Strategies for Overcoming the Energy Talent VoidCharles Swanson

Director, Ernst & Young Energy Center

Energy Industry Talent Void

Half of the current workforce will retire in the next 10 years

Half of today’s E&P workers are 50-60 years old

15% are early 20s to mid 30s

The average age in the O&G workforce is 48

• Oldest employee age in any U.S. industry

Shallow Talent Pool

Shortage of petroleum engineers

BS programs down 50% • 34 in 1983 to 17 in 2006

BS enrollment down 79%• 11,014 in 1983 to 2,412 in 2006

Degrees granted down 74%• 1,529 in 1983 to 393 in 2006

How did this happen?

Since 1985, energy firms have cut workforces by approximately 65%

Perceived instability

Tech industry boom

Layoffs in the mid-80s and the ripple effect

Image problem

Without Trained Workers

Loss of differentiating technical capabilities

Slow down in project delivery

Unable to develop shut in capacity

Increase in operating costs from errors (World Oil story)

Further tightening of production supply; increased volatility and price at the pump

What now?

Extreme Makeover

Image makeover focusing on:

Wealth of opportunity

Caliber of opportunity

Employer of choice

Wealth of Opportunity

Ample opportunity• Monster.com search for O&G returns more than 1,000 hits

– 850 petroleum and reservoir engineering– 520 geoscience

• 100% post-collegiate job placement

Generous salaries• Petroleum engineering starting salaries around $60,000

Global opportunities; opportunities for growth

Caliber of Opportunity

Challenge• Focus on the cutting-edge technology

Value• Opportunity to meet growing worldwide demand

Pride• Lose the roughneck image

Employer of Choice

Overall Industry Mature, stable Environmentally conscientious Profitable; investing wisely to increase

supply

Company Specific Exceptional benefits Growth opportunities

Short Term Strategies

Be creative; recruit from non-traditional sources

Start with a younger audience

Retain and retrain

Utilize consultants

Looking Forward

The word is out

Media coverage

Industry alignment• Cohesive messaging surrounding the issue• Increasingly aggressive recruitment

Movement afoot