study of apprenticeshiptraineeship schemes

[Year]

OPITO Study of Apprenticeship/Traineeship

Schemes in the Oil and Gas Industry

May 2012

Report prepared by Praveeni Kirtisinghe

Contents

Executive Summary ... 1

Introduction ... 3

1. Breakdown of Respondent Companies by Industry Sub-Sector ... 4

2. The Status of Apprenticeship/Traineeship Schemes ... 5

3. Existing and Future Apprenticeship/Traineeship Schemes ... 7

4. Criteria for Apprenticeship/Traineeship Schemes ... 11

5. Reasons for Not Having a Scheme ... 13

Conclusions and Next Steps ... 14

References ... 16

List of Figures

Figure 1-1: Breakdown of Respondent Companies by Industry Sub-Sector ... 4

Figure 2-1: Status of Apprenticeship/Traineeship Scheme ... 5

Figure 2-2: Status of Apprenticeship/Traineeship Scheme by Industry Sub-Sector ... 6

Figure 3-1: Number of Companies with one or more Existing Schemes... 7

Figure 3-2: Number of companies with one or more Potential Schemes ... 8

Figure 3-3 : Estimated Intake from 2012 to 2014 ... 8

Figure 3-4 : Estimated Intake from 2012 to 2014 for Existing Schemes ... 9

Figure 3-5 : Estimated Intake from 2012 to 2014 for Potential Schemes in the Next Two Years ... 9

Figure 4-1 : Minimum Qualifications Required ... 11

Figure 4-2 : Duration of the Scheme ... 12

Executive Summary

OPITO has undertaken a study of Apprenticeship/Traineeship Schemes in the Oil and Gas Industry. The aim is to understand the current and emerging climate with respect to support and engagement in future schemes, industry attraction and apprentice intake.

This will allow OPITO to collaborate more effectively with the Oil and Gas Industry to predict and plan apprentice/trainee intakes and establish whether there are any disparities with numbers and identify any gaps in qualifications and training. OPITO will be able to ascertain if any common challenges prevent companies from having an Apprenticeship/Traineeship Scheme and identify solutions. The findings should also assist in defining the future apprenticeship projections over the next two years.

In order to obtain the following data across the industry, a representative sample of 382 companies was surveyed. The report includes the analysis of information provided by 107 respondents who fully completed the survey.

The key findings of this study:

 The respondents belong to a range of sectors from operators to companies providing support functions to the industry. The majority of the respondents were engineering, design and maintenance companies, accounting for 29% of the responses (31 companies).

 69% (74 companies) of the respondents have stated that they either currently have an apprenticeship/traineeship scheme or that they are in the process of planning a new scheme which will begin within the next two years.

 The remaining 31% of respondents (33 companies) state that they do not have a scheme and they do not foresee a scheme being in place in the next two years.

 The main reason provided by those companies who do not have a scheme is that the business activities of the organisation do not fit with the framework of an apprenticeship/traineeship scheme.

 An estimated 350 young people are predicted to join the industry each year over the next three years (including 2012), as apprentices or trainees across the 107 respondents.

 Among the respondents who currently have an apprenticeship/traineeship scheme, 78 different schemes were identified. A further 13 schemes have been predicted to start within the next two years.

 The majority of the apprenticeship/traineeship schemes are focused on attracting school leavers, therefore the minimum age for most schemes is set at 16 to 17 years and the minimum qualification required to enter a scheme is Standard Grade or GCSE level.

 The respondents have indicated that the Mechanical discipline will be the most sought after discipline over the next three years. This is equal to 119 people of the estimated 350 young people likely to join the industry.

 The research suggests that an apprentice or trainee is most likely to obtain either an SVQ/NVQ Level 3 or HNC qualification on successful completion of an apprenticeship or traineeship.

The main Conclusions and Next Steps based on these findings can be found on pages 14 and 15.

Introduction

The OPITO Study of Apprenticeship/Traineeship Schemes in the Oil and Gas Industry was conducted in collaboration with the Robert Gordon University as part of a Knowledge Transfer Partnership agreement. The output of this report will assist industry in planning the development of its next generation of talent.

It is widely acknowledged that these schemes DO provide new ‘raw’ recruits with the pre-requisite knowledge and skills to equip them to move into the industry and operate competently and safely. Whilst there is a general consensus that more apprenticeships/traineeships are needed in the industry there is a real disparity between the numbers applying and those recruited. Therefore, it is

vitally important that there is better understanding of the ‘real’ industry demand

rather than the ‘perceived’ demand.

