Oil & Gas Workforce Shifts Along with Energy Transition

Author photo: Gaven Simon
ByGaven Simon
Industry Trends

The energy transition is a multilayered process that is continually demanding progress in technology, government, work expertise, and economics. To rapidly deploy renewable energy across the United States, the transition requires workers at every level from boots on the ground to executive suite employees. One of the more interesting developments in the energy transition is the multitude of professional opportunities presented to the oil and gas workforce, who are finding their skill sets readily applicable (and desired) in renewable energy growth markets. What is prompting a mass exodus of oil & gas employees? What are the external and internal pressures causing oil & gas companies to lay off people? How is green energy playing a role in this?  

A Look at Green Energy Job Growth 

    Before the pandemic, 11.5 million people were employed globally in the renewable energy sector. Over the last three years the oil and gas industry has been letting go of a substantial percentage of its employees. Layoffs due to capital discipline, automation of operations, mergers & acquisitions, and lowering cost structure. In the United States, the oil and gas industry lost around 107,000 jobs between March and August 2020 (according to data from the U.S. Bureau of Labor Statistics). The World Energy Outlook report concluded that the COVID-19 crisis caused a reduction of around 2.3 million jobs in the oil and gas sector. Most recently in 2022, it was reported that the oil and gas industry had 700k fewer workers than six years ago, a 20% decline. Places that historically attracted oil companies for decades have witnessed a rapid Energy Transitiondecline in oil-related jobs. Houston, for example; reported a decline of 26% in oil-related jobs from 2014- 2020. In a rapid turn of events, individuals who may have been previously employed by the oil & gas industry are now on the hunt for new job opportunities. Many are transitioning to the green energy space.  

Despite the oil & gas industry facing workforce complications, the sector will undoubtedly still be prosperous, in demand, and provide good jobs for years to come... It is important to note the oil and gas industry is not disappearing overnight. The green energy transition, currently, does not have the bandwidth to supply the energy that is being demanded, plain and simple. While the green energy industry may be booming so is the oil and gas. Last year, five of the west's largest energy companies – Exxon Mobil, BP, Shell, TotalEnergies and Chevron – have reported nearly $200 billion in 2022 profits combined. 

   Particularly in the United States, the oil & gas industry took a hit during the pandemic, other parts of the energy industry prospered. The U.S. Energy and Employment Report USEER analysis shows that the energy sector experienced positive job growth, increasing 4.0% from 2020 to 2021, outpacing overall U.S. employment, which climbed 2.8% in the same period. Overall, the total number of energy jobs increased, from 7.5 million in 2020 to more than 7.8 million in 2021. There are more than 3 million jobs, 40% of total energy jobs, that support reducing U.S. emissions to zero across several sectors. Globally, renewable energy job growth jumped from 12 million to 12.7 million by the end of 2021. With Asia accounting for 2/3 of the total renewable energy jobs with China representing 42% of the grand total.  

The U.S Energy and Employment Report also included outstanding job growth in these sectors:  

  • Electric vehicle jobs increased by 26.2%, adding 21,961 new jobs. 

  • Hybrid electric vehicle jobs increased 19.7%, adding 23,577 new jobs. 

  • Solar energy jobs increased by 5.4%, adding 17,212 new jobs. 

  • Wind energy jobs increased by 2.9%, adding 3,347 new jobs. 

  • Energy efficiency jobs increased by 2.7%, adding 57,741 new jobs. 

  • Transmission, distribution, and storage jobs increased by 1.9%, adding 22,779 new jobs. 

Clean energy was a significant source of job growth in many states. The three states with the highest energy job growth numbers overall were Michigan, California, and Texas. 

  • Michigan gained 35,463 net jobs, which includes 5,136 new jobs in low or zero-carbon motor vehicles. 

  • Texas gained 30,903 net jobs, which includes 4,858 new jobs in low or zero-carbon motor vehicles, 6,771 new jobs in energy efficiency, and 1,610 new jobs in solar.  

  • California gained 29,429 energy jobs, which includes 11,050 new jobs in low or zero-carbon motor vehicles, 5,949 new jobs in energy efficiency, and 1,994 new jobs in solar. 

 Battles Are Brewing for Energy Expertise 

   Almost all major utilities, renewable energy groups, and oil & gas companies have set out strategies to achieve net-zero emissions. These advantageous goals are great for the environment but are making the search for certain skills and experiences hard for companies trying to recruit new talent. One of the biggest challenges facing the job market today is human capital. Adding to the pressure, President Biden’s Bipartisan Infrastructure Law provides significant investments in clean energy infrastructure, including $62 billion for DOE (Department of Energy) to expand access to energy efficiency; deliver reliable, clean, and affordable power to more Americans.  

    Today, the public and private sector are now both providing large investments in the clean energy sector. Without the proper workforce expertise, the investments and plans will struggle to leave the drawing board. Putting reputation aside, oil & gas employees are beginning to be re consider their future in the hydrocarbon sector. A survey of 17,000 global energy industry companies, recruiters, and employees found that 56% of employees working in oil and gas wanted to transition to a career in renewables.51% of individuals working in the renewable energy sector have shifted into the industry in the last year. It is not about if it is about when, traditional oil and gas roles have immense transferable skills that green energy companies are currently in dire need of. Some of the most important transferable skills needed today include engineering, technicians, construction, finance, and project management.  

    There is an immense number of accessible resources that can teach applicants how to properly title and highlight these sought out skills. A positive result of the public and private sectors contributing an immense amount of funds to renewable energy is the increased number of higher paying quality jobs. This renewed flow of investment is currently breaking down the misperceptions around green jobs, such as their lower salaries. Even in instances where pay is not yet equal, the gap is rapidly closing simply out of necessity.  

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