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Balancing industry downturn with hiring needs

Posted by Jim Fearon, Hays VP, on Friday, Oct 23, 2015

small picture of man in hardhatThe recent fall in global oil prices is challenging industry employers to reduce costs while still having the right skills in place to deliver projects. What can other industries learn from Oil and Gas employers about balancing competing needs and creating and maintaining a sustainable workforce?

Skills shortages were again the biggest concern for Oil and Gas employers (30%) although economic instability was a close second (24%). While potential layoffs could lessen the skills shortage locally, there will continue to be shortages for experienced talent within in-demand skill areas, such as subsea, petroleum engineering and increasingly LNG.

"Projects with attractive economics are likely to continue, but new projects will come under increased scrutiny and, if no longer economically viable under the new oil price regime, could be postponed or cancelled," says John Faraguna, Managing Director, Hays Oil & Gas. “However, teams managing day-to-day operations still require the resources necessary to complete projects on time and within budget. At the other end of the spectrum, smaller businesses are responding to recent changes by focusing on interim hiring, shifting from multi-year contracts to short-term specialist assignments.”

Learning from past mistakes to help sustain the future of the workforce.

With hiring plans impacted, employers are faced with difficult decisions: how to reduce costs while still having the right skills to deliver projects. Furthermore, a decrease in hiring is likely to exacerbate the skills gap and could result in further skills shortages in the future. This year’s survey revealed 22.5% of respondents worldwide are aged 50 and above, which means that a significant portion of the tenured, skilled workforce will be retiring over the next 5+ years. With the anticipated reduced hiring of Gen Y workers due to market conditions, the future generation of industry leaders, the industry may be creating a future skills gap issue, much like it did in the mid-to-late 1980’s.

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