This is the first holistic study to be conducted and the findings will be of benefit to the industry as next steps and solutions can be determined through informed intelligence. The methodology for the collection of data was by on-line questionnaire.

This study focused on information captured from companies falling under three main categories as follows:

1. Companies with an Existing Apprenticeship/Traineeship Scheme

The aim was to obtain details of schemes currently available in the industry, to understand the existing schemes in the industry and the future focus of these schemes.

2. Companies with Potential New Schemes within the Next Two Years

The aim was to obtain information on schemes currently at the planning stage. This information will help to identify and understand potential new schemes and their focus.

3. Companies that do not have a Scheme

The aim was to understand the reasons that prevent companies from having apprenticeship/traineeship schemes. This was further analysed to identify barriers facing companies interested in implementing a scheme.

1.

Breakdown of Respondent Companies by Industry

Sub-Sector

The majority of the respondents to this study are Engineering, Design and

Maintenance companies (29%), followed by companies classified as ‘Others’

(26%). These include companies providing engineering, support functions and laboratory testing services (Figure 1-1).

Figure 1-1: Breakdown of Respondent Companies by Industry Sub-Sector

14%

29%

4% 6%

3% 6%

12%

26%

Breakdown of Respondent Companies by

Industry Sub-Sector

Production and Exploration Operators

Engineering, Design and Maintenance Companies Duty Holders

Subsea Companies Drilling Companies Well Service Companies Manufacturing Companies

2.

The Status of Apprenticeship/Traineeship Schemes

The focus of this study was to obtain information on the number and type of apprenticeships/traineeship schemes in the oil and gas industry, thereby assisting with the identification of any gaps. 57%of the respondents (61 companies) have stated that they currently have at least one apprenticeship/traineeship scheme in place while an additional 12% (13 companies) have stated that they plan to introduce a scheme within the next two years (Figure 2-1).

Of the 31% (33) companies that stated they do not have or do not plan to introduce a scheme (Figure 2-1), the respondents indicate that an apprenticeship/traineeship scheme is not suitable for all business activities.

Figure 2-1: Status of Apprenticeship/Traineeship Scheme

Of the 57% of respondents who stated they currently have a scheme it was found that 28% are engineering, design and maintenance companies, followed by companies providing support functions (21%) and production and explorations operators (20%). A similar examination of the 12% of respondents looking to introduce a scheme within the next two years shows that 38% of these are engineering, design and maintenance companies. Figure 2-2 provides a combined view of Figures 1-1 and 2-1.

Currently has a scheme

57% Will be

starting in the next two

years 12%

Does not have a scheme

31%

Status of Apprenticeship/Traineeship

Schemes

Figure 2-2: Status of Apprenticeship/Traineeship Scheme by Industry Sub-Sector

Engineering, design and maintenance companies make up the sector with the highest number of existing apprenticeship/traineeship schemes (28%), and they are also intending to introduce the highest number (38%) of new schemes over the next two years (Figure 2-2).

31% of respondents have stated that they do not currently have a scheme, with

the majority of these (39%) classified as ‘Others’ (Figure 2-2).

Key points of this section:

57% of the respondents currently have an apprenticeship/traineeship scheme.

12% state that a new scheme will be introduced within the next two years.

31% do not have a scheme and do not foresee a scheme being in place within the next two years.

The majority of the respondents are engineering, design and maintenance companies, who will be introducing 38% of new schemes over the next two years.

0% 10% 20% 30% 40% 50% Others (Providing support functions, etc)

Manufacturing Companies Well Service Companies Drilling Companies Subsea Companies Duty Holders Engineering, Design and Maintenance Companies Production and Exploration Operators

Percentage of Respondents

In

d

u

st

ry

Su

b

-Se

ct

o

r

Status of Scheme Based on Industry

Sub-Sector

3.

Existing and Future Apprenticeship/Traineeship

Schemes

The online questionnaire which was used to obtain information for the study was sent to a representative sample of 382 companies across the oil and gas industry. The respondents identified that there are 90 individual schemes, run by 61 different companies. However 13 of these schemes are managed by OPITO and ECITB as part of the Upstream Oil & Gas Industry Technician Training Scheme (UOGITTS). Therefore, these have been counted as one scheme, bringing the total number of schemes to 78 (Figure 3-1).

