December 9, 2019
Despite the climate of disappointment with the absence of major oil companies in the last two pre-salt auctions in November, the oil and gas labor market is once again gaining momentum in Brazil. After five years of shrinking without respite, the percentage of open positions for middle and senior management positions in the area jumped 8.5% in the first ten months of this year. Salaries are still not recovering at the same pace, but were up 2% in the year, according to a survey by international recruitment consultancy Michael Page at the request of Estadão / Broadcast.
After experiencing a boom from 2010 to 2013, in 2014 the sector was hit by a kind of perfect storm: low oil prices; allegations of corruption in the Lava Jato operation; the crisis in Petrobras; Eike Batista’s OGX collapse; shortage of area concession auctions; sluggish economy and a brake on oil and gas exploration projects.
The combination of these factors ended with a sharp 20% drop in wages in 2014, which followed throughout 2015 (-10%) and 2016 (-5%).
Head of Michael Page for oil and gas recruitment, Otávio Granha says it is already possible to detect a pick-up in demand and wages in technical positions linked to the exploration and development phase of oil fields.
“This growth will not be accelerated as it was at the time of the boom, but it will be more sustainable than it was at that time,” says Granha, for whom the fastest growth will come in 2021.
The return of the auctions promoted by the National Agency of Petroleum, Natural Gas and Biofuels (ANP) in the last two years has heated the demand for professionals working at the beginning of the oil chain. This is the case of the positions of geophysicist and geologist, whose salaries were up 64% and 38%, respectively, from January to October 2019.
According to Michael Page, currently a geophysicist in Brazil can earn up to R$ 27,000/month, while a geologist’s salary has a floor of $ 14,000 and a ceiling of $ 42,000/month. Already a reservoir engineer, another position in upward curve, receives between R$ 12 thousand and R$ 40 thousand, a level 44% higher than 2018.
The resumption of investments, coupled with the volatility of oil prices, has led to the need for companies to cut expenses, opening opportunities for professionals specializing in supply and supply chain management. In this area, there was a 19% increase in salaries paid.
“This year, we hired two geophysicists, a geologist and a reservoir manager. In the process, we noticed that the market is heating up. It was really difficult to find qualified professionals for the role,” says PetroRio’s Subsurface and Production Manager, Lincoln Makajima.
The engineer says this movement began last year, with the beginning of the pre-salt field development phase. This is likely to intensify due to the shortage of skilled labor and the search for professionals for oil companies entering the market – such as those acquiring stakes in fields for sale by Petrobras. This year PetroRio has lost at least one geophysicist and one geologist to another large oil company.
“Our perception is that the level of activity in the sector shows a clear recovery. This trend should intensify from the development phase of the production of exploratory blocks auctioned in the last two years, especially pre-salt” , says the president of the Brazilian Institute of Oil, Gas and Biofuels (IBP), Clarissa Lins.
Formed in 2015, at the height of the oil and gas crisis, geologist Suelen Gouvêa, 29, could not find a job in her area. She decided to pursue a master’s degree in geophysics while waiting for the market to improve. Four years later, she got her first job at a service provider for Petrobras.
The professional moved to Macaé and says that the city, which went through a period of doldrums, now has movement again.
“I even had difficulty closing a rent that fit my budget. After I arrived, the company has already made other hires. I think that by 2020 it will get even better and 2021 will be the peak.”
Currently, the oil and gas chain employs about 400,000 people, with salaries four times higher than the national industry average. That number could double by 2022, according to a study by the Brazilian Petroleum Institute (IBP) and Ernst & Young.
With participants such as Baker Hughes and Halliburton, the Brazilian Association of Petroleum Services Companies (ABESPetro) estimates that, for each job generated, two others are induced in other direct and indirect suppliers, and another eight are generated by income effect.
A study by the entity and Accenture Strategy points out that 359,000 jobs were lost in the supply chain from 2013 to 2018. By 2026, it is expected that 721,000 jobs can be generated. That would mean reaching almost 1.2 million jobs in the sector.