Some 10% of industry employees today were born since 1982, the average age of industry personnel is 49, and some 50% of geoscientists and petroleum engineers will be eligible for retirement within the next five years. This is according to a study by Deloitte Consulting LLP. "The gap between accelerated growth of upstream companies and available talent to do the work is widening at an alarming rate," says James R. Sowers, director, Deloitte Consulting human capital advisory services. "We already are seeing some companies turning away exploration and production projects for lack of available employees. If left unchanged over the longer term, this trend could significantly impact oil and gas production." The talent crisis is a result of an evolving build-up of several factors, including an aging workforce, cutbacks and layoffs due to industry M&A, and the industry's difficulty in drawing and keeping new, young talent, the firm reports. There were some 1,200 college graduates in related oil and gas majors in 1990 in the U.S.; by 2002, less than 292. Born-post-1982 prospective employees are sensitive to work environment, quality of life and purpose. It is critical that companies incorporate these values into their organizational culture, Sowers says. "Upstream companies seem to have an inability to effectively attract that age demographic into this booming industry that is rich with opportunities. Additionally, even when lured into the right degree programs, they don't sign on and stay for the same reasons as earlier generations." He suggests nonfinancial incentives that include active learning opportunities, an effective organizational environment and collaborative, interactive working styles. "Gen-Y needs to be engaged on their terms if we are going to attract and retain the talent that the industry needs."

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