Streamlining Immigration for Skilled Trades People from Invitation to Employment
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Canadian Immigration Conference Presentation: Streamlining Immigration for Skilled Trades People from Invitation to Employment Presented June 16, 2014
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Streamlining Immigration for Skilled Trades People from Invitation to Employment
- 1. Streamlining Immigration for Skilled Trades People from Invitation to Employment June 16, 2014 Carla Campbell-Ott, Executive Director, Petroleum HR Council (a division of Enform) Funded in part by the Government of Canada and the Canadian Association of Petroleum Producers
- 2. Table of Contents (Agenda) • Introduction – Overview of the Petroleum HR Council and its Labour Market Information (LMI) Products and Services • Canada’s Oil and Gas Industry Labour Market Outlook to 2022: Key Findings and Analysis – Employment Outlook – Hiring Outlook • Value-Added Analysis – Provincial Analysis – Full Employment Impacts of Industry Investments and Activities Over the Next Decade • Recommended Workforce Solutions www.petrohrsc.ca 2 www.careersinoilandgas.com
- 3. Petroleum HR Council — a division of Enform Canada Effective April 1, 2013, the Petroleum HR Council became part of Enform: • Shared core relationships with industry associations, leaders and enterprises, as well as with government organizations. • Long-standing close relationship with Enform that supports and promotes the highest safety standards in Canada’s upstream oil and gas industry through innovative training, certifications, services and resources. • The main programs and services of the Council will continue, primarily focusing on two key areas of priority: Labour Market Information and Careers in Oil and Gas. www.petrohrsc.ca 3 www.careersinoilandgas.com
- 4. LMI Value to Oil and Gas Stakeholders • Timely, relevant and credible LMI provides facts and insights into current and future labour and skill shortages within Canada’s oil and gas industry. • With petroleum LMI, stakeholders can develop and implement effective workforce strategies to build a sustainable oil and gas workforce. • Specifically, LMI helps: www.petrohrsc.ca 4 www.careersinoilandgas.com
- 5. Our LMI Expertise We produce the following LMI products. Labour Market Outlooks: Generate long-term employment and hiring projections using an industry-validated modelling system for: – Canada’s oil and gas industry as a whole – Key operating regions: BC, AB, SK and rest of Canada – Petroleum industry sectors: exploration and production (E&P), oil sands, oil and gas services and pipeline transmission – Core and “other” occupations • Customized scenario outlooks can also be developed. • Supply projections and labour demand-supply gap analysis available for total industry and by core occupation to help understand risks and opportunities. HR Trends and Insights: Provide intelligence on current and short-term labour market conditions and HR trends within Canada’s oil and gas industry. www.petrohrsc.ca 5 www.careersinoilandgas.com
- 6. Canada’s Oil and Gas Labour Market Outlook to 2022: Key Findings and Analysis www.petrohrsc.ca 6 www.careersinoilandgas.com
- 7. Business Trends Impacting Canada’s Oil and Gas Industry • Attraction of investment – Oil sands, especially in situ – Liquefied natural gas (LNG) – Shale/conventional oil – Hebron offshore project • Joint ventures with Asian companies – Longer-term view of development and learning opportunity • Downside risks – Single customer market (US) – Lack of infrastructure to support market diversification – Skill shortages www.petrohrsc.ca 7 www.careersinoilandgas.com
- 8. Oil and Gas Industry Activity – Two Scenarios The Decade Ahead analyzes the labour market outlook for two potential industry activity scenarios based on a range of oil and gas prices, capital and operating expenditure, and oil sands production forecasts. www.petrohrsc.ca 8 Low Growth Scenario Expansion Scenario Market diversification does not occur and growth is driven by North American demand. • Moderate increases to conventional oil, oil sands and liquids-rich natural gas activity Market diversification occurs and Canadian producers supply international markets. • Debottleneck and expansion of oil pipelines • Development of LNG export facilities and pipelines www.careersinoilandgas.com
