A “retirement tsunami” is going to be a major problem in the oil industry of Canada. According to Graham Dodd, a principal at Mercer LLC, The “retirement tsunami” refers to the shortage of workers experienced by the country’s oil sector brought about by its aging workforce.
Dodd’s conclusions were drawn from the results of Mercer’s recent survey which illustrated that the “technical skills gap” was seen as a very serious issue by Canadian oil and gas firms. The data further showed that although more than half (56 percent) of these companies have put in place a process that is able to pinpoint the gaps, only 27 percent of them were able to give solutions to address these problems.
Apparently the shortage is taking place at the top levels of leadership. Fifty-five percent of the firms that participated in the survey said they were having problems hiring individuals that could take on management and leadership posts. The companies estimate that if these labor shortages are met, they could expect an increase of anywhere from 5 to 10 percent in their investment returns.
To address the current labor challenge, companies are poaching from each other. The survey showed that 70 percent of the new posts were filled by luring workers from other companies. Only 10 percent of new recruits were hired from colleges and universities. What makes the situation worse is that Canadian firms are also facing competition from firms in the US, Asia and Africa that are also looking for Canadian workers.
Incidentally, Canada’s oil sector is not the only one beset with labor shortages. The liquefied natural gas (LNG), mining and power industries are also in need of new workers.
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