The workforce of the future in energy: Challenges ahead

The energy industry, like most others, is going through wrenching changes that are reshaping how work gets done, especially considering the current geopolitical and economic context. Regardless of jurisdiction, energy companies are being forced to address global shifts in workforce demographics, aging systems, rapid changes in technology, social and economic upheaval, and energy transition.[i] These issues are forcing the industry to rethink its processes and find new ways to improve productivity, while at the same time maintaining supply and safety.

At the very heart of the change is the workforce. Today’s energy companies have always had their pick of talent, produced in abundance by education systems, to sustain legacy energy systems that are highly dependent on a skilled workforce eager for careers in energy. That assumption—a never-ending talent pipeline—is now irreversibly broken, to be replaced by a forever talent shortage. Graduates in petroleum studies in the US peaked at 2615 in 2017, and are now at 679.[ii]

This paper is the first in a series looking at the workforce of the future. Here, we’ll focus on the Yin—the challenges that companies face in assembling and developing the workforce they need to sustain the energy system on which we depend. In the next article, we’ll look at the Yang—the opportunities that await those who successfully reimagine the future of work through the lens of the workforce. Together, these two sides of the same argument set the stage for companies to thoughtfully move their businesses towards a better future.

1. Demographic and workforce shifts

The energy industry is facing a major problem: its workforce is getting older, and fewer people are joining the field. As experienced workers retire, companies are losing important knowledge and skills.

Immigration has often helped fill workforce gaps, but stricter immigration rules in some countries are making it harder to hire international talent. Canada has recently announced plans to reduce the level of immigration, and the Trump administration is also expected to resume tighter labor market access.[iii] This is adding even more pressure to find skilled workers in an already shrinking labor market.

A related issue is declining interest in energy careers. Fewer students are choosing to study fields like engineering and geology, and some universities have even cut programs that train workers for energy jobs. The University of Calgary, which graduates the bulk of petroleum engineers, suspended admissions to its program in 2021.[iv] The best engineering talent are now drawn to the tech sector instead, leaving the energy industry struggling to find new talent. These trends are making it difficult for energy companies to adapt and keep up with changing demands.

2. Skills and technology gaps

New technologies like artificial intelligence, robotics, and advanced analytics are transforming how energy companies operate. But many organizations don’t have enough skilled workers to fully take advantage of these tools. Jobs in areas like data science, cybersecurity, and automation are hard to fill, slowing down progress on important projects. There are over 3.5 million unfilled cyber security jobs worldwide.[v]

This problem is made worse by the heavy reliance on older, and in some cases, outdated systems. Many companies labour under technology that was developed decades ago. These systems don’t work well with modern tools, creating inefficiencies and holding back innovation. In some cases, private equity firms that own these systems focus more on short-term profits than on making the necessary updates, leaving companies further behind. Further, younger employees demand modern interfaces and digital tools. Google surveys suggest that over 80% of younger employees are already using AI tools at work.[vi]

As experienced workers retire, the problem becomes even more difficult. These workers often have deep knowledge about how to maintain old systems—knowledge that isn’t being taught to the next generation. Without skilled employees to keep things running or to guide the transition to newer technology, companies are struggling to stay competitive.

3. Economic and structural constraints

Financial pressures are another major hurdle for energy companies. Depressed stock prices and falling price-to-earnings ratios make it hard for energy companies to focus on the future. Instead, many companies use their available funds to buy back stock and boost share prices. This leaves little money for upgrading systems or improving productivity. In 2023, Apple’s price-earnings ratio was over 27, compared to 11.5 for Exxon.[vii]

Private equity ownership of many energy assets adds to the problem. These investors often focus on short-term profits rather than long-term improvements. They are content to leave operations with outdated systems that are increasingly expensive to maintain and hard to replace.

Updating these systems is no easy task. Many older technologies are deeply (and manually) connected to other parts of the business, making it difficult to replace just one piece without disrupting the entire operation. This creates a growing “technology debt”—the longer updates are delayed, the more expensive and riskier they become. CISQ calculates that the annual cost of this debt to the US economy is $2.4 trillion in cybersecurity and operational failures, failed development projects, and maintenance of outdated systems.[viii] At the same time, companies rely heavily on older workers to maintain these systems. When these employees retire, it becomes nearly impossible to keep things running smoothly. The debt inevitably comes due at the least opportune time.

4. Cultural and perception barriers

The energy industry’s culture is another barrier to change. Many companies prefer stability over experimentation, which makes it harder to adopt new technologies or workforce models. This cautious mindset slows progress and keeps organizations stuck in outdated ways of working.

Public perception also plays a big role. Many people, especially younger workers, view the energy industry as outdated or harmful to the environment. These negative impressions make it harder for companies to attract the next generation of talent. 50% of GenZ report that they are actively pressuring businesses to act on climate change.[ix] At the same time, industries like technology and clean energy are seen as more innovative and aligned with people’s values, drawing talent away from traditional energy companies.

These cultural and perception problems create a cycle that’s hard to break. Without a fresh approach to how the industry presents itself, energy companies will continue to struggle to attract talent and embrace the changes they require to stay competitive.

5. Global and competitive pressures

The energy sector operates in a global marketplace where competition for talent is fierce. Rising nationalism and stricter immigration rules in some countries make it harder for companies to hire skilled workers from abroad. This is especially challenging for roles in engineering, data science, and automation, where there aren’t enough qualified candidates locally.

At the same time, the energy industry is losing out to other sectors, especially technology. Tech companies offer stock options, flexible work environments, and exciting career paths that are hard for traditional energy companies to match.[x] Younger workers are increasingly drawn to these perks, making it even tougher for the energy sector to compete.

The problem is made worse by a “brain drain” to emerging markets. These regions are rapidly growing their energy sectors and offer workers opportunities for advancement and higher pay. Because these markets aren’t burdened by old systems, they can adopt new technologies faster, making them even more attractive to global talent.

To reduce the pressure from these trends, energy companies need to rethink their reliance on human labor. By automating repetitive tasks and using advanced technologies, organizations can lower their dependence on a shrinking talent pool and focus their workforce on higher-value activities.

Conclusion: Facing the workforce challenges head-on

The energy sector is at a turning point. Challenges like an aging workforce, skills gaps, financial pressures, and global competition are forcing companies to rethink how they operate. These issues aren’t just problems to solve—they’re signals that the traditional ways of working are no longer enough in today’s rapidly changing world.

The future of energy depends on innovation. Companies must become more agile, adopting modern processes and technologies to reduce their reliance on human labor while improving efficiency. Further, companies must recognize that change does not necessarily mean greater risk. With the right risk-managed approach, innovation can deliver safer, more reliable operations, where modern, data-driven insights enhance both operations and safety.

Automating routine work and modernizing systems are important solutions to these workforce challenges and will help energy companies streamline operations and position for long-term success. But these efforts must also support the ability to act quickly and decisively based on data-driven insights. Trusted data is the foundation for trusted actions, and energy companies should insist that their decision-making processes are built on reliable, real-time information.

But with every challenge comes opportunity. While these issues are serious, they also create space for bold ideas and transformative solutions. In the next article, we’ll explore the Yang—the opportunities emerging alongside these challenges. From connected workers to intelligent plants, the future of energy holds incredible potential for growth and innovation.

The road ahead won’t be easy, but it’s clear: the companies that embrace change and tackle these challenges head-on will lead the way in building the workforce of the future.