- 9. Oil and Gas Industry Employment Outlook to 2022 In the Low Growth scenario, the industry adds just under 18,300 jobs, while in the Expansion scenario, the industry adds 38,700 jobs. 240,000 230,000 220,000 210,000 200,000 190,000 180,000 www.petrohrsc.ca 9 195,200 199,700 233,900 (+20%) 213,500 (+9%) 170,000 2012E 2013F 2014F 2015F 2016F 2017F 2018F 2019F 2020F 2021F 2022F Number of Jobs Low Growth Scenario Expansion Scenario www.careersinoilandgas.com
- 10. Long-Term Hiring Outlook (2013 – 2022) Total recruitment activity over the next decade ranges between 125,000 and 150,000 to meet industry activity, age-related attrition and a 3 per cent non-retirement turnover. www.petrohrsc.ca 10 www.careersinoilandgas.com
- 11. Trades Occupations in the Oil and Gas Industry TRADES OCCUPATIONS IN THE OIL AND GAS INDUSTRY: PROJECTED INCREASES IN EMPLOYMENT TO 2022 – EXPANSION SCENARIO Occupation www.petrohrsc.ca 11 www.careersinoilandgas.com Estimated Employment 2014 Hiring Due to Industry Activity to 2022 Percentage Growth to 2022 Total – Trades Occupations 45,035 7,110 16% Power engineers (steam-ticket required) 5,720 2,170 38% Heavy equipment operators (except crane) 7,940 1,505 19% Oil and gas well drillers, servicers, testers and 13,225 1,095 8% related workers Heavy-duty equipment mechanics 2,565 550 22% Millwrights 4,595 495 11% Welders 3,745 445 12% Industrial electricians 2,180 380 17% Steamfitters and pipefitters 2,745 245 9% Machinists and machining and tooling 980 90 9% inspectors Insulators 665 70 11% Crane operators 680 60 9%
- 12. Trades with Greatest Net Hiring Requirements to 2022 TOP TEN TRADES WITH GREATEST NET HIRING REQUIREMENTS* TO 2022 (# of job openings Low Growth – Expansion) Industry Total (62,440 – 84,030 ) 1 Power engineers (steam-ticket required) 2,945 – 4,105 2 Heavy equipment operators (except crane) 2,425 – 3,990 3 Oil and gas well drillers, servicers, testers, and related workers 2,945 – 3,985 4 Millwrights 1,310 – 1,770 5 Welders 1,085 – 1,475 6 Heavy-duty equipment mechanics 905 – 1,385 7 Industrial electricians 770 – 1,085 8 Steamfitters and pipefitters 715 – 960 9 Machinists and machining and tooling inspectors 275 – 360 10 Insulators 205 – 265 www.petrohrsc.ca 12 *Net hiring requirements = hiring due to industry activity + age-related attrition (excludes non-retirement turnover) www.careersinoilandgas.com
- 13. Trades Average Age-Related Attrition Rates OCCUPATION www.petrohrsc.ca 13 AVE. AGE OF THE LABOUR FORCE TEN-YEAR AVE. AGE-RELATED ATTRITION RATE Industry Total 40 23% Crane Operators 42 25% Industrial Electricians 41 25% Power Engineers (Steam-ticket required) 38 24% Heavy-duty Equipment Mechanics 40 23% Heavy Equipment Operators (except crane) 40 23% Insulators 40 22% Millwrights 39 22% Machinists and Machining and Tooling Inspectors 41 22% Welders 39 21% Steamfitters and Pipefitters 39 20% Oil and Gas Well Drillers, Servicers, Testers, and Related Workers 37 16% www.careersinoilandgas.com
- 14. Provincial Analysis www.petrohrsc.ca 14 British Columbia (BC) Alberta (AB) Foreign investment and the province’s liquids-rich natural gas plays have kept BC’s oil and gas industry busier than expected, especially considering the lingering low natural gas price environment. However, the province is at a turning point as stakeholders wait to see if the development of an LNG export sector proceeds. Technology has a significant impact on the province’s oil and gas production potential as it allows companies to undertake new exploration and rework old wells. Alberta’s oil sands are expected to expand at a sustainable rate although growth may be impeded by market and transportation constraints. Saskatchewan (SK) Rest of Canada (RoC) Growth is driven by increased activity in the prolific Bakken shale oil formation where technology is reversing the decline in light oil production. Technology is also boosting activity around Lloydminster as thermal technology is being applied to enhance heavy oil production in the area. With the increased use of rail to address pipeline capacity issues, activity is expected to increase over the next couple of years, regardless of scenario. The majority of current industry activity is for Manitoba’s production from the Bakken shale oil formation, Nova Scotia’s offshore natural gas and Newfoundland and Labrador offshore oil. Technology has increased the potential of industry expansion across Canada, including the development of shale oil and gas deposits and the potential for LNG exports from Canada’s east coast.
