Opinion: resurgence of energy projects in Asia Pacific creating workforce challenges

New energy projects in the Asia Pacific are creating workforce challenges according to Calum Smith, Senior Vice President of Asia Pacific at HR consultancy, Airswift. In terms of roles, he says no other area in energy is growing as fast as renewables.

Airswift’s Calum Smith

As talk of new oil and gas projects and renewable energy commitments pepper the headlines, it’s clear that energy project activity in Asia-Pacific (APAC) is emerging from its recessional slumber.

How is this renewed optimism in the Asia Pacific impacting hiring and recruiting?

As it turns out, the same governments that are giving the green light to new projects are also slowing the influx of international talent.

For energy companies to thrive, cultivating and mobilising local talent is crucial.

Uphill for downstream

When a softening of upstream activity (extraction and production) began, there was a growth in the downstream (closer to end user) sector, and naturally, jobs here became more plentiful. That trend has continued and is gaining steam.

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Storage and delivery projects are also growing in size and scale. For example, Singapore is completing the construction of the world’s largest LNG storage tank.

The emphasis on downstream hiring extends across the oil and gas sector, with petrochemicals and refineries seeing workforce growth.

Lower commodity prices have led to increased investment in plant and facility upgrades.

‘In terms of roles, no other area in energy is growing as fast as renewables—and no other sub-sector is as appealing to energy workers.’

However, oil and gas companies are also focusing on efficient staffing models to decrease the overall cost of expanding downstream activity.

Another focus for downstream hiring has been to get the most from automation.

Digitalisation still has a way to go in the oil and gas industry, but it’s apparent that operational best practices are firmly in the crosshairs.

Our recent 2018 Global Energy Talent Index (GETI), actually revealed that 64 per cent of oil and gas professionals stated that digitalisation within the sector brought increased efficiency.

Momentum

Governments and corporations in the Asia Pacific are doubling down on clean energy, pouring more resources particularly into renewable projects.

According to consultants Ernst & Young, the region attracted nearly half of the world’s renewable energy investment capital in 2016.

In terms of roles, no other area in energy is growing as fast as renewables—and no other sub-sector is as appealing to energy workers.

The GETI report also revealed that renewables was the sub-sector of choice for anyone in energy looking to jump across the industry.

That’s not to say that filling out the workforce is straightforward. The talent pool for highly-skilled technical roles on wind and solar projects is limited.

This is going to be a candidate-driven market for the foreseeable future and companies will have to adjust their recruitment strategies accordingly.

We see a similar story playing out in infrastructure and mining, where recovery and investment is translating into a rise in projects—and a pressing need for technical skill sets.

Localisation

To fill highly-skilled technical roles, companies are still leaning on expat talent.

But local governments want companies to source more of their workforce locally and are enacting tougher immigration policies to ensure it happens.

In this context, localisation efforts will need to be ramped up to prevent any skills gap from widening and to remain on solid footing with local authorities.

Crucially, by investing in local people and economies, companies also generate their social license to operate, without which the atmosphere can at times turn hostile.

Tactics

For a localisation strategy to succeed, there are three distinct tactics that companies will have to take on.

The first will be to expand the depth of local talent networks. Companies will need to find ways to widen their local candidate pool. Here, partnering with a firm with strong local connections will be crucial.

‘The pay-off for a dedicated localisation strategy is vast.’

Secondly, organisations will also have to create a local content strategy for recruitment and development.

Though localisation is a cross-regional trend, each country has its own unique set of regulations and requirements.

Companies will need to find the expertise to become intimate with each country’s policies, understand the differences across the region and figure out when it makes the most sense to develop locally or hire from abroad.

Finally, it will be crucial for companies to develop and enhance local engagement programmes to better connect with young candidates.

Local graduate schemes are critical and companies that are relatively new to a country will have to work fast to build connections with local universities. Training and development programmes will also have to be robust and attuned to the local environment.

The pay-off for a dedicated localisation strategy is vast. ExxonMobil’s success in developing a highly-localised and competent workforce for its PNG LNG project is testament to this.

This well-developed local content strategy also generates a social license to operate, which reaps other business benefits.

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