Skills are largely remaining within the oil and gas sector; however, renewables are emerging as an attractive destination for some professionals
Greener energy portfolios could boost talent retention in this evolving energy landscape. Amidst an industry-wide AI revolution, the sector’s older workforce trails behind newer sectors in AI adoption. Boosting employee buy-in will involve harnessing automation to free up time for other priorities and upskilling workers in AI-related fields.
Amidst falling fossil fuel prices, rapid recent salary growth has begun to flatten out. 4 per cent more professionals report a pay rise this year (48 per cent), significantly below the 13 per cent increase in salary rises last year.
Hiring managers have a more positive outlook compared to professionals, with 62 per cent reporting pay increases compared with 54 per cent in 2023. Pay optimism has improved since last year, with 69 per cent of professionals expecting a rise, up from 66 per cent last year. Hiring managers mirror this positive sentiment, with 72 per cent also anticipating pay rises.
Janette Marx, CEO of Airswift, said: “Salary growth is less steep as oil and gas prices fall from last year’s record highs, but pay everywhere is still rising in line with inflation. Previously large swings in salary are being replaced by stable growth based on a solid foundation of long-term projects.”
With an international pipeline of new projects, 83 per cent would consider relocating, compared with 81 per cent in 2023, and 61 per cent of firms now offer overseas transfers, up four per cent from last year. Europe has fallen from 29 to 26 per cent among most desirable destinations, while the Middle East is second on 23 per cent, and North America has fallen out of the top three behind Asia (15 per cent).
Career progression (50 per cent) remains the primary driver for foreign transfers, followed by lifestyle, low cost of living, and remuneration (12 per cent and 9 per cent, respectively) as the cost of living continues to increase. Proximity to family remains the most significant barrier for 34 per cent of those resistant to relocation, but 20 per cent say their employer does not offer relocation opportunities, indicating that levels of mobility could be influenced by opportunity.
Attracting and retaining talent
87 per cent would consider switching jobs, but most (61 per cent) would stay in oil and gas. Among the 40 per cent that would go elsewhere in the industry, the burgeoning renewables sector is the most popular (50 per cent). This could be linked to ESG being the third biggest driver for career movers. Another 29 per cent would move downstream to petrochemicals.
Job switchers are chiefly motivated by opportunities for career progression and interest in the wider industry. For engineers, flexible ways of working and technology are important factors.
Marx observes: “The findings indicate the battle for oil and gas skills will be fought on home turf with skills mostly circulating within the sector. Yet with an ambitious, mobile, and ESGconscious workforce increasingly attracted to renewables, employers will need to consider offering promotions and opportunities to lead sustainable innovations.”
Oil and gas skills are in demand from within and beyond the sector, with a slight increase in the number of workers headhunted for another job (81 per cent) and 12 per cent approached over 16 times since last year. Nine percent of engineers have been approached more than 21 times.
A quarter of respondents say that 26 to 50 per cent of all approaches came from an outside industry or expertise, yet this is not being reciprocated with only 19 per cent considering joining another industry. Just 26 per cent of these would move to the technology industry, the second lowest proportion of any sector. The tendency of prospective job-switchers in the industry to prioritise factors other than access to innovative tools, such as AI, points to a technologically traditional workforce.
AI in the workplace
Similarly, oil and gas is the least advanced sector when it comes to AI adoption. Just 24 per cent use AI in their role, the lowest of all the sectors surveyed. Perhaps relatedly, oil and gas has the lowest proportion of workers under 35.
A third of employers have an AI policy, yet the sector lags behind others on policy awareness. Nineteen per cent are unsure if their workplace has an AI policy, the highest proportion in the industry. With cyber security and lack of training leading to misuse or poor adoption later cited among top three AI risks, this indicates that inadequate policy awareness could expose oil and gas firms to cyber risks or poor practices.
Current AI policies are seeking to address this with a focus on the benefits and/or objectives of using AI (58 per cent) and maintaining data protection, integrity, and security (52 per cent).