- 15. Employment Impacts of Oil and Gas Investment and Activities to 2022 Investments and activities by the oil and gas industry benefit all Canadians. www.petrohrsc.ca 15 www.careersinoilandgas.com
- 16. Building Canada’s Workforce www.petrohrsc.ca 16 www.careersinoilandgas.com
- 17. Ideal Canadian Labour Supply Pools Labour Force Participation Rate www.petrohrsc.ca Landed Immigrants New Entrants Unemployed/ Underemployed Aboriginal Peoples Temporary Foreign Workers (TFWs)
- 18. Demand-driven Workforce Solutions Given the global competitiveness for skilled workers, industry must continue working with government, education and training institutions and other labour supply stakeholders to increase the talent pool for the oil and gas industry. www.petrohrsc.ca 18
- 19. To be added to our eNewsletter, email info@petrohrsc.ca Find us on social media: @PetroHRCouncil @CareersInOandG facebook.com/careersinoilandgas slideshare.net/PetroHRCouncil 19 www.petrohrsc.ca Funded in part by the Government of Canada and the Canadian Association of Petroleum Producers
Editor's Notes
- This is an update from the Petroleum HR Council’s Canada’s Oil and Gas Labour Market Outlook to 2015, released in May 2012. An overview of scope and methodology is provided in the full report which is available for download on www.careersinoilandgas.com.
- Canada’s oil and gas industry continued to attract investment throughout 2012, resulting in an acceleration of oil sands development, especially in situ operations. The past year also realized considerable interest and investment in the development of a liquefied natural gas (LNG) export sector in northwestern BC. In Newfoundland and Labrador, the Hebron offshore oil project moved into the development and construction phase, and is expected to be in production in 2017. A more stable business environment has been created with an increase in joint ventures with Asian companies. These companies are looking to learn from leading Canadian industry and oil and gas companies. The longer-term view of development also contributed to business stability as Asian companies look to secure future oil and gas supply. Looking ahead, downside risks are evident and it is increasingly clear that market diversification and a greater global presence is critical to sustainable growth within Canada’s oil and gas industry. Pipeline Projects TransCanada – Keystone XL pipeline (Awaiting Regulatory Approval) 1,897 km crude oil pipeline From Hardisty AB to Steele City Nebraska (830,000 b/d) Route approved by Nebraska (January 2013) Waiting for U.S. federal government approval (April 2014 U.S. government further delayed final decision, likely until after US mid-term elections in November 2014) Enbridge – Northern Gateway (Awaiting Regulatory Approval) Twin pipeline carrying oil to the west and condensates to the east (525,000 b/d of petroleum) 1,177 km oil pipeline from Edmonton to Kitimat 1,177 km condensate pipeline from Kitimat to Edmonton Enbridge expects a decision from the federal government by mid-2014 (reported Oct 2, 2013) The widespread use of horizontal drilling and hydraulic fracturing has unlocked natural gas and conventional oil reserves. Energy producing countries are reversing once-declining production of oil and gas, including Canada’s primary customer, the US. These developments are bringing Canada’s oil and gas industry to a critical turning point. Industry and governments are looking to solutions for market diversification and an increased global presence for its oil and natural gas, but there is a relatively short window of opportunity. The dynamic tension between opportunity and uncertainty was reflected as 2012 came to a close and a few natural gas focused companies announced employee layoffs in early 2013. Skill shortages are also a risk to the industry’s sustainability. Canada’s oil and gas industry is projected to face more job openings due to age-related attrition than due to industry activity growth (or expansion). Competition for experienced workers is expected to be fierce. Just as industry and government are looking for market diversification solutions, demand-driven solutions for workforce concerns are also required to develop a larger pool of qualified workers.
