As the exploration and production (E&P) industry continues to face the challenges of the collapse in oil prices and the disruptions it has wrought, one long-awaited milestone has passed almost unnoticed. For all practical purposes, the “big crew change” has happened. In the global E&P professional workforce, the high concentration of individuals in mid- to late-career stage has all but disappeared.
The proverbial hump in the workforce age distribution, which resulted from waves of retirements after the last major price collapse in the mid-1980s and a long subsequent period of low hiring, has been on the industry’s radar for at least 2 decades.
Concern arose in the late 1990s, as the workforce reflected a preponderance of experienced professionals ages roughly 40 to 50 and a dearth of younger individuals ready to replace them when they retired. The industry used the term “big crew change” to characterize the demographic challenge and began to prepare, focusing on new technology and other innovations in training resources that could smooth the transition.
Change Clearly Evident
Visually, the crew change is clearly evident in the accompanying age-distribution graph of SPE professional membership, a close proxy for global E&P professional employment. In a comparison of 2006 and 2016 membership by age, the 2006 curve displays an obvious hump in the mid-40s to mid-50s ages with a peak age between 45 and 49.
The 2016 curve displays a smaller hump in the late-20s and 30s age range, with a peak age between 30 and 34, and a modest decline into the mid-40s range. Additionally, the number of professionals in the 55–59 group has barely declined from the 2006 curve, when they were 45 to 49. This suggests that individuals who have left companies are remaining in the industry, whether working as consultants or making job transitions.
From 2006 to 2014, the crew change continued to proceed gradually, with the industry tracking the change and focusing on technology innovations in learning and training that could more rapidly prepare younger professionals and new hires for larger responsibilities. But when oil prices began a precipitous downfall in late 2014, a steady outflow of older professionals became a wave as job losses and retirements multiplied over the following 2 years.
Far Fewer Gray Heads
In her March JPT column, 2017 SPE President Janeen Judah wrote: “The ‘big crew change’ has happened. We’ve been talking about it for years and, in my view, it is mostly over. People who, like me, came into the oil industry during the boom years of the late 1970s and early 1980s retired in droves over the past 2 years. I see it when I talk to companies, when I walk around the halls at Chevron, and when I walk around downtown Houston at lunch—there are far fewer gray heads in our business.”
“Management may think that the aged 55-plus workforce will come back in an upturn,” she continued. “I disagree. They’ve been through five downturns and worked especially hard over the past 10 years of frenzied activity. They are enjoying their time off, and nearly everyone I have talked to has no desire to return to full-time employment. A minority is interested in part-time or project work, but only on their own terms.”
However, if the crew change has happened, the experience of the past 2 years delivered anything but the steady, efficient transition—with all the learning and training goals achieved—that the industry had envisioned.
“If it takes no time to train anybody, then the crew change is over, but I don’t believe that’s the case personally,” said Ford Brett, CEO of PetroSkills, a major provider of competency-based training for the industry. “We’ve finished the head count, so we have to make sure we finish the head content. The first one is easy, the second one is hard.”
Brett, a past SPE Technical Director for Drilling and Completions, believes it takes 3 to 8 years for a company to turn a new employee into a petroleum professional.
Roles for Consultants
However, companies also have significant opportunities to look outside their own ranks to fill knowledge and experience gaps and develop expertise within their organizations.
“In some cases, they are turning to independent consultants to provide peer reviews, knowledge transfer, mentoring, coaching, and quality assurance,” said Susan Howes, vice president of engineering at Subsurface Consultants and Associates. “This is often the case when the project team does not include members who have experience in executing a specific type of project—perhaps due to the ‘big crew change.’ ”
Consultants experienced with similar technology on analog fields “can share lessons learned and best practices that may save the project team time and resources,” said Howes, who is a former SPE Regional Director for Gulf Coast North America and past chair of the SPE Soft Skills Committee.
Today’s Tools
The industry has embraced and expanded the use of learning-, competency-, and knowledge-management tools to enhance and expedite training. Employees in their 20s and early 30s are the most digitally savvy members of the workforce and an ideal fit for learning and training programs that incorporate all variety of online tools. Thus, there is sound reason for believing that learning and training can proceed with greater speed and efficiency.
“I think the time to competency is lower than it was in the past,” Brett said. “But there are different things in the way the industry has worked that lead to different competency gaps. You still have to have a real piece of hardware, a real thing. Because if you’re with a pump somewhere, it’s really going to have to work. So there are hardware experiences that people used to have a lot more of.”
