With a whopping market size of $130.6bn in 2023, up 26.1% from 2022, Australia’s oil & gas sector is a cornerstone of its energy economy. Yet it’s no secret that the industry is facing significant skills shortages across every state, with core oil & gas jobs including Drillers and Petroleum Engineers in record demand.
“Australia’s resources and energy sector, like many other industries, is operating through a once-in-a-generation skills crisis,” Australian Resources & Energy Employer Association’s Director of Operations, Tara Diamond, said in 2022.
It’s a skills crisis fuelled by various factors, including a shift towards clean energy, job shedding and an ageing workforce. Despite the growing momentum towards clean energy backed by government policies such as the National Energy Performance Strategy, the reality remains: Australia (like much of the world) is still heavily reliant on oil and gas.
So, how do we work through this crisis? We’ll delve into the major drivers of the oil and gas skills shortage, and ways organisations can move through it.
Industry Turbulence
The COVID-19 pandemic was a difficult time for the oil & gas industry, which experienced a 10.5% reduction in its workforce between 2019 and 2020. Uncertainty stemming from fluctuating commodity prices and geopolitical tensions have even further added to challenges in the sector, leading to apprehension among employees.
In fact, 42% of respondents to our 2023 employment survey said they were contemplating leaving the oil and gas industry entirely, with work instability, lack of employment opportunities and reduced pay cited as the top three reasons. This poses a considerable challenge to organisations in terms of maintaining workforce morale and retaining top talent.
To mitigate the threats posed by industry turbulence, implementing proactive measures to support your workforce is essential. Encouraging transparent communication regarding organisational changes, investing in employee wellbeing and professional development programs, and providing competitive compensation are all important ways to achieve this. For more on how to hold onto your top talent, see our blog on effective retention strategies.
The Shift to Clean Energy
The growing emphasis on sustainability and clean energy initiatives has reshaped industry priorities, prompting companies to explore cleaner alternatives and reduce their carbon footprint. Yet the transition to clean energy can’t happen overnight – and in the meantime, this messaging has inadvertently contributed to the skills shortage plaguing the oil and gas sector. Aspiring engineers and professionals increasingly perceive traditional energy roles as incompatible with their aspirations and lacking growth opportunities.
To address this, the oil and gas industry must adapt its messaging and recruitment strategies to target the next generation. This includes highlighting the sector’s commitment to environmental responsibility and sustainability initiatives. Additionally, investing in educational outreach programs aimed at attracting new talent will help mitigate our next major issue: the experience gap.
A Growing Experience Gap for Engineers
Approximately 10% of the oil & gas workforce possesses 0-10 years of experience, as our last employment survey shows. The remaining 87% had 10 years+, with 49% of all respondents having 20+ years’ experience. This is indicative of a significant shortage of early and mid-career professionals, which, left unchecked, will only exacerbate the oil and gas skills shortage even further.
Given the lack of early career workers, employers will likely have to dig down into initiatives such as internships, mentorships and apprenticeships to attract new talent. Absent a steady stream of graduates entering the oil & gas workforce, on-the-job training may be the only way to help fill the gap with local talent.
Changing Workforce Expectations
The pandemic has catalysed a fundamental shift in workforce expectations, especially around flexible work arrangements. However, in the oil and gas sector – where operations often occur in remote and challenging environments – accommodating these expectations presents yet another challenge for employers.
Our employment survey found that 80% of oil & gas employees hoped to be able to work from home in some capacity in 2023 – yet 15% of companies confirmed they would not continue offering WFH arrangements. This discrepancy highlights the need for companies to navigate the delicate balance between meeting employee expectations and addressing operational requirements.
To address this challenge, organisations could consider initiatives that promote work-life balance, such as flexible work arrangements (where possible), additional leave, and providing attractive accommodation and recreational facilities for employees stationed in remote locations.
Oil and Gas Jobs with the Most Acute Talent Shortages
Now that we’ve covered four of the biggest skills challenges in the sector and potential strategies for mitigating them, let’s delve into the top five job roles currently experiencing heightened demand in the oil and gas industry.
- Engineers: Whether they’re a Petroleum, Reservoir, or Drilling Engineer, these experts will remain in top demand. Our survey found a 38% uptick in Intermediate Drilling Engineer salaries between 2022 and 2023, followed by Reservoir Engineers at 37% and Petroleum Engineers at 20%. If you’re looking to recruit new engineers, read this guide.
- Geophysicists: Intermediate Geophysicists had a 10% increase in salary, according to our report, and with their advanced knowledge of geology and physics integral to the process of locating oil & gas, we expect demand to continue to rise.
- Geologists: Similarly, Intermediate Geologist salaries rose 23% in 2023. Development Geologists saw a whopping 47% increase – meaning this highly specialised role is also expected to be highly sought after in the coming years.
- Ecologists: Given the increasing focus on sustainability, recruiting Ecologists to join your oil & gas organisation’s green efforts is becoming a popular option. To help, we’ve put together this guide on attracting the best ecologists.
Talk to the Oil and Gas Recruitment Experts
As the oil and gas industry grapples with a skills shortage crisis, attracting and retaining top talent has never been more critical.
If you’re on the hunt for an expert Reservoir Engineer or simply looking to develop your organisation’s retention strategies, Patch Personnel is here to help. As oil and gas recruitment specialists based in Australia, our technical panel is well-versed in employers’ needs in the field and in matching you with top-tier talent. Get in touch with us today.