As much of the energy sector’s seasoned workforce becomes retirement eligible, an impending demographic crisis could impede the industry’s growth, leaving many executives in search of strategic and innovative ways to bridge the subsequent experience gap.

“We need to attract and harness the right talent. All too often our industry is portrayed as low tech, out of date and part of the problem rather than being a part of the solution,” Saudi Aramco Chief Executive Kalid Al-Falih said during a keynote address at the recent IHS CERAWeek conference in Houston. “Indeed, many people see us as a sunset industry. This is deeply concerning as well as highly deceiving.”

With more than 30 years since the sector’s last employment push and a lull in hiring activity in between, the industry is on the verge of losing more than 50% of its experienced workforce during the next three to five years. According to a 2011 Schlumberger human resources survey, there is an expected outflow of 22,000 key petrotechnical professionals from the beginning of 2012 to 2015 due to retire. Before Al-Falih’s address, a panel of industry executives gathered at the conference to discuss the steps their companies are taking to address the “big crew change.”

“This is a global phenomenon. It is affecting most industrial and technology businesses including the E&P business, and the skill shortage complicates things,” said James Tastard, human resources director for Statoil Inc.’s North American operations. “There are forecasts of core technical and leadership positions going out of the industry, and it is especially noticeable when you look at the age of the baby boomers.”

As projects grow more complex and faster paced, the competition for talent increases; it becomes imperative for oil and gas firms to retain and harness key personnel. But unearthing talent with a high level of expertise is difficult during this precarious time, Tastard said. New Bureau of Labor Statistics data show that employment in science, technology, engineering and mathematics (STEM) occupations is expected to expand faster than employment in non-STEM occupations from 2010 to 2020. And, as demand for qualified STEM workers increases, there is a smaller percentage of students pursuing post-secondary STEM degrees.

“It’s not a people shortage, we have people throughout the world—young, talented and ambitious people; they just don’t have the qualifications and or the education,” Tastard said. “Ageism is a global problem; this is a global structural employment problem. We are faced with a young, inexperienced workforce with limited or no STEM education and a high demand for blue-collar skilled trades.

“The new generation is a different generation. They are highly ambitious, highly motivated, they work hard. They just work and learn differently,” he said. What does Statoil do to combat this problem? According to Tastard, it focuses on and works toward diversity. According to Schlumberger’s 2011 Human Resources survey, 27% of petrotechnical professionals in highproduction growth companies are female. But, according to the report, only 14% of engineers are women, and just 27% of individuals working in computer science and math positions are female. At Statoil, 40% of the board of directors are women, and the future of the business lies in the diversity of gender, Tastard said.

“Thirty percent of all leadership positions globally are female. And, when you look at the graduating classes in the U.S., Canada and Norway in life sciences, females make up 50% or higher,” he said. “We [the oil and gas industry] need to focus on how we inspire and become role models in the classroom.”

Tastard recommends companies make significant investments in STEM programs. Students without a strong elementary and secondary math and science education are unprepared to train for careers in the STEM field, according to a report by a U.S. Congress Joint Economic Committee, STEM Education: Preparing for the Jobs of the Future. And this, the report said, can lead to a shortage of STEM professionals.

“Science and technology curriculums are often thin in K- 12 education and may not be enough to provide students with a solid foundation in STEM upon which to build,” the report said.

“It is challenging to attract and retain STEM-trained individuals to teach STEM subjects at the K-12 level. … While the quality of math and science teaching is the greatest factor in improving student achievement in STEM fields, not enough K-12 math and science teachers have hands-on experience working in STEM.”

Many teachers, the report said, lack the necessary background to teach STEM programs. According to the National Science Foundation, 36% of middle school science teachers and 30% of middle school math teachers lack STEM-field training. The industry needs to get involved, Tastard said. He said that companies can partner with educational institutions to develop the learning programs that can build the petrochemical and leadership skills that are much desired within the industry.

“We can bring programs into the classroom, we can bring real life excitement into the classroom,” said Tastard. “However we cannot replace the elementary-to-post-graduate experience. We need to support it, we need do our part, and we need to work as an industry.”

Along with breaking down educational barriers, mentoring programs are another avenue companies can take to address the STEM participation and achievement gap.

“Having a mentor significantly influences students’ decisions to pursue STEM degrees and occupations, especially for women and minorities,” said the U.S. Joint Congress STEM Education report.

“Further, those with more opportunities to engage in STEM-related activities, such as science fairs, projects and clubs, are more likely to go onto STEM careers and have accomplishments in STEM fields.”

Both ConocoPhillips and TalismanEnergy Inc. sponsor and support a breadth of mentoring and knowledge sharing programs. ConocoPhillips has flourishing mentoring and internship programs, while Talisman has developed its own in-house mentoring program for high-potential employees.

Both companies, along with Statoil, have found that mentoring not only benefits the student but participating veteran employees welcome the chance to share the wealth of knowledge they have developed over time.

“We find the most experienced employees want to share what they know with the next generation,” said Sheila Feldman, vice president, human resources, ConocoPhillips.

“Our interns tell us that it is one of the most vital parts of their internship experience.”

The crew change is a serious challenge many in the industry are facing today. With fewer STEM graduates and increased competition for talent, the time has come for those in the oil and gas industry to step up and make an investment in the future, Saudi Aramco’s Al-Falih said.

“We need to spark the imagination of young people and show them the high-tech, complex and exciting opportunities our industry has to offer,” he said. “We also need to develop and articulate the societal contributions we constantly make. In other words, we should never stop investing in people, no matter where they are.”

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