- The Decade Ahead: Labour Market Outlook to 2022 for Canada’s Oil and Gas Industry analyzes the labour market outlook for two potential industry activity scenarios. These two scenarios are based on a range of potential oil and gas prices, capital and operating expenditure forecasts, and oils sands production forecasts. Oil and gas price and CAPEX and OPEX forecasts provided by FirstEnergy Capital Corporation Oil sands production forecast, as outlined in CAPP’s Crude Oil Market Outlook (2012) The first scenario is the Low Growth scenario where market diversification does not occur and industry growth is driven by North American demand for oil and natural gas. With this outlook, there will be moderate increases to conventional oil and oil sands production, as well as a continued focus on liquids-rich natural gas. To drive growth, the industry will depend on increased North American demand for natural gas from various sources: Oil sands and other industrial uses Power generation – phasing out of coal-generated electricity Transportation – use of natural gas as fuel by medium and heavy trucks In the Expansion scenario, market diversification will occur and Canadian oil and gas producers have the capability to supply to international markets. A debottleneck and expansion of oil pipeline capacity will contribute to industry growth, as will the development of LNG export facilities and pipelines. The BC natural gas industry will see the biggest impact and benefits from this potential scenario. Pricing Forecast (developed by FirstEnergy Capital Corporation to generate expenditure forecasts): Oil and gas price forecasts are the same for both the Low Growth and Expansion scenarios. Activity levels and pace of expansion distinguishes the two scenarios based on realization of market diversification. West Texas Intermediate (WTI) oil price is forecasted to be between US$93.50 and $110 for 2013 - 2016 and then increase to US$115 to 2022. To generate expenditure forecasts, FirstEnergy Capital Corporation took into account pricing discount/differential for Canadian oil. Henry Hub (Nymex) gas price forecasted to remain below US$5 until 2015 when it increases and stays as US$5.50 for the duration of the forecast period. LNG exports are not expected to have an impact on North American natural gas price as long-term export contracts will be negotiated independently and based on a number of factors beyond the price of natural gas including processing and transportation costs.
- Regardless of scenario, Canada’s oil and gas industry will add jobs over the next decade The number of jobs added in each scenario is also referred to as “Hiring due to Industry Activity.” The difference in direct new jobs created between the two scenarios is 20,400 jobs – reflecting the reduction in job opportunities if market diversification does not occur. Unfortunately, the drawbacks continue as with every job created within the oil and gas industry, three jobs are created outside of the industry (e.g., in construction, manufacturing, transportation and warehousing, other services, retail, etc.)
