Connex Alumni

Volcanic Ash Aside, Engineers See Bright Skies Ahead

With many industries still subdued, and fears of a double dip recession hanging over us like the volcanic ash from Iceland’s Eyjafjallajokul, AWS finds that talent managers are looking to their alumni for support.  The oil and gas industry are scouring the market for technical talent, with many recruiters finding that experienced technical professionals can ‘write their own tickets’ as the market regains strength. In fact, experienced professionals in the oil and gas industry tell us they have weathered the economic downturn better than most.

“Companies are contacting us again with great interest in finding their former employees. There is renewed priority on preparing for the upcoming skills gap. In addition, companies downsized, but are now finding new opportunities and some of the people who were let go will be well positioned to fill these new opportunities,” shares Cathy Clonts, President of AWS, which hosts a number of corporate alumni networks.

Energy Demand On the Rise
With worldwide energy demand on the rise despite the hurting economy, the industry can’t afford to wait for economists’ all clear. The International Energy Agency expects global oil demand to hit a record high in 2010. The Paris-based adviser to industrialized economies raised its forecast to 1.67 million barrels per day (bpd), up 100,000 bpd. In its Oil Market Report, the agency stated that world oil demand would reach an average of 86.60 million bpd this year—up from 84.93. "There are signs of oil demand picking up in North America and the Pacific, Asia and the Middle East, although consumption in Europe still looks weak," David Fyfe, head of the IEA's Oil Industry and Markets Division, told Reuters.2

Industry giant ExxonMobil expects overall worldwide energy demand to increase by almost 35% (2005 to 2030), despite the economic downturn. ExxonMobil expects this increase to be driven by a growing worldwide population and economic growth, particularly in developing countries. 3

Mergers and acquisitions activity in the oil and gas sector is at its highest level since records began, providing a rare bright spot for dealmakers as deal flow in other sectors remains subdued.

At a recent energy conference in Houston, Texas, ConocoPhillips CEO James Mulva commented that the world will be depending on fossil fuels for decades to come and that experienced and new entrants to the industry see bright skies ahead.4

A Glamour Industry Again
The industry provides opportunity for all experience levels, explains Clonts. “Once again, our alumni communities return value supporting hiring of new entrants to the industry. Experienced professionals understand the company and its culture and are valued ambassadors encouraging their children, relatives and contacts in their local community to consider a career in the energy industry.”

Young hires are looking at starting salaries as high as $80,000 USD a year plus signing bonuses and equity stakes. And HR professionals are reaching out to former employees and bringing them back in numbers as they recognize the costs of people who already know the company and culture offer significant value. Recruiters also recognize the value of experienced hires helping to ramp up the skills of newer entrants.

HR executives also find they are increasingly sourcing talent from their websites and through word of mouth referrals.

Anil Chopra, CEO of PetroTel in Dallas called a contact that had retired and convinced him to come back to work. Shares Larry Morse, “We were comfortably retired in East Texas, but Anil’s request that I come to work for him has suited my wife and I. I work in the Plano office and we have an apartment close to our son and his family. It is ideal.”

Contek Solutions Jim Johnstone concurs, “Jim Collins is one of several ARCO alumni who work about six months a year for us. They don’t want or need to work full time and their expertise enables them to work on a project basis. Jim was able to put his grand-daughter through med school by working for us. “I find it interesting that my business partner was at Nortel and he doesn’t have a network like ARCO. Not only do we hire people through the ARCO network, but many of our clients were at ARCO.”

Johnstone uses creative hiring strategies for all experience levels. “As a small company we can tailor compensation to the person. I was at a client’s office and he was on the phone with a summer hire. The civil engineer worked for them for two summers and was ready for a full time position, but the client had no openings. Once again our network came through. The young man had several offers and chose to work with us at Contek as he felt the opportunities for advancement were better. We tie pay to the business we bring in. We also have two safety grads we hired who are making more money than they imagined possible.”

A Pool of Experienced Talent
People are one of a company’s few assets that grow in value over time, yet many exit with no formal process for keeping in touch. Just as company needs change over time, former employees change as well. Many former employees find themselves willing to come back to work at a later time — either full-time or short-term. To tap into this pool of experienced workers, many companies have discovered the value of online alumni networks. “I believe the most successful recruiting method is through individual networks,” DeScioli says.

AWS works with a number of Fortune 500 companies to develop online alumni communities. Companies use these sites as a strategic recruiting tool for attracting former employees for training, mentoring and long- and short-term assignments around the globe.

Companies also find that former employees are valuable referring potential job candidates. A former employee is in a great position to find a well-suited hire since they understand the culture and priorities of their former company.

Companies keep in touch with former employees by keeping them up-to-date on the company and its opportunities around the globe. Online alumni networks keep individuals connected, driving home the message that although they left the company, the former employee is a valuable part of its talent pool.

Online networks allow companies to track a former employee’s career growth, and changing aspirations and priorities over time. An employer can use the online network to find experienced talent by searching key criteria like technical discipline, years of experience and mobility preferences. Unlike general searches on Monster.com, Linked In and other online networks, which are populated mostly by entry-level talent, corporate alumni communities target experienced talent—an essential advantage in an industry facing an upcoming workforce shortage.

While the economic waters may still be murky, rising energy demand is forcing the oil and gas industry back into the waters. The good news in the energy sector is that companies are willing to commit to young talent and also embrace former employees. The objective of companies is to prepare to wade back into the waters with strong, steady talent.

Sources:
1.Sewell Chan and Louise Story. “Recession Arbiters, Wary of Certifying an Upturn.” The New York Times, Posted April 11, 2010, http://www.nytimes.com..
2.Christopher Johnson. “World oil demand to hit record high this year: IEA.” Reuters, Posted April 13, 2010.
3.ExxonMobil. “Global energy demand.” ExxonMobil Web site, http://www.exxonmobil.com/Corporate/energy_issues_energydemand.aspx.
4.Jim Mulva. Natural Gas – The Gift Remarks. CERA Conference, March 9, 2010. Read the full speech at http://www.scribd.com/doc/28101350/CERA-Speech-Jim-Mulva..
5.Society for Human Resource Management. “Post-Downturn Staffing Strategies.” Workplace Visions, April 2010.
6.Press Release. “U.S. Job Satisfaction at Lowest Level in Two Decades. The Conference Board, Posted January 5, 2010, http://www.conference-board.org.
7.Tony Pugh. “Tight Job Market is Squeezing Out Young Workers.” McClatchy Newspapers. Posted Wednesday, March 24, 2010, www.mcclatchydc.com.