Experts have predicted that the aging workforce will have a significant impact on future labour and skills shortages, which will be detrimental to the Oil and Gas sector in years to come.
Therefore, addressing the long-term need for talent and enticing younger generations into the industry is critical.
In an industry where no-one thinks twice about investing multibillions in technological advances or product development, it is odd that so very little is put into our very lifeblood – the people who run it.
This is not new. It’s been the way for thirty years. However employers are now being advised they must act to bring the chronic talent shortage to an end or face critical long-term personnel shortages. Whether or not that happens at a time when production is expensive, demand is low and prices even lower remains to be seen. Precise Consultants believe it is crucial.
The fall in oil prices and cut in production has obscured the reality of a lack of qualified professionals. KPMG’s principal strategy energy and natural resources lead Chris Click says we need to anticipate a $50-$60 per barrel range for a while, and although companies are taking a conservative approach to CAPEX in 2016, knee jerk reactions aren’t the answer – what is required is a more strategic approach.
The Great Crew Change is happening now. Thousands of jobs have already gone from global companies including Shell, Petrofac and Shlumberger as the oil price tanked last year and there are predictions that as many as 35,000 jobs in the UK could still go in the next five years.
Those industry leaders who look to the future are alarmed. David Doig CEO of OPITO International which promotes skills and learning in the workforce says he is seeing a lot of really highly skilled people who are unemployed. “They won’t all come back and that exacerbates the skills shortage. Once you’ve been made redundant, changed your life and got another job in another industry, it’s unlikely you’ll come back when the good times arrive again,” he warned. “So you lose that knowledge and expertise in a downturn; that wisdom of ‘we’ve been here before; I understand this project’. It feeds into the skills shortage.”
The recent KPMG survey calls for fresh thinking to address the problem. It came up with five key strategies for companies to implement now: come up with your workplace planning model, make the most of analytics, manage third parties better, safeguard knowledge and rethink the employee value proposition.
OPITO want to involve other agencies. It suggests strategic investment designed to take people all the way form schools through to higher education and then into business, and is working with the Oman government on a long term plan right now. “They put the money where their mouth is, as a comprehensive government and industry coalition,” says Doig. “We see the same in places like Malaysia. They’ve invested hundreds of millions in developing this skills base, even at $50 a barrel. They don’t get affected by that; they just see it as something they have to deal with.”
It’s similar to something Skills Development Scotland have started doing, with an incentive that gives companies £5000 to take on an apprentice who loses their job in another programme.
With ‘new normal’ circumstances, recruiters should expect to see a new way of working. This includes talent and expertise sharing, and what the chief HR officer at MorseLife Kris Cooper described as “the new hot girl at the dance”, Big Data. This is how recruitment is predicted to adapt to the changing workforce – social media will not be effective anymore so instead Cooper says “Big Data is an opportunity to take blinders off everything that we’re doing. (It) really levels the playing field by summarizing data points in a way to provide answers to important questions” of HR professionals.
One of the big questions we will face as an industry is how to attract millennials, whom some say will make up 75% of the workforce. It’s estimated only a third have a plan that directly targets this age range. But getting them on board won’t be easy. As Cooper points out, they are of a generation that is particularly environmentally-conscious, and they “like authenticity and freedom and care about company values and how they can get promoted and advance their careers.”
Recruitment and retention is a huge problem particularly when highly skilled people are in demand. Looking after employees is not a one way street. Supporting your staff – looking after their interests and recognising their career development needs – creates a supporting workforce, as people become loyal to your company and develop a team ethos. That’s the sort of workforce money cannot buy.
Doig warns that until companies truly start to collectively address the industry’s long-term problems, they will only get worse. Other industries are actively developing sustainable strategies that attract a workforce and carve out a unique market position.
Short-term plans that suit companies now, generally don’t suit employees. Short term plans also don’t tend to benefit companies long-term either. By creating a unique tailored strategic plan to increase the skilled workforce now, companies can ensure that when this cyclical industry turns around there will be people ready to take up the positions to drive it forward.