- Hiring Due to Age-Related Attrition Over the next decade, 23 per cent of the industry’s workforce will become eligible to retire. The impact will be considerable, both from loss of experience and skill sets, and has repercussions for workforce development and productivity. Between 44,200 and 45,300 workers are eligible to retire in the Low Growth and Expansion scenarios respectively, and will drive the need for industry to hire and replace these workers due to age-related attrition. Hiring Due to Workforce Competition/Non-Retirement Turnover The oil and gas industry is already dealing with labour supply/demand gaps. There is no relief in sight with projected industry unemployment rates for both scenarios falling below a balanced labour market for the duration of the projection period. The intense competition for talent within and outside of the industry creates additional job openings. A 3 per cent non-retirement turnover significantly increases the number of job vacancies industry will need to fill, adding 62,600 and 65,800 job openings in the Low Growth and Expansion scenarios respectively. As a result, total hiring outlook ranges between 125,000 and 150,000 to meet industry activity, age-related attrition and non-retirement turnover over the next decade. This is equivalent to 64 to 77 per cent of current industry employment levels. Some occupations, such as entry-level oil and gas services positions, experience considerably higher unemployment rates. Innovative recruitment strategies are needed for companies to remain competitive and sustain production levels.
- HR Trends Apprentice Report: Canada’s upstream oil and gas industry is estimated to employ more than 45,000 skilled tradespeople, and industry demand for these workers is projected to grow by approximately 7,100 jobs by 2022. Demand for tradespeople is expected to grow in all skilled trades occupations, with particularly strong demand for power engineers, heavy equipment operators, and oil and gas well drillers, servicers, testers, and related workers. Oil and gas producing regions across Canada are expected to experience increasing demand for workers in skilled trades occupations over the next decade. Alberta: Between 2013 and 2023, Alberta is expected to experience shortages (projected hiring demand minus projected supply) of 6,788 workers in skilled trades occupations that are core to the oil and gas industry. British Columbia: Industry expansion in British Columbia is expected to result in new demand for over 7,637 additional tradespeople in core oil and gas occupations between 2010 to 2020. Saskatchewan: The number of trades employment opportunities due to new job creation in Saskatchewan will be approximately 5,400 additional trades and transport workers from 2013 to 2017. Atlantic Canada: In Newfoundland and Labrador, the greatest occupational demand between 2011 and 2020 include Oil and Gas Drillers, Supervisors for Oil and Gas, Operators in Oil and Gas Drilling, and Machinery Equipment Mechanics.
- The age-related attrition rate for crane operators, industrial electricians and power engineers are higher than the industry average of 23%; these occupations may experience skill shortages.
- BC - Foreign investment and the province’s liquids-rich natural gas plays have kept BC’s industry busier than expected, especially considering the lingering low natural gas price environment. However, the province is at a turning point as BC and the rest of Canada wait to see if the development of a LNG export sector proceeds. In 2012, the province employed a little over 12,000 of Canada’s oil and gas workforce. AB - Alberta’s oil and gas industry directly employed close to 160,000 workers in 2012. In addition to the oil and gas field and operations workforce employed across the province, Alberta is home to the majority of the industry’s head office jobs. Approximately 90% of the oil and gas jobs in the province will be generated due to investments and activities in Alberta. The remaining 10% will be generated due to activities in BC and SK, and are for head office roles. SK - In 2012, Saskatchewan employed approximately 11,600 of Canada’s oil and gas workforce. Similar to BC, investments and activities by the oil and gas industry in SK also generates jobs in head office positions, which are primarily based in Alberta. Approximately 40% of jobs generated by activities in the province are actually for head office roles and were therefore allocated/added to Alberta employment numbers. RoC - Industry employment within the rest of Canada is estimated at 12,200 workers in 2012. The majority of oil and gas activity in the rest of Canada takes place in: Manitoba oil production from the Bakken shale oil formation Nova Scotia offshore natural gas Newfoundland and Labrador offshore oil
- The sizable cumulative investment in development and operations within Canada’s oil and gas industry to 2022 is estimated to sustain an annual average of 894,100 to 1,036,100 direct, indirect and induced jobs across Canada. Although majority of the jobs are expected to be found in Western Canada (approximately 80 per cent employment share with Alberta employing close to 65 per cent of the total workforce), other provinces will also benefit from an employment perspective including Ontario, Quebec, Newfoundland and Labrador and Manitoba. Between 2013 and 2022, the industry will sustain an average of 213,000 to 224,400 direct jobs each year in exploration and production, oil and gas services and pipeline operations. In addition, between 413,400 and 505,300 indirect jobs will be sustained each year in: construction, manufacturing, transportation and warehousing, professional, scientific and technical services, waste management and remediation services, financial, insurance, real estate and rental and leasing. Finally, an average of 267,700 to 306,400 jobs each year will also be supported or ‘induced’ in the broader economy, largely through a general increase in consumer spending by direct and indirect workers. Simply put: for every direct job created within oil and gas industry operations, three jobs are created outside of the industry. Investments and activities by the oil and gas industry, including LNG development on the west coast, offshore oil development on the east coast, and oil sands development in Alberta will continue to benefit all Canadians.
