Nearly 90% of human resources (HR) executives at 22 top international oil and gas companies believe their industry faces a talent shortage and call the problem one of the top five business issues facing their companies, according to a recent survey.
Working with Houston's Rice University, Ernst & Young LLP gathered insights on the challenges of workforce recruiting and retention. 88% of survey respondents agreed the shortage has the potential to impede growth and financial performance.
Respondents to the survey found challenges related to corporate growth, financial performance due to rising costs, operations and safety, among others. They are not the first to notice; a shortage of workers from the oil patch to the executive suite has been documented and commented on by others (see NGI, Mar. 3; Feb. 18).
"It is clear that the talent void in the oil and gas industry has transformed from an organizational challenge into a critical business issue," said Dina Pyron, a leader in the human capital practice within Ernst & Young's Global Oil & Gas Center. "The lack of key talent could potentially impact corporate growth, financial performance, safety and reputation. This should raise a red flag to leadership that immediate and innovative solutions are necessary."
According to the findings, the greatest threat to recruiting and retention is competition from counterparts within the industry. Respondents ranked competition from peer companies as a major challenge. 88% of respondents cited increasing compensation as their primary solution to keeping and attracting talent.
"Compensation is important, without a doubt, but the survey results show there is a real opportunity to do something different, stand out from the competition, lure new recruits and create loyalty among existing employees," said Bill Lee, associate dean of executive education for Rice University. "The first company with a breakout strategy could position itself as the leader in a highly competitive recruiting and retention environment."
Ernst & Young's suggestions:
Included in the survey were four supermajors, six exploration and production companies, six oilfield services companies, four natural gas companies and two refiners. The respondents had an average of 22 years industry experience and nine years experience with current employers.
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