A new report suggests that over 40,000 new people will need to be recruited into the UK oil and gas industry over the next 20 years, including 10,000 for roles that do not yet exist as the industry continues to evolve.
The UKCS Workforce Dynamics Review was carried out by OPITO in partnership with Robert Gordon University’s Oil and Gas Institute and assessed the evolving nature of the oil and gas industry in the UK.
The Changing Face of Oil & Gas
The report finds that while the total workforce is set to fall by 2035 – around 80,000 workers are expected to leave the sector due to retirement or other reasons – the changing nature of the industry will require anywhere up to 10,000 to be recruited to fill roles in data analytics, data science, robotics and remote operations.
The future of these roles, however, depends on the industry’s ability to meet the ambitions laid out in Vision 2035 as well as its carbon transition plans.
The oil and gas sector has placed a particular focus on its digital transformation and at Digit’s Digital Energy Conference on the 1st and 2nd of May, speakers showcased an industry going through immense change – innovation, technology and data are now critical to long-term success.
Part of the digital transformation process will require a great emphasis placed on retraining and investment in the current workforce to adapt to the changing nature of the industry, as well as attracting innovative and highly skilled future workers.
The UKCS report reflects the theme at Digital Energy 2018, recommending that closer collaboration is required between industry and training providers to up-skill and retrain the workforce to enhance technological capability across the sector and still compete with other sectors.
Additionally, the report suggests that a new skills strategy and approach to training will be required to ensure that the industry can still attract talent in the future.
Colette Cohen, Chief Executive Officer of the Oil & Gas Technology Centre believes that digitisation is revolutionising the oil and gas industry and workforce, creating exciting opportunities in years to come. She said: “The world is rapidly changing, driven by a digital revolution, ever-increasing connectivity and a fundamental energy transition to a lower carbon economy. Automation and digitisation are transforming our jobs, our workforce and our relationship with work.
“This is creating exciting opportunities for how we use technology to improve both our industry’s performance and our country’s productivity.”
According to the report, the new skills strategy is likely to include the development of new training programmes and courses; involving input from employers, trade unions, government, educational institutions and training organisations.
It recommends that to capitalise on this transitional period in the industry, common standards across the energy sectors will be required to create a more flexible and dynamic workforce.
Professor Paul de Leeuw, Director of the RGU Oil and Gas Institute, said: “Technology, innovation and the transition to a lower carbon future will re-shape the sector.
“With over 40,000 people potentially entering the industry over the next 20 years and with a substantial proportion of the workforce to be up-skilled, there is a critical role for training providers, vocational institutes and universities to help future-proof the sector and to ensure the UK retains its’ reputation as a leading energy basin.”
John McDonald, CEO of OPITO echoed Mr de Leeuw’s statement, saying: “As the industry emerges from the downturn, it is crucial that we take a longer term look at the future of UK oil and gas skills requirements. A new skills strategy will help us to take action now to prepare for emerging roles and ensure the existing workforce is being given opportunities to upskill.”
There are an estimated 20 billion barrels of remaining hydrocarbons to be recovered, however the process of extracting these will becoming increasingly challenging in the coming years. In order to maximise economic recovery and provide a clear-cut vision for the future of the oil and gas sector, the Oil and Gas Authority, in collaboration with Oil and Gas UK created a new vision for the industry.
This lays out the industry vision to produce an additional three billion barrels of oil and gas by 2035 and to double the UK’s share of the oil and gas supply chain market in the global scene. This will take the UK industry’s global share of production from 3.7% to over 7%.
Adapting to the Downturn
Following the downturn between 2014 and 2017, the oil and gas industry in the UK lost over 70,000 direct and indirect jobs, a decline rate of around 10% per year. The UKCS report suggests that if the industry can achieve the goals around Vision 2035 and its energy diversification policies then it could sustain over 130,000 roles in 2035 – The 2017 workforce level stood at around 170,000.
This equates to a decline of less than 1.5% per year and shows that given the industry meets its targets, it can still retain its position as a significant global market.
John McDonald said: “Whilst total employment will fall over the next two decades, this will be a more gradual process than the sharp hit experienced over the last three years. If the industry can work together to achieve ambitions around production and energy diversification, tens of thousands more roles can be safeguarded and our industry will continue to be one of the key sectors in the UK for years to come.”