Wanted: Oil workers
Retiring baby boomers, roaring global economy and focus on information technology are leading to a labor shortage that could squeeze supply.
NEW YORK (CNNMoney.com) -- Quit cutting chemistry class.
That's the advice experts give people wanting to capitalize on the current shortage of highly trained oil industry workers - a shortage that's also expected to delay new oil projects and could drive crude prices even higher over the next few years.
In the next three or four years, there's expected to be a 30 to 40 percent shortage of technical and professional oil workers in the Untied States, according to Damon Beyer of Katzenbach Partners, a Houston-based management consultancy that specializes in the energy sector.
Over a quarter of the industry's highly skilled employees - petroleum engineers, process engineers, geologists, geophysicists and the like - are eligible for retirement in two years, said Beyer.
"It's a real issue," said Beyer. "Success in attracting new people into the work force is limited."
Worldwide, the industry's "people deficit" is expected to reach up to 15 percent by 2010, according to Pritesh Patel, an associate director at Cambridge Energy Research Associates.
Part of this is due to baby boomers leaving the work force, and part is due to the global economic boom that has strained the heavy industry labor market in general.
But oil has its own problems.
During the 1980s, low crude prices forced layoffs throughout the industry. Around the same time, students formerly drawn to basic sciences such as mathematics, chemistry and engineering were enticed into a new, sexier field: Information technology.
"[Oil] wasn't considered the most forefront of fields to be in," said Patel.
So now, projects to find and bring new oil to market are delayed as oil firms compete with one another for workers with the competence to bring new, often challenging fields into production. It also means new, less experienced people are designing projects, and errors can be made in the design process that take time to correct before the facility can become operational.
"This could cause some delay in supply reaching markets," he said.
And as anyone who's followed oil markets over the last four years knows, supply concerns factor first and foremost in the minds of traders, who have bid prices to record highs of over $96 a barrel in recent weeks.
The industry is trying to fix the problem.
For starters, salaries are fairly high. Patel said a petroleum engineer typically earns $70,000 to $90,000 a year, right out of school.
Second, there are stronger academic programs in emerging countries, such as India and China, home of many of the new graduates entering the field. Those graduate are closer to most of the new supplies of oil, in places such as Russia, Central Asia and Indonesia.
Beyer sees that as a good thing. "This is a global problem, and it needs to be solved globally."
But even in the United States, he said enrollment at schools specializing in petroleum sciences - such as Texas A&M and Colorado School of Mines - is increasing.
That's also a good thing, as it's fairly difficult to break into these high-skilled, high-paying jobs without studying engineering and then petroleum engineering at the graduate level.
The few exceptions, said Patel, are chemical engineers and process engineers who work at places such as pharmaceutical companies, but he added that demand for engineers is up across all industries.
"Some have switched over, but we're seeing a boom in other areas of the economy as well," he said.
For those not mathematically inclined, he said there is a similar boom going on in demand for skilled trade workers - welders, pipe fitters and such.
And unlike a half decade long stint in graduate school, those programs can typically be completed at your local trade college in six months or a year, with little more than a high school diploma. The median wage for a welder is about $30,000 a year, according to the Labor Department.