The future energy leader: a millennial dilemma

Keywords: energy transition, future pipeline of talent, generation Z, graduate employment, millennials, oil and gas workforce, recruitment, retention, talent pipeline, workforce transition.

The oil and gas industry has been undergoing a cataclysmic cultural shift – no company is immune to its effects. Generation Z (Gen Z), currently in the 9–24 age group, and Millennials, currently aged 25–40, tend to consider oil and gas ‘the fuel source of their parents’ (EY 2017). In fact, in a survey recently conducted by consulting firm EY, 39% of Gen Z respondents considered a career in oil and gas to be ‘very unappealing’ with two out of three teenagers believing that the oil and gas industry causes more problems than it solves (EY 2017). On its own, the lack of approval from younger generations may not seem a significant issue to many senior executives in the industry, however this problem cannot be viewed in isolation. Oil and gas organisations tend to be highly selective in their recruiting practices and prefer high-calibre diverse candidates from top-tier universities – who will often have competitive offers from a plethora of other industries. This industry also has the bulk of their jobs based in certain locations within Australia and there can be an unwillingness from younger graduates to move to those locations. Finally, the industry at large tends to focus on long-term work benefits as opposed to the short-term benefits that are desired by younger generations. When all these issues are superimposed on one another, coupled with a well-established aging oil and gas workforce, it is evident that creation of a younger talent pipeline – together with their recruitment and retention – is going to be increasingly difficult. This paper provides some guidance on the strategies and tools that might specifically help recruit and retain young people into this industry.

The Australian Association of Graduate Employers (AAGE) facilitates opportunities for employers to collaborate on issues regarding graduate employment. They also survey graduates to ascertain their concerns and bridge the gap with their potential employers. The 2021 survey insights indicate the top three reasons for graduates to join an employer were:

1. The opportunity for career progression

2. The quality of the training and development program

3. The reputation of the employer

For an oil and gas company, it is useful to consider these reasons when developing recruitment messaging for graduates. Consider highlighting opportunities for career progression by leveraging a recent graduate who has secured an interesting role at the company to engage directly with potential graduate recruits. Chevron Australia utilises graduate recruits extensively in its recruitment process, particularly during the vacation internship program as part of a buddy system and has had great success in converting vacation interns to graduate employees.

In terms of the quality of training and development programs, consider adjusting the program to the current and future needs and skills of your organisation, rather than those associated with legacy programs. Chevron Australia has recently undergone a right-sizing exercise on its graduate program training requirements, which has led to more satisfied graduate employees. The new program has an increased focus on developing competencies through on-the-job experience, mentoring or formal training to help ensure graduates are empowered and in control of their own development. Flexibility in the way graduates learn, and a self-driven, just-in-time learning experience has shown success. Finally, the reputation of the employer is also a key consideration, which will be described in more detail below.

Another key insight from the AAGE survey was that most industries tend to conclude their graduate recruitment process within 2 months, whereas oil and gas companies often take 4–6 months to mature their recruitment process. Against the backdrop of other industries competing for the same talent pool, it would be prudent to consider opportunities for streamlining the length of recruitment campaigns to avoid losing candidates to other organisations simply because they received an earlier offer of employment. However, this issue must be juxtaposed with the fact that there have been record numbers of graduates declining or withdrawing from graduate programs, even after signing the contract (Duff 2021). This suggests that talent pools will mitigate against declines or withdrawals, allowing positions to be efficiently filled as they become available. Further it may be wise for companies to rethink their recruitment strategies to make more offers than required in anticipation of potential declines. Companies could also consider making positions available to identified talent while they are still undergraduates to integrate them into the business early and reduce the likelihood of withdrawal.

This issue of a leaking talent pipeline is not entirely in the industry’s control – universities are also major partners in this area. In September 2021, the world-renowned School of Earth and Planetary Science at Macquarie University was culled as part of cost-cutting strategy (Boone and Quigley 2021), the University of Adelaide only had two new domestic enrolments into their Petroleum Engineering course (despite offering a AU$20 000 scholarship), and the University of Queensland discontinued their master’s program in oil and gas due to waning interest. A similar pattern can be seen at most universities around Australia as student interest in geoscience and oil and gas related majors has seen a steady decline over time. Ironically, it is these very skills that are required to tackle the issue of climate change and sustainability and, as a society, we currently risk being unable to do so. As an example, Chevron Australia is currently using the talents of employees with these same ‘traditional’ oil and gas industry skills in its carbon capture and storage project on Barrow Island, which has the potential to revolutionise carbon-efficient LNG production. Subsurface professionals, technical facilities engineers and project management specialists are all contributing to this important project – same skills, different impact.

