The oil and gas sector could create as many as 34,000 new jobs in the UK in the next two years, however, a skills shortage still remains the biggest challenge.
That’s according to new research by Lloyds Banking Group, which claims around 77% of businesses in the oil and gas sector are planning for growth between 2013 and 2014 but a third said they would face a shortage of skills during that time.
The ‘Oil & Gas: Rising Fortunes 2’ report surveyed 100 UK oil and gas firms, which found 37% of service and equipment suppliers are worried about the lack of skills more than exploration and production firms (25%). Half of businesses said training existing workers was the preferred way of dealing with the shortage of skills, followed by working with universities (24%) and launching apprenticeship schemes (23%).
According to the report, oil and gas firms said the biggest opportunity was moving into new growth markets, with 17% showing an interest in unconventional oil and gas, including fracking – the controversial process of extracting oil and gas.
Stuart White, Area Director of Lloyds Bank Commercial Banking North of Scotland said: “The 100 companies we surveyed have committed to creating 5,000 jobs, which if replicated across the industry would see tens of thousands of jobs created over the next two years. This is on the back of two-thirds of companies expecting further internationalisation and significant investment. The development of new oil and gas fields normally grabs the headlines for sheer size of investment and job creation but this survey has found that some equipment and service suppliers may create an even bigger numbers of jobs, albeit in a series of growth steps rather than the one big project.
“The report also highlights the challenge posed by the lack of a skilled workforce. The survey acknowledges that positive action to address this shortfall is underway with established partnerships between higher education and the creation of apprenticeship schemes but this is a long-term solution and will take time to alleviate the current pressure.”
The research also found more growth is planned by oil and gas equipment suppliers (80%) than exploration and production firms (72%) and companies based in Scotland are more growth orientated (83%) than those in the North and Midlands (75%) and the south (74%).
Last month ELN reported trade body Oil and Gas UK’s announcement that investment is expected to rise to £13 billion in 2013, from £8.5 billion two years ago. The industry is believed to currently employ around 440,000 people in the UK.