Oil and gas to add 39,000 new jobs in UK

Thursday 10 April 2014

Limited company contractors in the oil and gas sector are likely to benefit from the creation of up to 39,000 new jobs over the next two years.

Research from the Bank of Scotland, which surveyed a broad cross section of 100 UK oil and gas companies, found job creation was high on the agenda.

Over the last year alone, employment forecasts have increased by 5,000, with companies in 2012 expecting 34,000 new jobs to be delivered over the next two years.

Stuart White, Bank of Scotland commercial area director, said: "The findings of this report are excellent news for the economy demonstrating the employment generating nature of the oil and gas industry now and in the future. With most of the UK’s oil and gas firms clustered in Aberdeen and the North-east, Scotland should reap the largest share of these new jobs, however other parts of the UK will benefit from expansion plans."

Confidence is soaring in the sector, with 69 per cent of British-based oil and gas executives optimistic about their growth prospects for 2014 and 2015. While this is down on the 77 per cent that expected growth last year, it indicates that conditions in the market remain strong.

However, a lack of skills could throw a spanner in the works for those companies intending to grow and expand their workforce. Thirty-eight per cent of executives believe the greatest challenge they will face over the next two years will be the skills shortage, up from 33 per cent in 2013.

Engineering companies expect to suffer the most from the lack of talent availability, with 87 per cent predicting skills will become a challenge. Conversely, just 20 per cent of exploration and production firms expect talent to be an issue.

"Positive action is underway to address this [skills] shortfall, with new partnerships between higher education institutions and industry as well as the creation of new specialist apprenticeship schemes," Mr White stated.

It isn't just UK shores that will benefit from an increase in activity from British-based oil and gas companies, however. Sixty-four per cent of respondents told the Bank of Scotland that international expansion was a priority. Africa is a site for investment, with over a fifth targeting growth there. Seventeen per cent also intend to expand into North America, while 18 per cent have their sights set on the Middle East.

Forty-two per cent of executive consider new international growth markets to be the biggest opportunity for the industry. However, ten per cent claim they struggle to access projects in new growth markets.

Nevertheless, international income accounts for 44 per cent of turnover and 46 per cent of exploration and production companies intend further expansion in foreign markets in the next 24 months.

The Bank of Scotland has noticed this trend is becoming widespread and is mirrored in its client base.

"We have seen a significant increase in our support to the industry in recent years to facilitate international expansion and we expect this trend to continue," Mr White said.

By Victoria McDonnell

Get in touch

Please select your type of enquiry:

Brookson on Twitter