Canada’s oil sands workforce requirements impacted by shift from expansion to maintaining operations
A shift in Canada’s oil sands sector from growth and expansion to improving the reliability and performance of existing operations will have long-term impacts on the sector’s workforce requirements. By 2020, the sector will experience a decrease in demand for about 10,305 on-site construction workers but generate 5,170 operations and 4,700 ongoing maintenance jobs, according to PetroLMI’s latest labour demand outlook report.
The report, Oil Sands Construction, Maintenance and Operations Labour Demand Outlook to 2020, provides insight into the impact of 2015 spending and production forecasts on longer-term hiring requirements in the oil sands sector.
With a 30 per cent decrease in capital spending in 2015, the oil sands sector delayed, deferred or cancelled a number of projects. As a result, demand for future on-site construction labour has been significantly reduced. At the same time, however, production from the oil sands sector will continue to grow across mining, in situ and upgrading operations from projects that are either in the late stage of construction or have recently transitioned into operations.
“Overall workforce requirements for the oil and gas industry has been severely impacted by a reduction in investment. However, substantial capital has already been invested in large-scale oil sands projects so hiring is expected to continue to 2020,” says Carol Howes, Vice President of Communications and PetroLMI, with Enform. “What remains to be seen, as on-site construction of major projects winds down towards the latter half of the forecast period, is the impact of lower oil sands capital investment on production and jobs after 2020.”
At peak construction, the sector will still require approximately 38,000 construction workers annually to maintain operations and could hire up to 9,500 operations positions, assuming historical retiring patterns continue.
“One of a number of factors that could impact future hiring is the rate of retirement and how much the recent downturn has impacted retirement rates,” says Howes. “Another important consideration is that this report is based on certain capital and production assumptions, so further capital spending or production cuts will also impact these future labour requirements.”
The oil sands sector is expected to achieve significant productivity gains over the next few years as cost reductions occur at the same time that production increases.
“As the industry works towards returning to profitability, it is expected that companies will streamline processes and invest in technologies to further improve operational efficiencies,” says Cameron MacGillivray, president and CEO of Enform. “And, what that means for the future is that companies will need to continue to attract, retain and develop a highly skilled workforce in order to maintain any productivity gains.”
Oil Sands Construction, Maintenance and Operations Labour Demand Outlook to 2020, is one of a series of employment outlooks to be released by PetroLMI in early 2016. Other reports will include labour market insight into the exploration and production (E&P) sector, oil and gas services, pipelines and liquefied natural gas (LNG). Each of Canada’s oil and gas industry sectors is being impacted differently by the current economic environment. If additional changes are made to capital spending or production forecasts, PetroLMI will explore providing an update to the Oil Sands Construction, Maintenance and Operations Labour Demand Outlook to 2020 report later in 2016.
Oil Sands Construction, Maintenance and Operations Labour Demand Outlook to 2020 is now available at no charge on PetroLMI’s website, careersinoilandgas.com.
Funded by the Government of Canada’s Sectorial Initiatives Program and the Canadian Association of Petroleum Producers (CAPP) and in partnership with the Government of Alberta’s Ministry of Labour and the Construction Owner’s Association of Alberta (COAA).
The Petroleum Labour Market Information (PetroLMI) Division of Enform (formerly the Petroleum Human Resources Council) is a leading resource for labour market information and trends in the Canadian petroleum industry. PetroLMI specializes in providing petroleum labour market data, analysis and insights, as well as occupation profiles and other resources for workforce and career planning.
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