Not every industry faces the same challenging conditions in attracting talent, such as the economic and social impact of COVID-19, rising inflation, extensive digitalization, and an aging workforce. To adapt, business leaders have been developing new employee onboarding and retaining strategies and introducing other oil and gas talent trends described in our blog section. Meanwhile, understanding the evolving perceptions within the workforce will be vital to prepare for upcoming transformations in approaches and principles of talent development oil and gas companies use.
Top four talent management and acquisition trends to follow
Before we discuss the new processes that managers should introduce for effective talent retention and development, let us outline the key oil and gas talent trends in 2022. They will help us understand the new priorities of the ever-more purpose-driven professionals and what activities we should focus on first.
1. The rising need for tech and digital skills
We see that data analytics platforms, industrial IoT, and cloud computing continue driving advancements in the sector. This galloping digitalization has shifted the emphasis toward digital skills. Yet, 43% of organizations are trying to deal with the global IT expert shortage. Forward-looking leaders therefore continue to upskill the existing workforce and introduce workable tactics to overcome skill gaps and mitigate oil and gas talent shortage risks.
2. Immersive training embedded in the workflow
The industry continues to widely adopt virtual reality and digital twin technology to take employee training to the next level. Today, workers can undergo no-risk simulations of actual field activities before doing them in real life. Computer simulation is an effective tool to train personnel in everything from drilling techniques to soft skills. So, it’s no surprise that virtual training is one of the biggest oil and gas talent trends in 2022. It can help to not only facilitate employee onboarding and improve retention but also streamline the acquisition of new competencies and skills.
3. Signs of the US oil and gas employment recovery
The American labor market can benefit and grow amidst the rising oil prices and positive market sentiment. The United States is aggressively increasing production and expanding LNG export to the EU buyers disrupted by Russia’s invasion of Ukraine.
Thus, the US oil and gas employment market is projected to revive and grow by 12.5%, totaling 970,000 jobs by the end of 2022. Nearly half of the jobs lost during the pandemic have already been recovered. Yet, gone are the days when oil and gas talent hiring was easy and even despite higher wages, many workers are not coming back.
4. The labor market shift and talent shortage
The bleak year of 2020 led to the loss of over 120,000 energy jobs in the United States. Given that nearly half of its workforce was let go, is it any surprise that the energy sector is facing a labor shortage today? Many oil and gas workers left the industry and switched to more stable renewables or manufacturing, where the transition seemed natural. Some also opted for technology and digital sectors that offer high wages and good benefits. But the most important issue is that they are hesitant to come back.
Drilling and well delivery (14%) and geoscience (12%) are the most challenging roles to fill. The industry endures hard times attracting younger people to replace retiring professionals who represent nearly half of the energy personnel. Add to this the oil and gas industry poaching from rival firms, and we have a nearly desperate situation for talent development oil and gas companies to solve.
Why attracting younger talent requires updated messaging
Younger generations perceive the oil and gas industry as negative and archaic. Around 62% of Gen Z and 14% of millennials reject the idea of career building in the oil and gas sector. As the younger generations represent 46% of the current U.S. workforce it is crucial for leaders to propose innovative approaches to talent development that oil and gas companies should adopt.
It is important to remember that the energy sector must compete with other industries that appear more attractive to Gen Z and millennials. To address this, organizations should revamp their structure and cultural practices to meet the needs of the younger generation and challenge the damaging misconception that the industry is digitally resistant.
Effective talent development strategies for oil and gas companies to adopt
Maximize the use of technology to enable more remote work
Young professionals are digitally oriented individuals who are drawn to industries where technology solutions have a significant impact. Therefore, companies should focus their corporate communication on their digital initiatives and technological expertise. Organizations should communicate to potential young employees how digital transformation is rapidly advancing within the company and how they can play a pivotal role in driving this change through the use of remote monitoring systems, Industrial Internet of Things (IIoT), data analytics, and business automation. The wider use of remote technologies and telecommuting tools, such as video conferencing, offers viable opportunities for younger professionals to engage in effective remote work.
Sustainability should be positioned as a core business value within the organization Environmental, Social, and Governance (ESG) factors are crucial considerations for 85% of oil and gas professionals when making career decisions. Understanding the perceptions and priorities of both current employees and potential hires is essential for attracting top talent. To address this, companies should integrate sustainability into their core values to signal a genuine commitment to this critical issue. Developing a comprehensive ESG strategy, investing in sustainable technology solutions, and setting clear, impactful goals are essential steps in aligning with the workforce’s values. For example, BP is actively transitioning to renewable energy sources as part of its strategy to address climate transition and reinvent itself for the future.
Highlight career opportunities
From the outside, the industry can be perceived as a market with little room for growth. But this doesn’t have to be the case. Investing in building transparent career paths and structured salary schemes for newcomers can help attract talent. Meanwhile, helping the existing workforce discover and understand their career opportunities can prove equally beneficial.
Adopting a more flexible labor strategy allows young workers to develop diverse skills across various roles. Providing them with the freedom to pursue their passions, along with offering decision-making authority and leadership opportunities, enables them to shape a personalized career path. This approach not only fosters individual growth but also cultivates a new generation of skilled professionals in the field. Organizations should emphasize this in their messaging to potential hires, showcasing the future of talent in the oil and gas industry and the promising career opportunities available within the company.
Promote flexibility and work-life balance Younger generations increasingly expect greater workplace flexibility and are drawn to organizations that embrace this modern approach to work. Therefore, companies should consider how a flexible working environment can be integrated within the parameters of their business operations. Implementing hybrid work models for office-based employees, allowing them to work remotely several days a week, is one potential solution. Additionally, offering employees more control over their schedules enables them to work in a manner that suits their individual needs. This approach not only adds value but also fosters a sense of ownership.
Currently, less than 1% of oil and gas organizations provide flexible workplace options, presenting a significant opportunity for organizations to leverage these talent trends and position themselves for success in 2022 and beyond.
Enter a pool of professionals outside oil and gas
Companies can expand their recruitment reach by leveraging remote work strategies and modern technological solutions to attract professionals from around the world. As existing workers retire and industry shifts create demand for new skill sets, it is crucial to target younger recruits or consider partnering with oil and gas talent
consulting services. As a firm offering diverse consulting services, we assist clients in transforming into tech-savvy, people-centered organizations that thrive, even in a competitive labor market.
The takeaway
Following these oil and gas talent trends of 2022, organizations can significantly improve workforce retention and company employee brand image. It is essential that organizations match the pace of these rapid shifts to future-proof job pipelines with young professionals while retaining the expertise of industry veterans for a smooth knowledge transfer.
To make this happen, companies should initiate internal changes to corporate culture and put effort into reshaping Gen Z and millennials’ perceptions of the industry. Therefore, don't be surprised if you find that consulting experts are needed to guide and support you during this transformative era.