Watching the World Oil industry risks skills shortage

With David Knott from London With technology advancing so rapidly and outsourcing becoming common in areas once the preserve of oil companies, the industry is increasingly reliant on contractor skills. Training is one of the ways of keeping pace with technological change. But conflicting attitudes of oil companies and their contractors toward training could lead to a skills famine. This is the fear of the Engineering Construction Industry Training Board (Ecitb), Kings Langley, U.K., which

May 20, 1996

3 min read

With David Knott
from London

With technology advancing so rapidly and outsourcing becoming common in areas once the preserve of oil companies, the industry is increasingly reliant on contractor skills.

Training is one of the ways of keeping pace with technological change. But conflicting attitudes of oil companies and their contractors toward training could lead to a skills famine.

This is the fear of the Engineering Construction Industry Training Board (Ecitb), Kings Langley, U.K., which manages funding of training in the U.K. construction industry.

Peter Griffiths, director and chief executive of Ecitb, said without the board there would be little training done by companies.

Ecitb's role

One of Ecitb's duties is organization of the construction industry's apprentice scheme. Griffiths said Ecitb is the main source of qualified craftsmen and women in the offshore fabrication and plant construction sectors.

The board trains school dropouts as well as graduates. It organizes "high flyer" management training programs for future project managers. It also helps experienced workers learn new trades.

Another role is to keep management and workers up to date on new technologies. Here "lifetime education" is needed because in many areas-welding, for example-techniques advance year by year.

To meet this need, Ecitb has developed a unit-based training system made up of more than 300 units.

But there are problems in the construction industry that militate against systematic training, and training is in danger of being ignored as relationships between oil companies and contractors shift.

Griffiths said, "This industry hires and fires staff on a regular basis, so it has a nomadic workforce.

"One problem is that training programs often take longer than the trainee's current project. Another is that there is no apparent need for continual training of adults as far as contractors are concerned because they can easily get 'off-the-shelf' labor at the moment. But a crunch point could be ahead."

Griffiths said the average age of the contractors' workforce is increasing. For example, the age profile of riggers is said to peak between 50 and 55 years, while for pipefitters the peak is just below 50 years.

"This shows what might happen if the industry does not train enough new people in the next few years and there is an upturn in the industry," Griffiths said.

Brain drain

There may be a worse problem, says Nigel Bowden, Ecitb manager of training operations. He sees a risk in oil companies' unwillingness to pay for training as part of projects.

"Self-employed staff do not update their skills," Bowden said. "They are too busy chasing work. At a typical contractor's head office, 30-70% of staff will be self-employed.

"Another issue is that oil companies have got rid of engineering skills, and there are now lots of consultancies made up of ex-engineering personnel of oil companies.

"Innovation now tends to be within small consultancies, not the majors. This may in the long term benefit oil company shareholders but not the companies."