- Growth rate of working age population From 2005-2006, working age population grew at a rate of 1.22% per year. From 2011-2012, working age population grew at a rate of 0.69% per year. Labour force participation rate The labour force participation rate trend has remained steady at 65% between 2006 and 2014. Historically, industry has not attracted its share of workers from all potential labour supply pools. Canada’s total labour force grew 4.92 percent between 2006, while the oil and gas labour force grew 14.30% over the same period. New Entrants Canada’s population aged 15-24 years shrank from 5,576,805 in 2006 to 4,324,070 in 2011 (a decrease of 22.46 percent). Canada’s labour force aged 15-24 years in the oil and gas industry shrank from 24,901 in 2006 to 19,065 in 2011 (a decrease of 23.44 percent). TFWs The number of non-residents in Canada on work visas rose from 255,330 in 2006 to 445,580 in 2011 (all industries, an increase of 74.5%). Aboriginal population The Aboriginal population in Canada grew from 1,172,785 in 2006 to 1,400,685 in 2011 (an increase of 19.4 percent). Between 2001 and 2026, more than 600,000 Aboriginal youth will come of age to enter the labour market. In 2011, Aboriginal youth represented 18.2 percent of the Aboriginal population and 5.9 percent of all youth in Canada. Landed Immigrants Economic category (sponsored by an employer): 138,250 in 2006 and 186,880 in 2011 (an increase of 35 percent) Family category (no work sponsorship required): 70,517 in 2006 and 60,207 in 2011 (a decrease of 14.6 percent) Refugees: 32,499 in 2006 and 24,693 in 2011 (a decrease of 24 percent)
- Provinces with higher unemployment rates may offer labour supply opportunities through a variety of labour pools such as unemployed and under-employed workers, New Canadians, youth and new grads who may not be able to find employment in their home provinces, and workers from other industries with transferable skills. To have full access to workers throughout the country, there is a need for the enhancement of mobility of transferable skills and qualifications across industries and Canada. Companies also need to do their part by offering rotation schedules, and accommodation and transportation support that are attractive to workers from across Canada. Critical to ensuring a sustainable industry workforce is the development of a more effective and efficient education and training system. Workforce numbers will increase if the education system, industry and government can work together to achieve the following: increase high school completion rates so that youth have the pre-requisites required to train and obtain long-term careers; increase youth enrolment in relevant post-secondary training; and undertake effective program planning and alignment of post-secondary training with industry needs. A commitment to increase energy literacy and career awareness across Canada is required. The oil and gas industry still has to overcome a number of misconceptions and negative perceptions. There is a need to educate Canadians, not only about the direct and indirect employment opportunities and how to access them, but also about how the industry works and what it is doing to improve its environmental performance. Another practical solution is to increase use of apprenticeship programs, with employers taking on more apprentices. For many, these apprentices become fulltime employees who over time gain considerable knowledge and experience. While “Canadians first” should be top priority, temporary foreign workers are a solution for filling temporary or shorter-term assignments. In addition, economic immigration programs can be utilized to address labour and skill shortages within industry-specific occupations. Collaboration, on-going dialogue and a commitment to innovation and outside-the-box thinking are essential to ensure that future workforce needs can be met.