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Insight: Current demographics, and the current issue, in the oil & gas industry

Monday, April 14, 2014

What impact has almost 30 years of RIF-ing had on our industry?

What can we say about the current demographics?

What is the current big issue?

By far the most authoritative insight into oil & gas industry demographics is that produced by Schlumberger Business Consulting’s annual review of HR benchmark data gathered from 40 E&P companies (at least that was the 2012 number). SBC sometimes present this data at conferences, the most recent presentation being accessible here. Their data covers Petro-technical Professionals (PTPs): geoscientists (geologists, geophysicists, petrophysicists) and petroleum engineers (reservoir, drilling, completion, and production engineers).

To summarise their most recent findings, when the number of PTPs on a global basis is plotted as a percentage against the age bracket, their prediction for 2016 is that the peak will be at around 23% for the 25-29 age group, declining in pretty much wavy straight line fashion to around zero at 65. This is in complete contrast with the facts from 2005 where there was a secondary 13% peak for the 25-29 age group but a much bigger primary peak, at just over 20%, for the 45-49 age group.

SBC argue that, by 2016, there will be, on a global basis, roughly a 20% shortfall in experienced PTPs whilst the overall numbers will look OK.
This raises two questions:

1. Unless something is done, there is going to be a rapid near-term loss of skills and experience from the industry. Can anything be done to retain this generation that has (early) retirement on its mind? Or at least ensure that its knowledge is retained in the industry?

2. How can the younger generation more rapidly acquire the knowledge and absorb the experiences that others have, and be brought to earlier deep expertise?
So, in principle, if you are under 30 and have just entered, or are considering entering, the oil & gas industry as a PTP, you can look forward to your skills, knowledge and commitment being much in demand. With rewards to match.

And yet the lessons of the past should tell you that this industry is capricious, given to RIF-ing, given also to displaying what I might term the “Harry and Jack” syndrome.

Look after your own career still seems like sound advice!

Author: David Bamford
Company: Petromall


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