Why hiring more skilled workers might be the next challenge for the oilpatch

CBC Wed., March 24, 2021


With forecasts for better crude prices and more activity in the Canadian oilpatch, there’s talk of an old challenge rearing its head again: recruiting skilled workers. (Todd Korol/Reuters - image credit)

With more than two decades working in oil and gas, Chad Miller says the business is in his blood.

So while the last few years have been a roller-coaster for oilpatch employment, the pipefitter from Sylvan Lake, Alta., has stuck with it.

""It's a hard industry," said Miller, 40, who is currently working on the Trans Mountain pipeline expansion project.

"But [there's] something about it. If you love it, you can never get away from it."

Still, he doesn't blame those who've walked away.

"People have left the industry because of the crash in 2015 and the uncertainty of what's been going on," he said. "They chose different professions and a lot of them won't come back."

Trying to get them to return could be the next key hurdle for the oilpatch.

Carol Howes with PetroLMI, which studies the oil and gas industry's labour market, expects net hiring in oil and gas services to be about 13,000 jobs from 2021-2023. It anticipates 6,900 positions to open up in exploration and production.(Robson Fletcher/CBC)

Amid expectations of strengthening crude prices and more activity in the oil and gas sector, there's talk of an old challenge rearing its head again: recruiting skilled workers.

The long-running downturn has weighed heavily on the industry, leading to spending cuts, layoffs and a migration of workers out of the oil and gas sector.

Now, a new report is forecasting better days, with modest job growth in the oilpatch beginning next year. Two key sub-sectors are expected to make some of the largest gains.

PetroLMI's latest forecast predicts net hiring in oil and gas services to be about 13,000 jobs from 2021-2023. It anticipates 6,900 positions to open up in exploration and production.

It expects the growth to be driven by liquefied natural gas development, improving commodity prices and some stabilization from the federal government's injection of $1.7 billion into a program to clean up inactive oil and gas wells.

But finding the workers with the skills the sector needs may prove a tough task.

Mark Scholz, head of the Canadian Association of Oilwell Drilling Contractors, is encouraged by what he's seen in the first months of the year — improved oil and gas prices, vaccine rollouts and the hope of surging fuel demand as the pandemic abates.(CBC)

"We've never had the stretch of downturn that we've had over the last five to six years," Carol Howes, vice-president of PetroLMI, said in an interview.

"This has been a very long stretch of layoffs and uncertainty, coupled with other factors like COVID, it has really just discouraged many people, unfortunately, from looking at the industry the way they would have in years past."

Howes also said the challenge is also about hiring workers with the right skills.

"A rig hand has to have very different skills now than they might have years ago," she said.

"It's not a labour shortage as much as it is a skills shortage, a skills gap. So it's also addressing the skills. And that's true, not even just in the services sector, but the other sectors as well."

Mark Scholz, president of the Canadian Association of Oilwell Drilling Contractors, said his members experienced the challenge of getting workers beginning late last year.

"So it has already begun," Scholz said in an interview.

Scholz said there are a number of factors at play, including the tough times that the sector has had to endure.

"It has created an environment where a lot of our employees left the industry because the industry became much smaller," Scholz said. "So as we ramp up, those employees that we used to rely on as a complement of our labour force are no longer there anymore."

Scholz is encouraged by what he's seen in the first months of the year — improved oil and gas prices, COVID-19 vaccine rollouts and the hope of surging fuel demand as the pandemic abates.

But he thinks people are looking for some certainty for a prolonged recovery in order to come back to the sector.

"If the industry can show that, in fact, this is a sustained recovery and this isn't a temporary blip, I think that that will potentially help with those recruiting elements," Scholz said.

"In the end, if you increase somebody's wage by five, 10, 15 per cent, even at an elevated pay scale, if you can't guarantee long-term work, it means nothing."