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Oil & Gas…down but not out

Many companies have been forced to downsize following the fall in the price of crude oil. But organisations can’t afford to ignore their talent strategies.

​August 12, 2015

It’s no secret that as the low oil prices continue to plunge the industry into recession many companies are being forced to downsize operations. Inevitably, employees across the full oil & gas life cycle are experiencing the brunt of the industry’s downturn by the increased threat of redundancy and unemployment.

In a very short space of time the market has retracted and what was once a scarce talent pool is now increasingly saturated. During such a challenging period, the recruitment industry can play the vital role of mediator for employers and candidates. For employers, the decision to release workers is never an easy one to make; however, how employers go about this will have far reaching implications on their ability to retain & attract talent when the market changes.

Supporting employees during the transition

If history repeats itself, the market will return to growth and current trends of reducing graduate hires, young engineers changing jobs or career paths and an ageing workforce, will result in an even more acute skills gap. Of course, companies must achieve their bottom-line and if redundancies or termination of contracts are a must, employers should look at all possible options to help their employees. The career transition process could involve engaging an outplacement company or a trusted recruitment agency.

Outplacement companies are used when an employer decides to downsize and wishes to help employees transition into a new job/career. Services normally include employee counselling, career guidance, CV writing tips, interview preparation, developing networks, job search skills and effective methods to target the market. However, such services can be expensive. And for employers who want to do the right thing by their employees at a financially challenging time, this option may not be feasible. The second option is working with a recruitment agency who understands the company and its issues.

The recruitment industry’s role

After many years with the same company, long tenure professionals may find it daunting to be in the open market. Many started their career upon graduation and are now facing intense competition from peers for a shrinking number of roles. Recruitment agencies are responsible for offering the best possible service to help individuals return to the workforce as soon as possible. Impartial advice on best methods to approach the market, such as tailoring a CV to match a job specification in an increasingly competitive market is a good start. Agencies should also highlight market trends and which companies are hiring and in which locations. Plus, present a realistic account of salaries and rates to help set expectations.

Re-hiring ex employees: your brand does play a part

Re-hiring ex-employees may prove to be challenging, if an employer’s negative reputation eclipses the work it produces. Poor branding can also have an effect on the morale of current workers and will continue to damage the company long after the market turns. By then, many workers may think their future career lies elsewhere if they feel their former colleagues have been treated badly during the downturn. Also, disbanding teams overnight can further advocate a negative perception of a company. Of course if projects cannot be funded it is understood that some roles will be have to be discontinued. However, much consideration should be given to the years it can take to bring together such highly-niche experience and those who have taken the time to do so will naturally feel aggrieved.

Ultimately, no one knows how long the downturn in the oil and gas market will continue. Although companies and staff are going through turbulent times, there are ways to make the downsizing process much smoother. A strategy including the engagement of recruitment partners, clear communications and expected timescales can help maintain good relations with current workers and ex-employees who could possibly be re-hired when the market turns around.

In addition, for companies who can, now could be the best time to think about growing and upskilling their workforce. As talent is increasingly available, recruiting the next generation of managers through offering long-term performance related packages could secure your workforce for the future. Additionally, such packages will help to lower upfront costs and reward workers when profits increase.

If, as expected, the market rebounds and the talent shortage becomes more acute, companies are currently in a position to limit their exposure to some of these issues by being more transparent with the workers they already have. And these include the soon-to-be retiring baby boomers, whose impending departure will have an inevitable impact on the industry. Of which we will discuss in our next update.

Posted over 8 years ago

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