With the inherent complexity of the petrochemical infrastructure, the need for skilled professionals is more crucial than ever to ensure safety in construction and operations.
And the industry certainly isn't blind to the connection between safety and a skilled, tenured workforce. According to a recent survey conducted by USG Corp. and the U.S. Chamber of Commerce, 58 percent of organizations reported that workers with insufficient skills are increasing safety risks.
So it comes as no surprise that the skilled labor gap across the energy sector is a growing concern, driving the industry to reevaluate its risk management practices. If workforce development isn't a critical focus area for your organization, it may be time to consider the cost of not investing in training, recruiting and retention efforts.
Conservative estimates reveal losing an entry-level employee may cost $7,500 or more, while the loss of a more tenured employee or specialist may cost upward of $30,000.
These estimates do not include the cost of temporary labor to fill the gaps, loss of productivity and opportunity costs, making the annual cost of turnover even higher.
When members of your workforce leave, they take their years of skills and knowledge with them. This is especially true for employees who have worked their way up through your organization. Furthermore, technology is accelerating at a faster pace than human development across the board. Manual processes are being replaced, and today's workers must be trained in a wide range of advanced skills.
Talent loss is starting to hit operations hard. According to the Interstate Oil and Gas Compact Commission, the average age of industry employees is between 46 and 49, and the average age for retirement in the petrochemical industry is only 55.
Many operators are now rapidly having to adopt one or all of the following strategies to rectify the looming skills gap: enticing industry veterans to stay in their jobs past retirement age, targeting recruiting efforts toward high school and college students through vocational programs and community or technical college reimbursement, and recruiting talent from outside the industry.
Despite all these tactics, replenishing the workforce brings its share of challenges to the petrochemical sector, primarily when it comes to attracting millennials.
Overcoming the industry's image with this generation is a significant hurdle. A recent Accenture report that surveyed millennials found the petrochemical industry to be the top sector in which people would not want to work solely because of its image. Additionally, the study found millennials believe the sector lacks innovation, agility, creativity and opportunities to engage in meaningful work.
Young workers need to be convinced this is an industry with a future -- an industry worth joining. But getting that message across is a horse of a different color, as evidenced by failed marketing tactics like the American Petroleum Institute's (API's) "This ain't your daddy's oil" campaign in 2017.
Generation Z could be the next great solution to the skills gap concern. Studies indicate Gen Z's are foregoing college degrees in favor of getting jobs with growth potential, making on-the-job training attractive. This generation is looking to work their way up in an organization. Heavy-hitters in the petrochemical sector are taking notice and investing in vocational programs at the high school level as well as college tuition reimbursement to attract these future workers.
For an industry that's certainly proven resilient time and time again, there's a light at the end of the tunnel and actions every operation can take. The skills gap issue isn't going to fix itself. Working together and sharing best practices for recruiting and retention are critical to operational safety today and our workforce needs tomorrow.
For more information, call Camille Curry-Theis at (832) 459-0055 or email her at Camille@MahaffeyUSA.com.
