For the next 19 years, 10,000 baby boomers will turn 65 every single day. Many of these boomers will be retiring, or at least switching to a less demanding career. That trend is a real worry for many companies, as this means there will be a need to replace a large percentage of the most skilled, experienced, and knowledgeable portion of the workforce. However, with every great challenge is an equally great opportunity. In this case, the opportunity is ripe for future job seekers.
The Great Crew Change
One industry where this trend is most apparent is the energy industry, where the average age of its workforce is about 50 years old. Some suggest that as much as half of the industry's workforce will be retiring within the next decade, in what some are calling The Great Crew Change. That alone will create a lot of job openings. However, it doesn't even factor in the continued growth in hiring that the U.S. oil and gas industry is also expected to experience over the next decade.
Since the end of the Great Recession, the energy industry has experienced an employment surge of 41% thanks to the fracking boom. The industry supports now 2.1 million jobs, and the boom is far from over, with some projections suggesting that the industry will create another million or more jobs by the end of the decade. That growth, along with the surge in industry retirements is a challenge for employers but a major future opportunity for job seekers.
The greatest needs
While the energy industry needs a variety of skills, the two most pressing are engineers and geologists. As many as 40% of the globe's petroleum engineers are expected to retire in the coming decade. While the industry has been preparing for this eventuality, that isn't expected to stop it from affecting companies this year. A survey by oilfield service giant Schlumberger (NYSE:SLB) estimated that by this year, the industry would see a net loss of 5,000 experienced geoscientists and petroleum engineers as a result of retirements. That's proving to be true, as the number of job openings for the North American oil and gas industry currently exceeds the number of qualified applicants, according to consulting firm Deloitte.
These issues have only been heightened by the fact that the fracking boom is fueling growth that few, even inside the industry, ever expected to see. We're seeing companies return home to the U.S. after spending decades focused on pursuing oil and natural gas overseas. Apache (NYSE:APA), for example, pursued international expansion from the late 1990s until recently. Now the company is turning its focus on North American onshore production growth.
The company sees its North American resource potential being four times its current total reserves as it drills more wells in places like the Permian Basin. The change is dramatic. In just three years, the company has grown its investment in that one basin sixfold. The company went from drilling around 250 wells in a year to more than 800. Further, it currently has more than 34,500 future drilling locations. That's just one basin at one company. Apache alone has at least as much growth at its central U.S. operations.
The problem for Apache and others will be to acquire the skilled professionals like geoscientists and engineers to ensure that these wells are drilled in an efficient and environmentally responsible manner, while also ensuring that these wells capture the maximum amount of oil and gas. That is a great challenge in and of itself. However, it's compounded by the fact that the industry's top talent is retiring and there doesn't appear to be enough up-and-coming talent to fill the those jobs, let alone all of the jobs that the industry is expected to create by the end of the decade. That, however, is a great opportunity for future job seekers who are willing to gain the education and skills needed to take on this challenge.