Skill gaps are rising, just as entry-level salaries are. But solutions to offset the aging demographics of the oil and gas industry must be about more than money, according to recruiters and human-resource pros who spoke at R&R: Recruiting & Retention, hosted in Houston by Oil and Gas Investor and E&P magazines recently.

"In this day and age, making sure your pay structure is good is just your ticket to get in the game," said Lawrence Pope, vice president, human resources and operational excellence, for Halliburton.

Last year, the company hired 13,500 people worldwide, from 120 nationalities. That diversity adds a larger talent pool from which to hire and brings new value to the company.

But the competition for talent is fierce. "The average candidate is on the market a month now and going to multiple job interviews, so it's important to make your offer quickly," advised Mona Leigh Bernhardt, vice president, HR, at Newfield Exploration Co. "But it isn't just about the money. You really do need to sell your work environment."

As the company's staff has increased from 108 employees in 2000 to about 900 today, Newfield had to become more proactive.

"You can't let your support structure go while you are trying to build the dam, so our first priority was to retain the people we had. We had to think hard about what to offer two different age groups: What do they want, coming out of college? And what do our older employees need and how can we slow the retirement curve?"

Today Newfield has family-friendly, flexible work arrangements, a flat organizational structure and a good bonus program with stock incentives. The employee attrition rate has improved to about 7%, or half the rate for petro-tech jobs industry-wide, she said.

Since Newfield started an intern program in 1997, some 100% of its summer interns end up working for the company.



Transforming the culture

A cultural interview ought to be part of the hiring process, advised Mark Steinke, vice president of recruiting and staffing for SAP Americas. A highly skilled person who fits management's criteria may not be a good fit otherwise, based on work habits, personality, ethics and day-to-day work expectations.

"We have six cultural statements or values we talk about at SAP, and we interview people with that in mind. We can argue about whether they are the right six things, but a job candidate has to agree to work with them."

He said the standard ratio is to interview three or four people to hire one. If a company is interviewing more, that indicates problems in the sourcing, interviewing or hiring process.

Last year, SAP hired 2,800 people worldwide and 45% of those were employee referrals. Every new hire is asked to give the R&R team five names to contact. This volume of hiring needs to be efficiently managed. "You're not going to hire enough people without a process and you need technology behind it."

For El Paso Corp., hiring enough people was a big challenge in the recent past. The company went through a wrenching restructuring to pay down debt and counteract negative publicity.

"We were the poster children for change," said Sue Ortenstone, senior vice president, HR. "Our stock went from $74 to $3.45...People questioned our existence and we almost went under. It was very hard to retain employees, much less recruit them."

From that low, El Paso has changed upper management and the board, sold billions of dollars of assets, and recovered financially. Along the way, a survey of employees found they had very negative attitudes toward the company, particularly about its ethics. In 2004, only 48% of employees had a favorable view of the company. In 2006, 78% did.

"They are happy and engaged now," said Ortenstone. "We try to sell that we are doing meaningful work-our pipelines handle 25% of the natural gas in this country, and our E&P segment is growing. There are great career opportunities now.

"We pay for performance and simplified the company. We are proud of our accomplishments-that is a message we can sell to prospective employees."

Rapid growth in a time of acquisitions and stepped-up drilling has meant Chesapeake Energy Corp. had to improve its hiring and retention processes, said Martha Burger, senior vice president, human and corporate resources.

"Five years ago, we had 600 employees. Today we have 6,000. Over 50% of the hires we've made in 2007 have been 30 years of age or younger. That's brought down the average age of our engineers to 38."

The company aggressively recruits on campus and hires most of its summer interns. "This is not an HR initiative; it's a business initiative."