Oil and natural gas industry professionals in the United States are the sixth best compensated in the world, according to an annual report by the Australian consulting firm Hays plc and Oil and Gas Job Search (OGJS), an industry jobs website.

“The industry is taking positive steps in increasing pay and benefits that will keep the U.S.A. competitive on the world stage, but there is still some way to go to stop a drain of talent to overseas markets,” said Hays Managing Director Matt Underhill.

The local average annual salary at oil and gas companies in the United States totaled $121,400, a decrease compared with $124,000 in last year’s report and slightly less than in Canada ($123,000). The highest average industry salary is found in Australia ($163,600), followed by Norway ($152,600), New Zealand ($127,600), Netherlands ($123,800) and Canada, according to the report.

Meanwhile, imported oil and gas professionals in the United States are earning an average $123,800, according to OGJS, which found the highest levels of pay for expatriots in Australia ($171,000), the Philippines ($170,000) and Trinidad ($168,800).

The salary guide, which based its figures on survey responses from more than 25,000 industry professionals across the globe, found that bonuses are the dominant mechanism by which companies attract and retain talent. On average, bonuses account for a further 5.9% of employees’ overall compensation package, and almost two-thirds of respondents said they receive some kind of benefit or allowance on top of their basic salary.

Employer confidence in increasing staffing levels during 2013 remains high, according to the survey, which found that 25% of employers expect staffing levels to increase by more than 10% this year, and almost 75% anticipate some level of increase.

Skill shortages are the major concern of industry employers, according to the survey. More than 37% of those responding said their main concern was skill shortages; economic instability (25%) was second, followed by environmental concerns (11.8%).

A “stunning” increase in Texas oil and gas industry employment, which was revealed by revisions to recent workforce statistics, was driven by gains in the number of jobs supporting oil and gas exploration and production, according to the economist who compiles the Texas Petro Index (TPI), a barometer of the industry’s health in the Lone Star State.

The number of Texans estimated to be on oil and gas industry payrolls in February reached a record 270,300, according to statistical methods based upon Texas Workforce Commission (TWC) estimates revised in March. Industry employment in Texas dropped to a low of 179,200 in October 2009 after reaching a high of 223,200 in October 2008 during the previous growth cycle.

“Before the [employment data] revision, the TWC estimated that total upstream oil and gas employment in Texas was slightly more than 250,000 at year-end 2012,” said economist Karr Ingham. “Following the revision, the number of Texans estimated to be working in the upstream sector of the oil and gas industry at the end of the year increased to more than 267,000.

“Employment at companies in the ‘support activities’ category, which includes drilling and service companies, accounted for all of the jobs added to oil and gas company payrolls in 2012, highlighting the importance of the exploration function in industry job creation.”

In a separate report, the Texas Independent Producers & Royalty Owners Association (TIPRO) found that the domestic oil and natural gas industry paid a national annualized wage of $107,200 last year, 119% more than the average private sector wage of $48,900 “and higher than average wages for construction, manufacturing, wholesale trade, information, professional services, health care, financial services and education services.”

The U.S. oil and gas industry employed 971,200 people in the first half of 2012, up 7% from 2011, and had a payroll of $104 billion, a 12% increase from 2011. Texas led the nation in oil and gas jobs with 379,800 people employed in the industry, according to TIPRO.

A composite index based upon a group of upstream economic indicators, the TPI in February increased to 275.0 from 274.5 in January and 270.9 in February 2012. The TPI reached an all-time high of 287.8 in October 2008 and then declined to 188.5 in December 2009 before embarking upon the current growth cycle. The TPI peaked in the current cycle at 275.5 in August 2012.

Last year a Schlumberger Business Consulting (SBC) survey found that the challenges of developing oil and gas resources in unconventional plays and in the deepwater have raised the bar for geosciences and petroleum engineering professionals and heightened the importance of human resource management at exploration and production companies (see NGI, March 12, 2012). An outflow of more than 22,000 senior key geoscientists and petroleum engineers will occur by 2015, according to SBC researchers.

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