Help Wanted

We may not have yet reached Peak Oil, but we may have reached Peak Oil Workers:

Wanted: Oil workers

In the next three or four years, there’s expected to be a 30 to 40 percent shortage of technical and professional oil workers in the Untied States, according to Damon Beyer of Katzenbach Partners, a Houston-based management consultancy that specializes in the energy sector.

Over a quarter of the industry’s highly skilled employees – petroleum engineers, process engineers, geologists, geophysicists and the like – are eligible for retirement in two years, said Beyer.

Well, I won’t be eligible for retirement in 2 years, and I can see my job getting much more difficult. I already see this manpower shortage firsthand, because one of the things I have to do is secure manpower for my team. That consumes a disproportionate amount of my time, because there aren’t that many good people just floating about.

“It’s a real issue,” said Beyer. “Success in attracting new people into the work force is limited.”

Worldwide, the industry’s “people deficit” is expected to reach up to 15 percent by 2010, according to Pritesh Patel, an associate director at Cambridge Energy Research Associates.

Well, I know one way to address that supply deficit. If the pay for engineers, geologists, and geophysicists was in the ballpark of what energy analysts and hedge fund managers are paid (seven figures is not that unusual, which has certainly tempted me on occasion), I think the supply imbalance will start to swing the other direction.

13 thoughts on “Help Wanted”

  1. Don’t count on it — in our teevee dominated age, there are simply a lot more people capable of blathering as an “analyst” than there are of working as a process engineer.

  2. A frequently-quoted energy analyst like Fadel Gheit, who works for a brokerage house, even though he is consistently wrong, is almost certainly pulling in 7 figures. I have had several offers/inquiries in the mid-six figure range. Those kinds of numbers get your attention, but the location is never right. I am waiting for someone to offer me high 6 figures, and tell me I can live anywhere I want. Then, we shall have a deal. 🙂

  3. A young friend of the family has a master’s degree in biology, specializing in watershed restoration, and marginal chances for permanent employment. How long do you think it would take him to be retrained/reeducated for work in the oil industry?

  4. In my industry there is a constant stream of qualified Asians, and they are often hired. Is there a different dynamic in the oil world?

  5. I was surprised that in the latest publicity pages of Shell are not green and talking about how much they care about Earth, but it was a recruiting call for process engineers, suggesting that they are offering very good positions. The people shortage must be extreme. My suggestion: no retirement age.

  6. available people/skills for the energy business[oil especially] is mirrored by day rates for deep water drill drill capacity–almost no amount of $$$ will satisfy the need for some significant time.

    energy cos[especially oil] created the problem they’re in today. they established no upside plan[for people or equipment]. their current coffers of $$$ and recent stock buybacks could have been partially allocated/invested into upside business potential. was it? i canbe corrected if wrong.

    the writing was on the wall for the past 5 to 10 years[books have been published on the problem/exposure,some businesses got into wind and CSP in the 90’s, etc]–why did they invest the $$$, what was the basis for the books, where were the corp economists/analysts to assess the changing world environment and consider the upside?

    i significantly altered my investment options in ’04 to emphasize these things[ and i ain’t the brightest lite on the street].

    i think the following about BIG energy–

    1] asleep at the switch, or
    2] see/care only the long side $$$ benefit to them by– as is situation or wait for the smoke to clear to buy up those still standing[fossil and renewables].

    by BIG oil i mean NOC’s and private enterprise.

  7. I agree with the sentiments that technical and skilled workers are disasterously undervalued in US society, while lawyers, administrators, financiers and celebreties are overvalued.
    I am astonished everyday that a run-of-the-mill lawyer in Los Angeles now makes $400 an hour, while very good cabinet makers, woodworkers, plumbers, electricians make 1/4 to 1/8th of that…
    I hope petroleum engineers begin to command much higher salaries….
    RR–think about an high-end investor-industry website-analysis service…CERA must be making good money, and, as you point out, they seem a little out of touch with the geo-poli-oil realities out there…you would think tthey would have at least raised the issue of thug oil somewhere along the way…but they have not…
    don’t be too sure about Gheit’s wages…brokerage analysts at major wire houses did start to get multi-milion-dollar salalries back in the late 1990s, but things have gone poof since then….and Oppenheimer is big, but not big-big….

  8. I have suggested in the past that countries privatizing their oil development can extract the most economic rent. The NY Times seems to agree:

    So perhaps the best strategy for resource-rich countries is to keep the oil private, watch it carefully and tax the hell out of it. Better yet, raise royalties, which are more straightforward and easier to collect. “If your objective is to maximize rent, then the best way is to have companies compete with one another in open bidding for access,” Tissot says. “Angola and Libya have done this very successfully. Libya invited private companies to come back and is squeezing 90 percent of the profits out of them.”

  9. I don’t know how widely known it is but BP is currently trying to Squeeze employees out of the company. lots of “rationalising” going on, including within the Geophysics teams. 3 months ago they were a critically scarce resource and today BP is trying to drop 10 – 15% of them… go figure

  10. Hi. I´m David Pizarro
    A senior student of petroleum engineering in Colombia.

    I agree with you. right now the industry has a deficit, but how comes that if countries like U.S and U.K don´t ask for engineers from other countries, just offering to work there for their shift and then send them to their countries…i know alot of petroleum engineers that are earning less than 1500 dollars per month; that´s a salary of 18000 dollars per year. it´s not fair,and we have to do something about it

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