Houston — The utility sector's unemployment rate in February, at 0.9%, representeda three-year drop of almost 79%, which may reflect a tightening of thepower industry's labor market as an aging work force retires withoutenough replacement workers.
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Citing the US Department of Energy's Quadrennial Energy Review that wasissued in January 2017, Seth Blumsack, undergraduate chairman ofPennsylvania State University's Energy Business and Finance program,said, "There is some evidence that the sector as a whole is not on trackto replace those workers that are retiring."
The DOE's 2017 US Energy and Jobs Report provided some demographic datato back up the QER's concerns. The electric power generation sector'sworkforce is disproportionately older, with 28% over age 55, comparedwith 22% for the national workforce average.
Through the third quarter of 2017, the latest period for which the USBureau of Labor Statistics has sector-level data, the power generation,transmission and distribution sectors employed more than 388,000 people,virtually flat with the 389,000 people employed in the field in the thirdquarter of 2013, but the mix between generation workers and those whowork with the wires -- transmission and distribution -- has shifteddecidedly.
Generation employed less than 156,000 people in the third quarter of2017, down from almost 162,000 in Q3 2013. In contrast, the T&D sectoremployed more than 232,000 in Q3 2017, up from less than 228,000 in Q32013.
Perhaps not surprisingly, the average weekly wages for T&D workers grewat an annual rate of about 4%, double generation workers' 2% annual wagegrowth rate. "Some blue-collar jobs, like linemen, are likely to be in particularlyhigh demand," Blumsack said in an email Friday. "The DOE report alsocites a gap between the needs of the industry as it goes through asignificant technology transition and the typical education that someonein the power sector might receive."
One bright spot in the Energy and Jobs Report, from the utilities'perspective, was that transmission and distribution workers skew youngerthan the national labor market as a whole, with 19% of the sector'sworkforce age 55 or older, compared with 22% for the national workforceaverage.
TRYING TO MAKE POWER 'AS COOL AS GOOGLE'
During CERAWeek by IHS Markit in Houston on Thursday, PatriciaVincent-Collawn, Public Service Company of New Mexico president and CEO,said, "We must make our industry cool, to give kids the sense that theindustry is as cool as Google. ... Otherwise, none of us can retire."
The 2017 Energy and Jobs Report noted that 73% of generation,transmission, distribution and energy efficiency companies "reporteddifficulty hiring qualified workers" over the previous 12 months, with26% stating that it was "very difficult."
For the generation sector, the types of jobs that were most difficult tofill were construction, with 82.1% reporting "somewhat difficult" or"very difficult" experiences filling these types of jobs.
Construction jobs were also among the most difficult to fill (almost 68%)for the transmission and distribution sector, but manufacturing jobs(e.g., assembling switches and transformers), were the most difficult,with almost 82%.
Adrian De Luca, a partner at Twenty First Century Utilities, an owner andoperator of regulated utilities, said a lack of capable workers "iscertainly a problem."
Joshua Rhodes, University of Texas Energy Institute research associate,said that "anytime you end up with a generational or really any kind ofgap in your workforce, you are going to be worse off."
"While in the past utilities might not have had to worry about whatsociety thought, in today's world of deregulation and emphasis on theexternalities of our energy consumption, knowing the temperature ofsociety can mean the difference between survival or not," Rhodes said inan email Friday. "You need internal voices that can speak that language."
But Bob Anderson, vice president for business development at TenaskaPower Services, a private generation development and management company,suggested the problem may not be so dire, if a company is creative anddiligent in its recruiting.
"I find many companies today are sending our job descriptions to largejob boards and then they sit back and wait for responses," Anderson saidin an email Friday. "Then they digitally filter people out based onsimplistic questions like do you have a four-year degree -- yes or no. Idon't believe the companies that are relentlessly and creatively seekingtalent are having trouble finding qualified young people."
MUST MORE EFFECTIVELY TARGET CANDIDATES
As alternatives, Anderson suggested approaching the military forgeneration, distribution, mechanical and electrical workers. Formarketing people, he suggested a social media contest with a job for thewinner.
"If you want the drone operators to take over your physical inspectionsof your lines and equipment or your GPS system library call a school likeLeTourneau University in Longview, Texas, or advertise in RotorDronemagazine," Anderson said. "My point is that these activities wouldrequire a [human resources] team that is willing to 'get after it' andhiring leaders that are actually willing to act like 'our people are ourgreatest resource' is something more than a catch phrase and invest intheir future team. ... So my opinion is for the right companies there isno shortage of great young people."
Carey King, UT Energy Institute assistant director and researchscientist, expressed uncertainty "about a supply problem in terms ofkeeping the grid operating with line operators and maintenance crews."
"The service of electricity is so valuable and vital that if needed, itwill command the skill it needs," King said. "The thermal powergeneration infrastructure will change more and put pressure on the jobswithin that supply chain."
Penn State's Blumsack offered some hope for power sector employersseeking qualified people.
"We don't keep bulletproof data on this, but the demand for graduatesfrom Penn State's interdisciplinary Energy Business and Finance programby companies in the electricity sector has skyrocketed over the past fewyears," Blumsack said. "As recently as five years ago most of our gradswent into oil/gas; now more than 50% are going into electric power, andwe are getting more and more companies from the electricity industryrecruiting these students specifically."
--Mark Watson, email@example.com
--Edited by Matt Eversman, firstname.lastname@example.org