Thanks to the profound emergence of natural gas, recent expansion projects within the petrochemical industry have stimulated massive growth and an abundance of job opportunities. Industry leaders recognize the urgency of preparing a well-trained, available workforce to fill those jobs, as well as providing the infrastructure to support that growth.
Marcus Pezent, plant manager and site director for BASF, touted his company's corporate workforce development group for doing "enormous work" in the Houston area. BASF engages with elementary schools, participates in science fairs, provides tutoring to students, and works "hand in hand" with San Jacinto and Lee colleges, University of Houston and other universities. "It's important to stimulate the young people early so that they have an interest in technical, science and engineering. If you don't do that, later on it may be too late," he said.
BASF has also provided 25 internships to promising students over the past 3-4 years, Pezent said, speaking on a panel moderated by Winkler Public Relations President Dennis Winkler at the Economic Alliance Houston Port Region's annual Gulf Coast Industry Forum held recently in Pasadena, Texas.
"Internships give us an opportunity to look at an employee for 6-9 months and then make a very intelligent decision about them as a long-term employee," he said. BASF has employed six of those 25 internship recipients.
Pezent noted more recruitment attention needs to be paid to "50 percent of the population" to further develop the workforce. Accordingly, BASF recently established a "Women in Manufacturing" group at Lee College.
"We are bringing in women who are technicians to talk to young people about the challenges and the opportunities of working in the technical and petrochemical industry," Pezent said.
BASF's Professional Development program also recruits from universities and places engineering students in nine-month rotations at different BASF sites to immerse them in different aspects of the engineering lifestyle, Pezent added.
"A P-Tech (process technician) student may not have ever been on a chemical manufacturing site," Pezent said. "We bring them on-site and let them see what they're getting into, talk to technicians about what they do every day and make sure that's what they want to do. The last thing you want to do is invest in an employee and then have them not be happy."
Pezent said BASF has also found success in recruiting military veterans to its workforce.
"We find those skill sets whether the military trains them or it's in a P-Tech type of environment," he said. "There's a whole group that's coming back that has been serving our nation, and they deserve a job when they get back."
©Kim Christensen
Lee College Economic Alliance event in Pasadena 2017
Lee College Economic Alliance event in Pasadena 2017 (Photos by ©Kim Christensen)
From left, Moderator Dennis Winkler of Winkler Public Relations, Rod Herrick of Covestro, Earl Shipp of The Dow Chemical Company, Marcus Pezent of BASF and Ron Corn of Chevron Phillips Chemical Co. LP discuss petrochemical opportunities. Photo credit: Economic Alliance Houston Port Region.
Abundant financial opportunities
Ron Corn, senior vice president of petrochemicals for Chevron Phillips Chemical Co. LP, said his company works with the East Harris County Manufacturers Association (EHCMA) to recruit "good, qualified people" to shore up the workforce.
"Our jobs are getting more and more technical and require more and more skills," Corn said. "Working with the junior colleges to turn out skilled workers is a very important issue."
Corn finds particular pleasure in working with eighth-graders who are involved in Junior Achievement, a leading student organization that promotes work-readiness, entrepreneurship and financial literacy skills.
"We talk to them at site fairs and other places about what their future holds," Corn said. "We try to encourage them that there are lots and lots of options and to think about what they like to do. Do they like to work with their hands? Do they like to work inside or outside? On computers? What inspires them?"
Corn then informs students of the dynamic opportunities available to them within the petrochemical industry.
"There are $100,000-a-year opportunities out there in their future if they set their minds to it," he said. "There shouldn't be a dialogue about minimum wage. We try to get them excited, to take some of the fear factor out of them."
Earl Shipp, vice president of The Dow Chemical Company's U.S. Gulf Coast Operations, said his company has begun an apprenticeship program for companies in Europe that takes "a more common approach" to getting people trained for careers in the petrochemical industry.
"You hire them first; then they're trained on the job and they transition into work," Shipp said. "The simple fact is there are people who could work in our industry, but getting the skills and the training to do that is a burden."
Shipp believes it is important to recognize that support and contractor companies have similar "people issues" to the petrochemical industry.
"I would suggest that may be one of the bigger threats we have to continuing growth within our industry," he said. "Does anybody have an abundance of electricians or pipefitters or welders? We don't, right? Those skilled trade [workers] are very rare at this point in time. It's not any single company issue; it's an industry issue, and we all better get on board. We can compete in the marketplace, but if we don't get this right, none of us will ever get to the marketplace."
Shipp noted it takes almost as long to train a welder as it does to train a chemical engineer.
"If we don't understand that part of our workforce, our ability to grow becomes compromised because, at some point, the availability and/or the cost of it reaches a point where it could start to impact the ability to do projects," Shipp said.
Shipp continued by observing the high cost of labor and the "broader picture" of needing a plentiful, well-trained workforce as the industry grows to replace retirees as they leave the workforce.
"If you do a billion-dollar project, roughly half of that money is labor," Shipp said. "So, if your labor to construct a new facility takes a 10-percent hit because of productivity or speed or because of a lack of available, qualified human power, then that's 10 percent of half a billion dollars. And there are some projects that are going to go underwater if you do that."
Building and maintaining infrastructure
Panelists agreed that, in addition to workforce development, infrastructure concerns are a top priority in the list of challenges to growth within the industry.
"What you've got to think about is the 'goes-into's' and 'goes-outta's,'" Rod Herrick, plant manager for Covestro, said. "We've not only got to bring our key raw materials into our sites, but we also have to have the transportation infrastructure to get our products out of the sites. That's always a challenge when you're looking at the multiple factors."
Covestro, Herrick said, brings in some of its key raw materials on barges along Cedar Bayou. "But a lot of times we have to park-load our barges before we bring them in," he said.
Herrick noted the devastation wrought by Hurricane Harvey accentuated infrastructure challenges, including damage to railroads and limited availability of overland drivers. He believes more attention should be paid to investment in flood prevention.
"I think that type of investment would have actually saved some of the flooding within some of our communities and some of our impacted employees and citizens," he said. "That type of investment, to me, is part of this whole infrastructure [issue] that needs to be looked at -- and not only at the local and state levels. Drive that up to the federal level to actually get that on the front burner so we can do something."
"We are, for the most part as an industry, on the southern to southeastern end of the fourth-largest city in the country, and every now and then there are a few traffic issues in and around Houston," Shipp said, jokingly adding, "OK, maybe more than a few."
Shipp noted Houston is geographically located about a day's truck drive from 35 percent of the U.S. population.
"In terms of serving markets and customers, it's a good place to be," Shipp said. "However, that doesn't work if your truck spends three or four hours just getting across the city because of traffic congestion. We know that's something that's an issue across the state, and we're going to have to work on that."
Shipp connected the challenge of traffic snarls to "air issues," a complication that persists despite industry successes in that area.
"Houston, Galveston and Brazoria County is a nonattainment area. A large part of that issue now is mobile sources; it's not us [in petrochemical] ," Shipp said. "In most of our industry, we make very significant investments in trying to do our part. But as the area continues to grow, it's still an issue. If we can solve at least some of the traffic congestion issues, that won't hurt the air issue."
"The infrastructure, pipelines and the storage caverns give us a huge competitive advantage over virtually everybody else in the world," Corn said. "As long as we are allowed to responsibly expand and safely and responsibly operate those facilities, and we can work with the governments on the logistics, we can all work together toward a very strong common good."
"Now is the time," Herrick concluded. "It's about all of us talking to our legislators to make that very important on their agenda. It's up to us, and now is the moment."
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