An opportunity to solve this industry dilemma is to rebrand courses while maintaining a similar student learning experience, thus maintaining these critical skills. Industry can partner with universities to highlight skills identified for the future of such work and ensure higher education is supported in the fields of energy transition and low-carbon innovation. Consideration should also be given to industry and universities working collaboratively to ensure ongoing supply of critical skills. For example, APPEA working with Student Edge (https://studentedge.org/us) could drive change more efficiently in this area compared with companies reaching out to each university individually. APPEA’s 2021 community sentiment survey (Lai 2021) highlights net favourability is down yet another 4% in the 18–35 cohort, however evidence (Lai 2021) demonstrates that proactive community messaging can positively impact that outcome. Notably, it is significantly more impactful to focus on utility messaging (e.g. ‘Natural gas is essential to powering Australian homes and food’) rather than simply highlighting economic benefits (e.g. ‘Oil and gas industry generates 10 indirect jobs for every one direct job’). This should also be considered when developing messaging aimed at young university students.

If we consider competing industries, or ideal workplace outcomes for Millennials and Gen Z, then there is room for this industry to show leadership in creating workplaces that are deemed desirable. It will come as no surprise that younger workers expect (and often will demand) flexibility, including remote work options, overseeing their own work schedule and the ability to make time for exercise or meditation (Miller and Sanam 2019). Particularly against the backdrop of COVID, when an individual’s education or social life has no connection to a certain time or place, the expectation of their workplace is generally the same. The pandemic has already proven that given our society is able to facilitate this level of flexibility, the younger generation will likely expect it. It remains to be seen whether the ‘flexibility stigma’ (the negative career path blowback that can occur when individuals take up flexible work options) will impact the incoming generation of workers or not (Stone and Hernandez 2013).

Existing research is clear that the younger workforce is driven by purpose (Goleman 2021) and, in the case of the oil and gas industry, that employee purpose is becoming increasingly more difficult to align with company purpose. If we are to attempt to solve this problem, we cannot shy away from the fact that we need to dig deeper and find ways to help align personal and business values for our younger workforce. Chevron Australia has seen success in finding purpose for younger professionals by offering opportunities in energy transition and new technology projects (such as CO₂ sequestration and subsea gas compression) as well as supporting graduate career pathways that align individual employee needs with business needs.

For example, three young graduates were included in a multi-disciplinary project to reduce the number of normally operating gas turbine generators at the Chevron-operated Wheatstone liquefied natural gas plant. The project resulted in reduced fuel gas consumption and total reduced greenhouse gas emissions of 15 000 tonnes of CO₂ equivalent each year. The graduate participants, who rotated through this project as part of their time in Chevron Australia’s graduate program, provided feedback that the project was aligned to their own personal values, gave them meaningful and challenging work combined with a supportive, multi-functional team. Furthermore, they are now seeing their work replicated in other business units internationally, which has given them a sense of purpose and impact.

Additionally, as an industry we should be thinking more innovatively about employing skills outside of the degree programs traditionally associated with oil and gas. Could a similar or better output be attained by a different educational background with complementary skill sets? This could be achieved by working collaboratively with universities to incorporate student trends into recruitment strategies rather than reacting to changes in university enrolments.

Together, we can improve attraction and retention of this important Gen Z cohort (and beyond) to the oil and gas sector while also addressing the issue of generational disparity in employment expectations. We hope some of the examples shared in this paper can help others consider similar strategies on an industry-wide scale. Additionally, we hope that this paper is the impetus for collaboration and communication on a topic that is bound to affect us all. This industry must stop fighting for resources in a limited talent pool and, instead, collectively support the curation of the ‘future energy leader’. A steady source of talent is critical to fill skills gaps, so let us use these tools and work cooperatively to build a secure pipeline for our industry’s future.

The data that support this study cannot be publicly shared due to ethical or privacy reasons and may be shared upon reasonable request to the corresponding author if appropriate.

All authors confirm there are no conflicts of interest.

No funding from external organisations was received for this research.