Canada's oil industry is booming, but companies in its top oil-producing province, Alberta, are struggling to hire and retain skilled talent to seize the opportunity of greater market access that the expanded Trans Mountain oil pipeline provides.
Canadian oil production is rising and could rise by the most among all producers this year, analysts say.
But a shortage of talent could make Canada's renewed oil boom more difficult to sustain.
As Boomers and Generation X are retiring, the next generations of the workforce – Millennials and Gen Z – are looking at the oil and gas industry as a dirty thing from the past, wrecking the climate and not worth their attention as job seekers.
Rising Demand for Talent
The University of Calgary in Alberta, where most Canadian energy companies are based, has recently heard from industry contacts that firms are struggling with staffing skilled positions. And the university now plans to restart its oil and gas engineering program, which was suspended three years ago due to very low interest and a downturn in the industry during COVID.
"Some of our industry contacts and industry partners have been telling us increasingly over the recent months and years that they are having trouble finding qualified engineers to hire into the energy industry," Anders Nygren, vice-dean of the Schulich School of Engineering at the University of Calgary, told The Canadian Press' Amanda Stephenson in an interview last week.
The University of Calgary suspended in the summer of 2021 admission for its oil and gas engineering bachelor program due to plummeting demand as only 10 students had registered for the course in the two years prior to the suspension.
The university didn't abandon oil and gas-related studies – it continues to offer petroleum-specific specializations within the fields of mechanical and chemical engineering. Currently, there are about 1,800 students enrolled in these programs, Nygren told The Canadian Press.
The decision to revive the oil and gas engineering program is indicative of the talent crunch the industry has faced in recent years, but also of an uptick in interest in petroleum-related courses, following years of younger generations thinking of the sector as the villain in the fight for curbing climate change.
Following the energy crisis of 2022, energy security has become more prominent among companies and consumers as many started to realize that the world will continue to use oil and gas for decades and the energy transition is not happening overnight.
Changing Workforce
Moreover, the rise of AI and digitalization in the oil and gas industry has shifted the perception that the sector is offering only blue-collar jobs where the young people would get their hands dirty and contribute to rising global emissions.
Yet, while these two factors may have attracted some of the young generation to work in the energy sector, the cyclical boom-and-bust nature of the industry is putting off many others, and so are the working hours and a relative lack of the work-life balance that Gen Z crave.
Jobs in the oil and gas industry are well-paid in Canada and elsewhere, but the next generation of talent is looking for well-paid jobs in other fields. For example, data centers are poaching computing, engineering, and data science specialists from the oil patch.
An executive at an exploration and production (E&P) firm commented in one of Dallas Fed's energy surveys last year,
"Labor is hard to find. Dirty-fossil-fuels stigma drives younger talent away."
Some of the U.S. talent who are not driven away by the "dirty business" stigma are being poached by technology firms, data centers, Tesla, SpaceX, and other jobs in computing and engineering. This leaves fewer workers available for the oil and gas industry, driving up labor costs and overall project costs, potentially setting the stage for project delays.
Yet, according to Tristan Goodman, president of industry group the Explorers and Producers Association of Canada, the "bad narrative" that has driven talent away from pursuing university degrees in oil and gas studies has started to change.
"Of course, we need to continue to reduce greenhouse gas emissions, but at the same time, this is a product that everybody in the world is using. And I think a bit more pragmatism around that is entering the system now," Goodman told The Canadian Press.
Canadian industry associations are looking to promote jobs in the sector with new initiatives.
For example, Canadian energy services association Enserva launched in March its THINK Energy campaign, a national awareness strategy to showcase lucrative careers available within the energy services sector.
According to Enserva, formerly Petroleum Services Association of Canada, its newly-launched Working Energy portal will address talent shortages.
"There is currently a 3,000-4,000-person labour shortage in the energy services sector that is made up of labourers, drivers, tradespeople and more, and Enserva is hoping to connect those looking for jobs with companies who need positions filled and create a long-term solution to this shortage," Enserva CEO Gurpreet Lail said.
"Our sector also has to address this ridiculous idea that Canadian energy is a dying industry. That's simply not the case," Lail notes.
"The world is going to need our energy for a very long time, and we need talented people to help us innovate and produce it responsibly."
By Tsvetana Paraskova for Oilprice.com