sight. Fresh out of school Geoscientists, Master’s degrees in hand, were seduced by oil exploration companies with colossal new-hire salaries.
Blinded by the euphoria of big paychecks, abundant oil, and endless opportunity, none of these green recruits could predict, or would even ponder the possibility of, an end to the boom and a crash in oil prices. They were naive and they raced in their dash for the cash.
Those who had been in the industry long enough, knew that boom and bust cycles were inevitable. But, do you think the oil company executives and gurus would let on, to the new hires, that this is a volatile commodity and busts and layoffs were just as certain as booms and hiring? Why would they. All they have to do during a bust, to secure their positions and please the share-holders, is lay people off. They don’t forego a raise, lose their jobs, or, heaven forbid, take a pay cut.
But, the poor shmuck, who just started his or her career and family, is out on the street. The company executives should be the ones to forecast a bust or, at least, warn of its inevitability and prepare the company, shareholders, and employees for it. But, they don’t want to scare off investors or new hires and, in the end, they won’t even reduce the dividend to share-holders when a bust comes. The fresh recruits will take the hit and have to reset their lives so the rest of execs. and investors can avoid the pain.
I got six offers from oil companies in 1981, an offer from every company I interviewed with. And I was selective, only going for big high-profile companies. Exxon, ARCO, Mobile, Phillips 66, Amoco, Union 76. They flew me around Texas and Oklahoma. They wined and dined me. They pulled out all the stops to get me to sign with them.
But, my adviser at Texas Tech had a cautionary comment for me. He said that he had seen all this before, in the 50’s and 60’s, and he was pretty sure that history would repeat itself. You see, he had been with an oil company and it was the decline in of the 50’s and 60’s that caused layoffs and convinced him to get out of the industry and go into academics. He was right.
The salary offers in the early 80’s were high. So high that the companies were forced to raise the salary of Geoscientists that were already with the company to bring them up to the offers we were getting. Some of us geoscientists were in the discipline because we loved studying the Earth and some were, naturally, attracted by the salaries.
We had a slogan for what we were doing in the early 80’s when we were going for the biggest salaries we could get. It was referred to as “Dash for the Cash.” And, my cautionary note is, don’t expect the oil companies to look out for you. You need to look out for the Crash.
Now, and starting in 2015, we are revisiting that cycle that is showing no signs of recovering.