Addressing The Skills Gap In The Energy Sector

Key Factors and Contributors/Drivers

The energy sector is at the tipping point, with the energy transition being a core focus globally and the demand for energy continuing to rise. The role energy has in society is the largest it has ever been. However, for a sector to function, grow, and meet demand the talent and skills required must be present.

A shortage of new skilled workers added to an ageing workforce who are looking to retire in the coming years poses a serious threat to the energy sector. One of the drivers behind this is a lack of younger talent having the ability and experience to grow into middle and upper management roles that are being left by the ageing workforce. This is resulting in a huge hole of knowledge, experience, and advice that is being missed and left behind. With no stream of talent to take the roles in time, the experienced professionals that are retiring from the industry are unable to share and pass on their vast wealth of skills, understanding, and general knowledge to the new younger workforce.
The innovation and digitisation taking place create a balancing act situation to the matter.

Digitisation has meant many older employees who are potentially more senior need more training around new technology than the younger ‘tech-savvy’ employees which is a gap that needs closing. But as mentioned above younger employees; due to a lack of management skills cannot develop into management positions. Together they create a skills gap in seniority and form a generational skills difference – senior employees have the hard market knowledge and skills but not the technical skills to fit the digitising world and it is vice versa for junior employees.

An ageing workforce, lack of training and education, and a digitalising sector together are creating a skills gap being experienced across the world. 56% of recruiters state the ageing workforce is the biggest contributor to the skills gap and 40% believe insufficient education and training is the leading factor. The skills gap can be overcome with the implementation of the correct solutions and the optimisation of opportunities that are available to the energy sector.

Opportunities and Solutions

Not all is lost for the energy sector. There are solutions to bridge the skills gap in the energy sector and opportunities to build a strong skilled workforce. The first solution starts at school ages. Science, Technology, Engineering, and Mathematics (STEM) has a huge misconception of being an unstable career choice – which is wrong. STEM careers should be encouraged and promoted far more than they currently are. In 2019, only 23.5% of 11-19 year olds had heard of engineering careers from career advisors. Not only do STEM careers offer a huge amount of career potential and growth, but many STEM roles are also the innovators of our future, solving real-world challenges, and developing a better world. This should be promoted much more by Governments and Energy businesses to attract young people into STEM careers.

Another meaningful solution that can help bridge the skills gap is for energy companies to construct and develop training and digital learning plans and schemes. This would mean each individual can develop the skills they require and at the pace they can. A digital classroom would allow for many companies to grow current employees’ skills to fill the empty roles as well as bring in the younger talent and help them to gain the experience they require. This is a brilliant solution to closing the skills gap, but currently, not enough companies have a rigorous L&D programme in place, meaning the loss of skills continues and the new talent required is not available.

The next development to help close the skills gap is upskilling immediately. The energy sector is undergoing change at great speed. The skills required for the workforce in 10 years’ time is an unknown. McKinsey research shows by 2030, 14.5% of the global workforce will need to adapt their skillsets to account for the change. Upskilling will develop more skilled talent with cross-functional skills that can be applied across various industries within the energy sector and is a great way to bridge the gap and ensure a stable future for the energy market.

Furthermore, as global development continues and many undeveloped countries are becoming emerging economies and more developed, many opportunities for new market expansion and the use of new talent is becoming available. Nations such as Brazil, Indonesia, and South Africa are just some of the new emerging energy markets that present huge opportunities for energy companies globally to expand their operations but also uncover new talent in previously unused markets.

Workforce extension through a Managed Service Provided (MSP) or third-party recruiter is another excellent way for energy companies to bridge specific skills gaps within their organisations for specific teams and projects. Contractors can be outsourced from an MSP and they provide the ideal candidates for the role and allows the energy company to get the experience and skills that they need on-demand. However, it may be argued that contracting consistently is not a permanent solution for energy companies and it should be done alongside the development of L&D programmes and other methods to grow internal talent and skills.

Closing statement/considerations

Although the current skills gap that the energy sector faces can be a scary thought and has short term issues that it rises. There are solutions to the matter and energy companies and governments are actively working to help bridge the skills gap, but there is a lot more to do. Not only is the bridging of the skills gap important for workforce sustainability, but it also has a role for net-zero sustainability. The sector has a responsibility to nurture, develop, and ensure the correct talent and skills are available for a successful energy transition.

Sanjay/Amar Statement – “The skills gap in the energy sector is a challenge for companies, however, it can be resolved. I believe that a combination of implementing the necessary steps, processes, and actions together can bridge the skills gap.

The energy sector is a rapidly evolving space undergoing constant changes. If we are able to attract younger people into the sector, form quality L&D systems, and utilise emerging market opportunities globally, the skills gap can be closed and a stable supply of highly-skilled talent will be available throughout the energy sector. However, it is not an overnight fix and will take time and investment from companies and governments around the world.

Energy keeps society functioning and is a cornerstone of civilisation, in addition to being at the crossroads in the energy transition. It is a requirement that we close this skills gap in the energy sector, not only for the sake of the energy transition but for the whole of society.”