72% of Energy Executives Struggle to Attract Talent
The highly technical and specialised nature of the energy industry means that attracting and retaining the right talent will always be a top concern for executives – 72% of which say they struggle to find the talent they need. But an ageing workforce, advances in technology, and a reduction in qualifying entry-level recruits, has created a pressing issue.
Following summer 2015, when oil prices fell by more than 70%, severe cost reduction measures were put in place. Staffing levels in the upstream and, to a lesser extent, mid-stream sectors fell rapidly. Although prices have now stabilised and the industry is adjusting to the lower pricing environment, experts predict that we will see increases in M&A activity, which may lead to further losses of experienced talent.
Labour shortages will, in fact, remain a major concern across all sectors of the industry and all critical occupational groups over the next 10 years. The average age of employees in the downstream sector is much older than those in the upstream sector. In addition, the rise in unconventional energy projects, which require more labour-intensive staffing models and involve new complex technologies, are creating experience gaps and staffing shortages. This is leading to fierce competition among operators to attract and retain talent.
The Widening Global Experience Gap
In certain geographies, the talent pool is older and there is a lack of new recruits to fill impending experience gaps. This is a particularly pressing issue in North America and the Commonwealth of Independent States (CIS), which have the highest percentages of employees approaching retirement. Asia, the Middle East, and Latin America have a much greater number of younger workers, but companies operating there are actively looking to attract more experienced employees rather than investing in extensive (and expensive) training of new hires.
Avoiding the Pitfalls of Talent Shortages
Given the highly technical, industry-specific skill sets needed to drive the future of the energy industry, it is critical that your organisation takes steps now to attract and retain talent. This should include a thorough examination of your employee benefits programmes, which can help differentiate your organisation. As part of this process, you should:
- Examine the age distribution of talent within your organisation and the ways different workforce segments are successfully attracted, retained, and developed.
- Get a true sense of employees’ benefits preferences. These are likely to differ depending on age and geography.
- Explore the potential for more flexible benefits schemes across the workforce spectrum.
- Harness the power of technology and data to inform and optimise the benefits process and provide a consumer-grade experience to actively engage employees.
- Consider ways to enhance and harmonise benefit offerings across geographies using a captive.
Strong performance management practices and well-developed workforce planning, combined with a robust employee benefits programme, can better equip energy organisations to not only forecast their future workforce needs but attract and retain valuable talent.