U.S. Markets close in 6 hrs 29 mins

Oil Industry Faces Imminent Talent Crisis

Irina Slav

The oil and gas industry is facing a potential crisis, and this crisis could hit in just a few years: a workforce shortage.

The problem is not exactly new. Its roots are generational, but the first signs of trouble only manifested relatively recently and were understandably ignored amid the latest oil price crash that led to several hundred thousand job cuts. Now, it is rearing its head.

In January this year, a survey by energy recruitment company Airswift found almost half of respondents were “either quite worried or very worried about an impending talent crisis.”

Only 30 percent of oil and gas professionals said that they were feeling ‘relaxed’ about finding talent in the industry, the survey showed. A total of 40 percent see a skills crisis already unfolding in their geographical area, while another 28 percent of respondents see the crisis hitting them within the next five years.

One of the areas already facing a shortage is Europe, and most specifically the UK. A recent article by Eddie Spence in Bloomberg looked into the reasons behind the shortage that could threaten the future of the industry. In short, these come down to worry about future job security and ethical considerations.

“People are worried that there aren’t going to be as many jobs in the future, especially geology-related jobs because of a movement away from fossil fuels,” Spence quoted an earth science graduate from the University of Oxford as saying. “With oil companies making fewer discoveries and not wanting to invest as much in exploration, they’re worried in the future it’s maybe not going to be viable,” Robert Paver also said.

This lack of a belief in a long-term job security can be blamed on the oil price crash as well, which is when the UK oil and gas industry’s problems with new talent began. Yet there is also the generational factor: millennials and digital natives are less willing to work for an industry they consider unethical.

“University petroleum courses are being asked to take petroleum out of their name, because people think petroleum is the devil,” the chair of the Petroleum Group of the UK’s Geological Society, Lucy Williams, told Bloomberg’s Spence. “I suspect some people who start on it in their education and then get turned away from it.”

Related: Light Oil Set To Flood Global Market

This could certainly have grave implications for an industry that would need to add 25,000 new workers over the next six years, according to energy training and standardization non-profit OPITO. The good news is that 4,500 of these jobs will not be in traditional roles: they would be jobs in data science, automation, and new materials, all areas that don’t feature the p-word.

Focusing on the technological aspects of the oil and gas industry is one approach the industry can utilize to attract new talent, the Airswift survey suggested. Another, according to a 2017 report by EY, is finding new ways to advertise jobs to new target audiences, including by borrowing successful practices from other industries such as pharmaceuticals.

A focus on the technological aspects of the industry is what the Baker Institute’s Kenneth B Medlock III also believes to be the right path, as detailed in an article for Forbes. Younger generations are more tech savvy than older ones, he said, and technology is a much larger part of their lives than it used to be for their parents. Oil and gas companies could do worse than focus on the applications of various technologies in their business to attract young employees and secure the next generation of energy industry workforce.

By Irina Slav for Oilprice.com

More Top Reads From Oilprice.com:

Read this article on OilPrice.com