Yesterday Sikorsky Aircraft announced it will lay off 120 workers and choose not to renew contracts with 600 others at their Coatesville operations center.  The job action brings the total number of full-time employees employed at the plant below 1,000.

Spokesperson for Sikorsky, Paul Jackson said, “sustained decreases in oil prices continue to drive significant declines in capital investments by oil companies in offshore oil exploration projects, impacting Sikorsky and resulting in reduced production levels.”

Is it possible that the layoff had little to do with  United Technologies announcement of plans to sell Sikorsky?

Certainly.

Trouble for oil and gas can have a huge impact on other sectors. As Jackson alluded, orders from oil and gas companies account for about 80 percent of Sikorsky’s commercial helicopter business.

With the cost of crude oil reaching historic lows, those companies have little incentive to expand. And Sikorsky isn’t the only down-stream company to suffer, as investopedia.com points out:

Oil companies are not alone in feeling the pain of low oil. Manufacturers and industrial companies are also feeling the pinch as this industry is responsible for supplying the materials to build and expand oil drilling operations. Oil producers are not undertaking new projects at the moment and are instead cutting back production. Makers of steel, machinery and machine parts, and heavy equipment are all affected.

U.S. Steel (X) and ArcelorMittal (MT), two of the world’s largest steel producers have seen their shares drop around 30% over the past six months.

Caterpillar(CAT), which supplies heavy earth movers and other industrial vehicles to the oil industry, is down 18% over the same period.

Halliburton (HAL), a diversified company specializing in oil field services to support the energy industry, is down 36.31%.

Another company in the oil services sector, Schlumberger (SLB) is down nearly 21%.*

That could mean more bad news for Coatesville. ArcelorMittal employs about 820 at the old Lukens Steel mill there. To make matters worse, steel companies are also particularly sensitive to changes in defense spending – spending that has been trending downward in recent years.

So cheap oil, while a boon for consumers, has some unexpected consequences particularly when it comes to important, meaningful jobs for Chester County’s blue-collar labor force.

And that’s something to think about the next time you fill up.

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*From an article published in February, 2015