Energy sector skills shortage remains a major concern despite strong employment growth
A new International Energy Agency (IEA) report has found that, while global energy sector employment growth outpaced the wider economy in 2023, skill shortages remain a major concern.
The IEA study found that strong energy industry employment growth in 2023 was buoyed by a wave of investment in the manufacturing of clean energy technologies.
However according to the report, which assesses energy employment worldwide by region and technology, the shortage of skilled workers remains a significant issue for employers looking to hire.
Skill shortages
The lack of skilled workers was particularly notable in areas requiring high degrees of specialisation, such as grids and nuclear power.
Most respondents to the IEA’s survey of over 190 energy employers across 27 countries reported difficulties finding qualified applicants for nearly all occupational categories.
IEA director of sustainability, technology and outlooks Laura Cozzi said that, although labour shortages in construction have fallen from recent highs in many advanced economies, supply remains tight, with 75% of respondents struggling to hire for these roles.
This, in turn, leads to rising wages and is a key reason real wage growth in the energy sector has fared better than in similar roles elsewhere in the economy.
‘Engine of jobs growth’
“The global energy sector has been a powerful engine of jobs growth around the world in recent years and, as the energy system continues to transform and grow, rising demand for skilled energy workers is a given,” Ms Cozzi said.
“However, this report shows that greater investment in skills and training is critical—governments, the private sector and educational and training institutions must work together to improve the hiring pipeline, which will play an important role in shaping our energy future.”
The 2024 World Energy Employment report highlighted a 3.8% increase in global energy jobs last year, surpassing 67 million.
Job growth in the overall economy was slower in comparison, at 2.2%.
Clean energy recruitment
Clean energy recruitment led the way for the increase in energy sector employment, adding 1.5 million jobs in 2023 and contributing as much as 10% of economy-wide job growth in leading markets for clean energy technologies.
The oil and gas supply sector added more than 600,000 jobs in 2023 after a period of cautious post-pandemic rehiring.
The IEA said the growth in energy jobs is being led by manufacturing, marking a shift from previous years, when it was generally driven by construction and installation.