A new EY survey found that 90 percent of oil and gas executives agree that investments in technology and workforce are essential for industry survival of current market conditions, with 58 percent saying that the COVID-19 pandemic has made investing in digital technology more urgent.
“The COVID-19 pandemic has accelerated the timeline for some digital technology adoption from five years to three months,” said Andy Brogan, EY Global Oil & Gas Leader. “The cost savings digital can deliver is critical for survival in today’s low-price environment, as oil and gas companies look to gain greater operational efficiencies and drive productivity across the value chain. However, to capture the full value of these investments, oil and gas companies need the skills to harness and use the technology to its maximum potential.”
With the increasing urgency for digital technology within the oil and gas industries, nearly 46 percent of companies surveyed also found that their current workforces do not have the skills to fully utilize the investment of adopted technologies. The average skills gap between importance and skill maturity is around 36 percent, the survey found. For example, the critical importance of data analytics is currently at 91 percent for companies, which only have 32 percent of their workforce expertly qualified to realize the technology.
“The sector is now in a critical period in which the role of technology will only accelerate, the volume of data will only grow and competition for talent will only increase,” said Tim Haskell, US Oil & Gas People Advisory Services Leader, Ernst & Young LLP (EY US). “The challenge for oil and gas is immediate. It’s not enough for companies to simply spend more on technology. Investment in the workforce is needed to scale and integrate technologies and ultimately capture the intended value. Companies must find an investment balance while addressing market pressures. Otherwise, the industry will lose crucial years and potentially a generation of workers.”
The survey found that 92 percent of oil and gas executives feel their ability to reskill or upskill as a company will determine their success over the next three years. They also anticipate greater access to workers with digital skills within the next three years, alleviating the current shortage, which Haskell said may be overly optimistic.
“Demand for digital skills is growing across every industry. Those with AI and data science capabilities will be some of the most sought-after talent in the coming years,” Haskell said. “Oil and gas will encounter stiff competition for talent and will have to overcome negative perceptions among younger generations who tend to favor careers in technology and other industries. This makes reskilling and upskilling even more critical for oil and gas companies.”