Nonetheless, while competency gaps remain, “you don’t have to be 50 to do this work,” he said. “I don’t think we have to worry about the industry being at risk from a bunch of kids that don’t know what they’re talking about. I mean I can only imagine what people were talking about when I was 26.”
Blended Learning
While online programs and self-directed learning are understandably playing a major role in workforce development, they may not meet every need. “I think the most effective tool is blended learning,” said Birol Dindoruk, principal technical expert and team leader in international reservoir engineering at Shell and SPE Technical Director for Management and Information. “Some individuals do very well using Internet tools, but others do better with face-to-face learning. Probably we need to strike a balance between various methods, while the weighting will depend on the subject and the intended depth to be acquired.”
An adjunct faculty member at the University of Houston and a consulting professor at Stanford University, Dindoruk said, “When people do web training, you don’t know who’s doing what at the other end, and as a matter of fact, some people are multitasking. So the focus element isn’t always there with some of these newer tools. So how do you design the tools and programs in a way that will keep people on their toes?
“Current tools tend to have more standard questions for assessment,” he continued. “But in real life, we don’t have structured questions like that. And you’ve often got to ask questions to figure out what problem you need to address.”
Ideally, learning from online tools should be “reinforced by participation in classes, workshops, conferences, mentoring relationships, peer reviews, business simulations, and on-the-job application of the newly gained skills,” said Howes. “These face-to-face opportunities to build relationships and exchange ideas enhance the critical thinking skills for professionals to enable them to solve industry’s most challenging problems.”
More Age Balance
While periodic upheavals have been a feature, not a bug, in the industry workforce over the long term, the current age distribution is more balanced than in the decade following the mid-1980s price collapse. As was true then, professionals in their late 20s to late 30s are the largest segment of the workforce. “But this is less of a peak than in the past; in 1994 it was bigger,” Brett said.
He also notes a slight increase in the 55 to 60 age group in the current workforce, which he expects will disappear with retirements in the next 5 years. One other development in today’s age distribution is the relative decrease in employees in the 40 to 50 range.
“If you happen to be 40, there is a lot of opportunity for you because the line is short now,” Brett said.
Great Advances
Mohab Kassem, senior human resources development manager in learning and development at Halliburton, believes the great advances in online learning and training tools can offset at least much of the impact that the departure of the most-experienced professionals has had on the workforce. “We have evolved on the systems side tremendously,” he said, citing the development and enhancement of learning- and competency-management systems.
In the earlier phase of the crew change, “we worked with learning-management systems, but what you could do with them was very limited in scope,” Kassem said. “And the concept of competency-management systems was barely starting.”
While online learning and competency systems existed or were created, “they were not evolved up to the level where you could apply them and make sure you were having a very effective knowledge capture and transfer,” he said. That has changed with the advances in these systems and the industry’s increased reliance on them, although Kassem believes there is scope to better leverage some of the additional systems in these areas.
There are also SPE resources available. The SPE Competency Management Tool is a free online member benefit that allows members to assess their current professional capabilities. Online knowledge repositories, such as SPE’s PetroWiki and the OnePetro library of technical papers, can provide members with “just in time” answers to technical questions.
Capturing Knowledge
In addition to enhancing learning and ensuring competency, there has been a focus at Halliburton and other companies on capturing the experiential knowledge of senior professionals before they leave the company workforce. “That experience has been captured through [online] knowledge portals and communities that we’ve been using since the early 2000s,” Kassem said.
Looking ahead, challenges remain in the learning and training areas, with the large number of professionals who have left the industry in the past 3 years.
“Whenever activity picks up, I think there will be potential for rehiring some of them,” Kassem said. “The challenge for us will be how we can fit them back into the industry in the shortest time possible and in the most economical way. We will have to be extremely selective in the training and development we provide.”
Microlearning
“We talk all the time about ‘microlearning’, the smaller chunks of training,” he continued. “But have we really done all we can do in this space? Probably not.”
Shorter bursts of training—typically using online resources and mainly provided on an as-needed basis—are likely to become the norm throughout the workforce, with lengthier formal training programs the exception. “This is what really makes sense for the younger generations and also what will make sense from a business perspective; the challenge however, will be making sure that every employee has access to that learning right when they need it,” Kassem said.
“Efficiency and cost control can be achieved by planning and coordination for professional learning, training, and competency-building for the skill pool,” said Howes. “Functional leaders should annually assess the highest priority gaps in workforce competency in alignment with the goals of the department and the business unit.”
Howes also noted that many options for affordable continuing education, forums, symposiums, and conferences are available through SPE. “Writing a technical paper for an SPE conference,” she said, “can be an excellent learning experience to develop both technical and communication skills.”