While a difference of opinion is evident between oil and gas industry managers and employees, signs of optimism and a recovery are reflected in the first Global Energy Talent Index report released Thursday by two international energy job services companies.
The report surveyed 16,000 employees and hiring managers worldwide across five energy sub-sectors, including oil and gas. It tapped hiring managers from 350 companies for a better idea of the issues and trends confronting the global industry, hiring rates and even "energy hot spots." The report was authored by workforce solutions provider Airswift and the job postings website Energy Jobline.
"We're starting to see slight signs of movement," said Energy Jobline Managing Director Hannah Peet of the industry's current state. "We have also seen a massive global asset reshuffle and a very healthy mergers and acquisitions market."
The report found that while oil and gas industry employees expect a global recovery in the next year, hiring managers expect it to take 18 months or more. Specifically, 44% of employees see a recovery within the next 12 months, while 61% of hiring managers said it would take longer. "While we expect to see some recovery within the sector, we don't expect to be hitting pre-2015 levels," said Airswift CEO Peter Searle.
Sixty-eight percent of hiring managers said they expect to hire less than 10 people over the next six months. Thirty-five percent said they would hire less than 10 people during the next 18 months and 23% said they expect to hire between 11 and 20 staffers over the next 18 months. In a brighter finding, 37% of the managers surveyed within the oil and gas sector said they have rehired previously laid off employees.
After oil prices began to fall in 2014, both large and small companies across the world announced workforce reductions. They continued to persist as prospects worsened or companies merged to find greater synergies. Estimates have varied, but several studies have shown that hundreds of thousands have been laid off across the industry over the last two years or so. The Global Energy Talent Index pegs the number at more than 400,000.
The index, like similar studies, found that hiring managers believe the oil and gas industry is staring down a "talent deficit," with nearly three quarters of the managers surveyed agreeing that it could be difficult to fill some positions in the industry when the time comes. Globally, nearly half of the managers, or 46%, said they believe an aging and retiring workforce is to blame for the skills shortage. Managers said changes to retention and recruitment, as well as additional training and development are needed to bridge the gap.
"We're seeing a stronger appetite to continue to foster and even hire young talent, especially apprentices," Searle said.
But young graduates, according to the index, are shying away from an association with "the seemingly older and less eco-friendly oil and gas industry," favoring instead the "new technologically-driven green sectors."
One study from the University of Houston found that former oil and gas workers laid off in the recent downturn might not be eager to return to the field. The index found that 67% of oil and gas professionals would move to other energy sectors, particularly renewables. They cited job security as their biggest motivation.
In another finding, 24% of employee respondents said North America is the place they would most like to work. That was followed by the Middle East at 22% and Europe at 21% to round out the top three. Most cited better career opportunities in identifying the hotspots.
In the U.S., oil and gas jobs began to inch back up late last year, according to the Bureau of Labor Statistics (BLS). In data released earlier this year, BLS recorded its first increase in oil and gas extraction jobs and support services in November for the first time since September 2014.
Peet said the adversity that the oil and gas industry has faced in recent years created an "incredibly resilient spirit from the sector." She added that it has "used the past two years to streamline it operations, shed layers of bureaucracy," and look for economies of scale.