The energy sector has always had real appeal for new grads, especially engineers.
It’s an adventurous career which promises high rewards for hard work. It constantly pushes the boundaries of human achievement in terms of technology and ingenuity. It can offer huge opportunities and unique experiences in some of the world’s most incredible places.
But recently it looks as though much of the shine has come off the oil and gas industry for new grads, as the words ‘labour surplus’ dampen enthusiasm. Unfortunately, these words are quickly being followed up by two more, which are far more concerning for the industry as a whole: ‘skills shortage’.
It’s unsurprising that new graduates – and experienced workers – will start looking for work in other industries under the current conditions. But it’s also a trend that we need to address if we’re going to make good on the increasingly likely recovery in the energy market. It’s time to start building the next generation of exceptional talent now, before labour demand turns around – which it inevitably will.
History has something to show us here. In the 80’s, the oil price plummeted and new graduate/new entrant hiring went into a freeze for a decade. On the counter-cycle upwards climb in oil price from the mid 90’s, this caused a huge stranglehold on industry productivity as companies scrambled to find enough people to deliver their projects. Even today, you’ll notice a “bald” patch in oil and gas workforce demographics, where those 20-year-old graduates in the 80’s (now aged around 50) did not enter industry, causing all sorts of headaches in terms of succession planning. Thirty years later, faced with another downward market inflection, are we repeating the same mistakes? It certainly seems like it.
So why do we keep making the same mistake? Cost is certainly a big factor. It’s an undeniable fact that the cost of bringing graduates/new entrants into the oil and gas industry can be in the order of thousands of dollars, particularly when talking about the cost of training and supervision – and it makes sense to be frugal where possible. But if companies continue down the path of freezing hires, particularly in the graduate market, the industry will choke itself out – again – when the market turns.
The answer? It’s complex, and dependent on factors often outside of their control, but those companies that can master the art of building stock in these challenging times will be first movers on the other side. Management should be readying themselves to explore flexible modes of engagement. Part-time or internship roles are sound, cost-effective ways to engage graduates and build capacity in organisations, and these tactics need not be reserved for the super majors. Those companies that manage to maintain this trickle of workforce continuity now will be building resolve into the future.
Rigforce communications are intended to provide general information and commentary and should not be taken as professional or legal advice.