Talent Shortage To Drive Growth In Salaries In Oil And Gas Sector
The GETI from Swift and Energy Jobline reports 65% of workers believe that their pay will increase in the next year with only 5% expecting a fall. 39% think their pay will increase by over 5%. Those in Africa, Asia and South America are the most optimistic with at 70% anticipating a rise, whereas the report says that around half of those in Europe, CIS and Australasia expect a rise.
Hiring managers are also optimistic with 63% expecting remuneration to grow and around a third anticipating rises over 5%.
This follows a year where 41% have seen a rise in pay and 16% seeing a reduction.
This comes against a background of rising oil prices in 2018 from the low point in 2016. Average closing crude oil prices over the last five years:
- 2018 – $64.90
- 2017 – $50.84
- 2016 – $43.58
- 2015 – $48.72
- 2014 – $93.17
The driver for the rises in remuneration is the demand for talent with the report pointing to the decision to cut graduate schemes, apprenticeships and training during the downturn as leaving firms in a tough position. “Many corporations are reviewing salaries, because they want to prevent other companies from luring employees away” reports Hannah Peet, Managing Director at Energy Jobline. She adds “Executives have told us that they are genuinely afraid of having talent poached.”
Global mobility is high in the industry with 92% saying they would consider relocating to another region for their job. However, only 9% of respondents give remuneration as the main reason to be attracted to move to a new location. 37% gives career progression opportunities as the main reason for being attracted to a new location. Lifestyle (16%) and culture (11%) are also popular considerations.
As Peet notes “During the downturn, professionals moved abroad because local employment was scarce. Now local jobs are abundant, but a lot of the workforce still wants to move. This tells us that global mobility is driven by the desire to work on more career-advancing projects’.”
The Middle East topped the rankings for preferred regions despite not being in the top three in 2017.
The survey shows that professionals see a skills shortage as the issue creating the most concern. Nearly half are either quite worried (31%) or very worried (17%) about an impending talent crisis in the sector. 40% believe the crisis is already here and 16% feel it will happen within two years.
Engineering (55%) and project leadership (24%) are the most likely business functions to be affected by an impending talent crunch.
Renewables is the sector that 42% point to as the most popular to consider switching to up from 28% in last year’s report. 31% point to Petrochemicals and 21% to Power. The main reasons given for choosing the sector are opportunities for career progression (35%), interest in the wider industry (21%) and innovation (15%).
The need to maintain a pipeline of new talent is the challenge for oil and gas companies and Janette Marx, CEO at Airswift, summarises by saying “The oil and gas industry is learning from its decision to cut back on graduate recruitment. Leaders and hiring managers realise that the world has changed and the desires of young professionals are very different. Providing individuals with opportunities to grow their career, travel and work with new technologies will be crucial.