Inside story behind 2012’s booming oil and gas job market

15 May 2012 (Last Updated May 15th, 2012 18:30)

As the age of austerity bites deeper, it’s encouraging to report that oil and gas sector recruitment is improving. Ian McInnes spoke to Graeme Fyfe, Hays Oil and Gas’s Aberdeen office director, to find out what's behind the significant boost in offshore recruitment and job opportunities reported in the recently released Oil and Gas Global Salary Guide 2012.

Inside story behind 2012’s booming oil and gas job market

Oil and gas job market: open for business

"Poaching is very much at the mindset of owners at the SME (small to medium enterprise) end of the business and is a hurdle to recruitment."

Using data input from 14,000 industry professionals, the Oil and Gas Global Salary Guide 2012, produced by Hays Oil and Gas (Hays) and the leading jobsite, Oil and Gas Job Search, points to a hiring situation in the industry which has improved on last year and become friendlier for entry level graduates.

Graeme Fyfe is the director for Hays' Aberdeen office and offered some insights as to why graduates are more welcome in the oil and gas industry. "I think companies have realised that the reality is that the industry doesn't have enough skills in it and that they need to find routes to be able to facilitate the future."

"One of the limitations that most of the industry has at the moment is that they can't just buy people in from abroad," says Fyfe.

That reality, coupled with governmental advice, seems to have set in as older workers retire. "I think graduates have got a better chance at the moment than they've ever had to get a job because companies are now saying right, we need to think about the future, we need to think about succession planning and the fact that there's more people leaving than entering at the other end. What do we do about it?

"Therefore graduates, everyone with an engineering background, are now getting a chance again."

In the past, engineering courses have not exactly hit the number one spot for students and that is part of the problem. "If you look at engineering particularly, engineering during the last 20 years or so has really taken a beating because it's not been seen as an aspirational industry to go into," explains Fyfe.

"Therefore with university intakes, I think those kind of courses have suffered quite a lot."

Recruits no longer dependent on engineering degrees alone

There are also opportunities for graduates that haven't taken engineering degrees, says Fyfe. "It depends on what they want to do. There are quite a lot of companies that will take people on at a pretty raw end of the spectrum for more junior roles. Some companies are running graduate training programmes for more generalist skills. I think there's an opportunity for those people," believes Fyfe.

"The document side of it, the actual negotiation of contracts, you tend to find people that have business related degrees, such as administration. At that end there's a lot more basic skills such as numeracy and written English and your personality in terms of being able to stand toe-to-toe with someone and negotiate a contract with them," says Fyfe.

"So those kinds of graduates will get a better chance for those kinds of jobs rather than mechanical engineering. There's an actual intellectual property element of that kind of job."

Oil and gas market 2012: a sea change for recruitment

Fyfe highlights that aside from the companies that have always had graduate training programmes, there is a sea change taking place in other companies. "More and more of these companies are taking bigger intakes of graduates," says Fyfe.

"In the past, engineering courses have not exactly hit the number one spot for students and that is part of the problem."

"Organisations like EMEC (European Marine Energy Centre) and Subsea 7 and people like that are taking in quite a number of graduates." Moreover, the trend seems to go further: "What you're starting to find now is that companies lower down the food chain are also beginning to take graduates as well and training their own and that's something that we maybe haven't seen so much of in the last two years," explains Fyfe.

"Some of the suppliers too, they're also looking at graduates and I suppose that kind of indicates where the industry is at in terms of skills because these companies have been very reticent about taking on graduates, because what they would find is that other companies would take them off them after a few years and basically poach them."

Poaching employees certainly seems to be an issue that needs a solution sometime soon: "You have this kind of constant poaching all the way up the food chain towards the operator end," says Fyfe. "I don't know how the industry can resolve this issue but it's got to think about it."

Certainly poaching is very much at the mindset of owners at the SME (small to medium enterprise) end of the business and is a hurdle to recruitment.

"It is them that often train these guys in the actual intricacies of the engineering that they do," says Fyfe. "There's got to be a balance but I don't know how you would ever resolve that issue, because obviously people have their aspirations and they can't have their trade restricted. I think this conundrum is perhaps why graduates have struggled to get jobs."

A lack of skills is forcing change in offshore recruitment trends

""One of the limitations that most of the industry has at the moment is that they can't just buy people in from abroad," says Fyfe."

With uncertainty looming large in the global economy it is not surprising that companies have been reticent about taking on graduates and training them, but circumstances have caught up with them. "There are precious few other options," says Fyfe. "There are not enough experienced people out there and therefore they need to work at training their own."

Of course, the price of oil and gas is volatile and once again they seem to be falling again, after a period of high prices. In the Hays Oil and Gas Global Job Index for the first quarter of 2012 there is a note of caution: "If the debt worries in Europe dissipate then we see no barriers to the index rising well above the 1.39 level we see today.

"However if there are further reverberations in the financial markets and the oil price drops below US$60/bbl (barrel) then we would expect a sharp decline in the index to below 0.8."

With a comfort zone for many oil producers being a price per barrel of between $80.00 and $100.00 there is, hopefully, a bright future for new graduates to continue to join and prosper in the oil and gas industry.