Looking Further Afield

Any Economics 101 class will instruct students about supply and demand. When one or the other gets out of balance, bad things can happen.

For instance, fuel prices are high right now because supplies are low. This is good for the oil industry; not so good for the overall economy. On the other hand, there aren’t enough skilled workers to fill the shoes of the vast number of baby boomers expected to retire in the next few years. This is bad for the oil industry.

The drilling contracting segment is particularly desperate to find new people. Dr. Lee Hunt, president of the International Association of Drilling Contractors (IADC), estimates that offshore rigs currently under construction will require an additional 17,000 people not currently employed in oil and gas (Figure 1). This figure does not include the number of personnel needed to operate land rigs, which also ranges in the thousands.

In 2007 the IADC decided to stop complaining about the personnel shortage and do something about it. Mindful of the fact that not all industries are facing the same shortage, the company launched a Web site called “Career Connections” (www.careers.iadc.org) to encourage employees in other industries who might be losing their jobs or those in the military about to return to civilian life to take a look at oil and gas.

“Our traditional recruiting grounds – South Louisiana, West Texas – have long since been hunted out,” he said. “The global search for talent is a challenge. The industry needs to present a contemporary image. It’s not rusting iron and bolts; it’s fairly sophisticated and moderately high-tech.”

In what might have been viewed as serendipity if so many people’s livelihoods weren’t in limbo, information came to the IADC that could be a potential solution to its problem. “On May 7, 2007, the same week we launched Career Connections, Ford Motor Co. announced it would be closing its Brook Park casting
plant outside of Cleveland,” Hunt said. “More than 1,000 Ford employees were to be affected.”

The IADC contacted Ford about the possibility of transitioning these displaced workers into the oil and gas industry. Ford officials were at first wary of the difficulties.

“We were seeking local jobs,” said Nathan Meadows, a strategy analyst in the Manufacturing Business Office for Ford. “The manufacturing facilities where a majority of our employees are working are in the Midwest – Michigan, Ohio, and Kentucky. They were looking for opportunities closer to home, and they wanted to be financially reimbursed similar to what they were making at Ford.”

IADC personnel had anticipated this issue and had an answer, Hunt said. “Bob Long was the chairman of IADC in 2007. We asked him what he’d like to see IADC achieve during his term. He understood the desperate need for rig-level personnel, and he said that with air transportation being as inexpensive and convenient as it is, we could recruit from geographical areas that haven’t been accessible to us in the past.

“Fifteen years ago, if you found a good diesel mechanic in Cleveland, you’d have to relocate him and his family. But today he can fly from Cleveland to Dubai or Singapore at a cost far less than relocation.”

Getting acquainted

The IADC had hired Linda Silinsky-Kephart to get Career Connections up and running, and she identified several methods to reach out to employees in other industries: direct employer workshops, traveling job fairs, and a returning- military campaign.

Direct employer workshops are meetings that IADC organizes between its member companies and companies that have impending layoffs. “IADC presents an overview of the drilling business and orchestrates events affording opportunities for its member companies to conduct workshops to educate and discuss possible employment,” Hunt said.

Traveling job fairs target specific geographic locations where unemployment is high within a community. In this case, IADC secures a meeting location, publicizes each event with the local media, and works in conjunction with community offices and the Chamber of Commerce.

Returning-military campaigns work with all branches of the US Armed Forces. IADC conducts job fairs at targeted transition bases in the United States to attract and recruit all ranks of the military with a variety of skills.

In Ford’s case, IADC contacted the company, discussed the employment needs of the drilling industry, and offered to conduct a direct employer workshop at the Brook Park facility. “Ford was already very proactive in holding human resources [HR] meetings and setting programs in place to help its employees secure new employment,” Hunt said. “Working closely with Ford, IADC developed flyers and a presentation that talked about the drilling industry. Ford discussed our visit at their HR meetings and even announced the event on a marquee where the job fair was conducted.”

This first direct employer workshop attracted more than 400 Ford employees. Four drilling contractors took part in the event. From their standpoint the event and others like it are helpful finding a variety of skilled workers, including electricians, draftsmen, engineers, and mechanics, who can easily transition into a career on a drilling rig.

IADC member companies are also finding success at demobilization bases by presenting generic information and bringing along individual company recruiters. “These people come with a variety of skills,” Hunt said. “Culturally they’re attuned to the work schedule, and their enthusiasm level is high.”

A match made in heaven

From Ford’s perspective, the job fairs and employer workshops are a godsend. Meadows said the company started offering voluntary separation packages in 2006 and has had success reducing the size of its workforce. But he can’t rule out the possibility that more layoffs are on the way.

“It’s unfortunate that the economy and the industry as a whole just keep warranting further right-sizing,” he said.

That’s why the interest from IADC has been so helpful. Ford has done its own marketing as well to inform its departing employees of opportunities in oil and gas and has even posted a Web site video explaining the basics of the industry (yourjobconnection.org). “We want to allow our employees to have a smooth transition to other industries that will value what they have to offer.”

In addition to oil and gas, there has also been interest from the medical industry and the manufacturing industry outside of automotive. Once a dying industry in the United States, even the railroads are hiring these days.

While the company was initially leery about the possible need for relocation, the pay was not an issue, and once Ford officials were assured that contractors would be willing to transport employees to the job site, the deal was settled. “Once that bridge was crossed, it was a perfect match,” Meadows said.

What do auto workers think about drilling for oil in the Gulf of Mexico or the deserts of Saudi Arabia? “I think they’re pleasantly surprised,” Meadows said. “We’ve had success stories with several different companies that the IADC represents, and each one of them can speak highly of the employees that they’ve hired.”

Currently the company is coordinating additional job fairs and bringing recruiters into its facilities and off-site locations to promote opportunities. “I envision the IADC and the oil and gas industry being an integral part of those promotions,” he said.

Meadows encourages other trade organizations or companies within the industry to contact him about possible recruiting opportunities. He can be reached at nmeadow1@ford.com