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Oil and gas industry employers are facing significant skills shortages, with half planning to increase headcount further this year, according to the Oil & Gas Global Salary Guide from recruitment firm Hays.
The Guide, which is based on data from 24,000 respondents, also shows that skills shortages are the primary challenge for 40% of employers. As a result, hiring plans will exacerbate the already skills-short market and add pressure to increase salaries in order to attract the top candidates.
The Guide reveals that in Australia the number of employees receiving additional benefits declined by -5% year-on-year, although benefits still play a key role in hiring and the most common three benefits are valued by employees at approximately 10% of their annual remuneration.
According to the findings, 28% of employees are offered bonuses, 24% pension plans and 11% have health care schemes included in their salary package.
Although salaries in Australia decreased slightly last year, employers’ confidence in the market is high, as 49.3% of hiring managers have a positive or very positive outlook for the oil and gas industry. Expectations in the coming year are that key specialist skills will be in demand and sourcing strategies will be critical.
The Guide, produced by recruiting experts Hays Oil & Gas in conjunction with leading jobsite Oil and Gas Job Search, shows local average salaries have increased by +0.1%, whereas salaries for imported talent have decreased by -4.1% compared to the previous year, resulting in the overall decline in average salaries of -2.3%.
Paula Kirwan, Director of Hays Oil & Gas, commented: “Labour prices in Australia remain the highest globally. The anticipated future cost-to-profit returns are causing operators to show increased caution in spending. Employers are looking to exhaust local candidate resources before considering sponsorship.”
For comparison, the industry globally has seen a decline of -1% in salary levels from 2013. The slight reduction in salary growth can also be attributed to a market correction after a particularly buoyant two year period of increases within the industry. This is probably a necessary correction after two consecutive years of salary growth have started to threaten the financial performance of some companies.
John Faraguna, Global Managing Director of Hays Oil & Gas, added: “Globally, salaries may have dropped slightly last year in line with the industry but what is important to note is that we are finding that confidence is steady to the industry and that demand for skilled workers continues to rise. However, one of the main issues threatening to upset confidence is the lack of skilled workers available to employers.”
“More women and young people made up the respondents of the survey compared to last year, which is an indicator of the make-up the industry, and a very positive sign. It’s important that employers tackle the skill shortages by training these younger workers and putting in place succession plans before the older workers exit the industry along with their years of experience,” Mr Faraguna concluded.