Ian Langley, Chairman of Airswift, says “As a mature sector with significant skills and sunk costs in traditional technologies, AI uptake will be slower than newer, nimbler sectors such as renewables. AI could help power the latest technologies from carbon capture usage and storage to green hydrogen, but these are still nascent and attract a small share of investment.”
Popular AI choices
In further evidence of a technologically conservative workforce, individual AI tools are also the least popular among oil and gas workers. Machine learning and/or generative AI, such as ChatGPT, are the most popular at 15 per cent each followed by Artificial General Intelligence (12 per cent), far lower than other sectors.
Langley notes: “With unique hazards such as dangerous chemicals, high pressure/temperature systems etc. oil and gas prioritises safety and worker wellbeing. Given that many areas of oil and gas field development still require human intervention fully automated platforms are rare. In the future AI will play a major part in enabling lower carbon oil and gas production and optimising systems for carbon capture.”
As with petrochemicals, the sector primarily uses AI for immediate needs such as safety and inspection (23 per cent) and automated workflow and collaboration (23 per cent each) over strategic forward-thinking applications such as innovating with new products and services.
The future of AI
Lack of clarity on which tools best fit the company is the biggest barrier to AI adoption, followed by insufficient investment or employee support. Respondents are among the least positive about the future impact of AI, with 47 per cent very optimistic, the lowest of any, apart from the adjacent petrochemicals sector.
However, 58 per cent believe AI could create career progression opportunities and improve job satisfaction. Around half also believe AI could lead to more time spent on soft skills or with family and friends.
Marx observes: “Firms could harness automation to free up time for soft skills and strategic tasks that go towards promotions, boosting positivity about automation. AI also offers an opportunity to improve work/life balance, helping attract more women with families in a sector with just 11 per cent female representation in our survey.”
Conversely, a third (33 per cent) say AI could either hurt career progress or negatively impact salaries. Sixty-two per cent believe it will increase pressure on them to learn new skills and with the sector also having the oldest workforce, this could partly explain insufficient employee support for automation.
Professionals believe AI could have a series of positive impacts on the sector over the next two years from boosting research and development (28 per cent) to optimising production, services and/or solutions (27 per cent).
Yet this is significantly outweighed by concerns over risks AI could pose. Forty per cent fear a lack of human or personal touch, 32 per cent worry about inadequate training leading to misuse or poor adoption and 28 per cent cite increased cyber security risks.
Ken Corriveau, Chief Information Officer, Omnicom Media Group says: “This is an opportunity to allay fears and upskill workers for new roles by democratising digital skills to augment rather than replace humans. For example, previously you needed engineers who understood coding, now you can tell open-source AI what you want, and it will code snippets for you to put together. This will democratise AI innovation and require both soft and technical skills.”
AI skills for the future
Ninety-four per cent expect AI to increase demand for skills with the most sought-after skills corresponding to some of the biggest anticipated risks. Cyber security is joint third most in-demand along with data science (24 per cent). Programming/software engineering and IT (27 and 26 per cent, respectively) are projected to come top of employers’ wish lists.
Yet training priorities appear misaligned with skills needs. IT and cyber security rank low among skills that professionals are most interested in developing (eighth and ninth, respectively) despite being in the top three most in-demand. This indicates that firms may face skills shortages in these areas.
Machine learning is the top priority for upskilling followed by data science, programming and software engineering, and data visualisation skills. In line with the earlier finding that AI could free up more time for soft skills, employees are also interested in developing skills such as creative/ innovative thinking and critical thinking/problems solving (both 21 per cent).
Langley observes: “Increasing adoption will create ‘AI skills gaps’ in areas from prompt engineering to robotics maintenance, forging new job opportunities. Marrying training with in-demand skills will help bridge the gap between human and machine, reducing the risks from adoption and ensuring AI compliments rather than conflicts with human skills.”