How bad is the skills gap?
The skills gap in the energy industry stems from two sources, creating a risk management crisis for human resources teams. Since the onset of the 2010s, the average age of energy professionals has been rising, in 2017 it is 59. Back in 2010, the estimated number of senior professionals expected to retire in the next five years was 22,000. While not all of these executives took their planned retirement, many have, leaving firms in a rapidly expanding field without replacements. This is the second source of strife in the industry: a lack of up and coming young professionals. Essentially it boils down to: too much demand and not enough hands on deck. In fields like wind and hydro the gap is more noticeable, with EU regulatory bodies putting in place incentivized programs to encourage more professionals to pursue hydro and wind career paths. If nothing is done to bring in droves of new professionals, and fast, the industry is left 48,000 engineers short by 2050, according to growth/demand studies.
A prolonged period of skills gap within any industry can pose problems for growth and safety. Risk management struggles during these periods to train and retain talent to maintain steady growth (or even continuous production).
Why is this happening? “The industry has a history of overlooking issues related to its talent needs; long-term strategic planning has not been the priority for many companies, and most short-term strategies have fallen short in solving the problem. This unintentional neglect has also left the oil and gas sectors a step behind other industries when it comes to attracting talented people in the millennial generation” (KPMG & Rigzone, 2015).
Early into 2017 the European Commission has launched a four million euro mission to boost cooperation in the maritime technologies sector, looking to bring more awareness to young professionals and even encourage those already in the field to develop further their knowledge base.
In 2014, Ernst & Young published Powering the UK, which highlighted the energy industry’s aging workforce. The report implicated retirement as a key contributor to employees leaving the field, with 27% of energy’s technical workforce expected to retire by 2024 and, of this, 80% are in positions that require a higher skillset.