Of the 61 companies running an apprenticeship/traineeship scheme, 45 have one scheme, seven companies have two schemes, five companies have three schemes and four companies have four schemes running concurrently (Figures 3-1)

Figure 3-1: Number of Companies with one or more Existing Schemes

13 companies indicate that they will potentially introduce 15 new schemes within the next two years. Of these companies, 11 intend to have one scheme and two companies intend to have two schemes. Respondents indicated that two of these potential schemes would be part of the UOGITT Scheme (Figure 3-2).

0 10 20 30 40 50

1 2 3 4

N

u

m

b

e

r

o

f Co

m

p

an

ie

s

Number of Schemes

Number of Companies with one or

more Existing Schemes

Figure 3-2: Number of companies with one or more Potential Schemes

From the information provided it was estimated that the oil and gas industry will have approximately 100 different apprenticeship/traineeship schemes across 74 companies by the year 2014.

According to the information provided by the respondents, in the next three years, starting from 2012 (Figure 3-3), the industry can anticipate an average of 350 members of the workforce joining the industry as apprentices or trainees each year.

Figure 3-3 : Estimated Intake from 2012 to 2014

0 2 4 6 8 10 12

1 2 3 4

N u m b e r o f Co m p an ie s

Number of Schemes

Number of Companies with one or

more Potential Schemes in the next

two year

Other schemes UOGITTS

0 20 40 60 80 100 120 140 E le ct ri cal Me cha n ical Pro ce ss Op e ra ti o n In stru m e n ta ti o n Craf ts De si g n Pro jec t C o n tro l Ot h e r E sti m ate d In tak e Discipline

Estimated Intake from 2012 to 2014

The respondents have indicated that, in the next three years, there will be a high demand for apprentices and trainees in the Mechanical discipline with an average of 34% (119 people) entering the industry for this discipline. This is followed by Electrical (Figure 3-3).

Figure 3-4 : Estimated Intake from 2012 to 2014 for Existing Schemes

An analysis of the demand for each discipline of existing schemes is represented in Figure 3-4. The overall trend is visible for schemes currently available, where Mechanical is the discipline in highest demand, followed by Electrical and Design.

Figure 3-5 : Estimated Intake from 2012 to 2014 for Potential Schemes in the Next Two Years 0 20 40 60 80 100 120 E le ct ri cal Me ch an ical Pro ce ss Op e ra ti o n In stru m e n ta ti o n Craf ts De si g n P ro jec t C o n tro l Oth e r E sti m ate d In tak e Discipline

Estimated Intake from 2012 to 2014 for

Existing Schemes

2012 2013 2014

0 5 10 15 20 25 E le ct ri cal Me ch an ical Pro ce ss Op e ra ti o n In stru m e n ta ti o n Craf ts De si g n Pro jec t C o n tro l Ot h e r E sti m ate d In tak e Discipline

Estimated Intake from 2012 to 2014 for

Potential Schemes in the Next Two Years

Examination of the preferred discipline for potential schemes beginning in the next two years indicates a slight difference from the overall trend. The highest demand remains for the Mechanical discipline, followed by Electrical. This is closely followed by Operations which is not shown in the overall trend (Figure 3-3 and Figure 3-3-5).

The trend for the next three years remains almost constant with regard to demand for each discipline, regardless of whether the scheme is currently in place or if it is a new scheme which will be introduced over the next two years. A variance is visible for the Instrumentation discipline, where the requirement for the Instrumentation apprentices/trainees in 2013 and 2014 is almost half of the requirement for 2012.

Overall, the discipline with the least demand for an apprenticeship/traineeship scheme is Project Control. Companies indicate that there is unlikely to be any intake of apprentices/trainees to this discipline from schemes starting within the next two years and less than 5% of the total intakes will be for the project control discipline for existing apprenticeship/traineeship schemes.

Key points of this section:

On average, 350 people are likely to enter the oil and gas industry each year as apprentices or trainees over the next three years.

The highest demand will be required for the Mechanical discipline, followed by Electrical.

4.

Criteria for Apprenticeship/Traineeship Schemes

In the oil and gas industry, there are a number of different types of training programmes. Some have a recognised Modern Apprenticeship framework, while others consist of an accumulation of qualifications.

From the total responses, 69% (74 companies) were made up of respondents with an apprenticeship/traineeship scheme and respondents with a potential scheme starting in the next two years. Of these respondents, 62% (46 companies) have stated that the minimum age for potential candidates will be 16 to 17 years. The remaining 38% includes respondents who have stated the minimum age to be over 17 years and also those who have not specified a minimum age limit.

Figure 4-1 : Minimum Qualifications Required

The majority of the respondents (57%) have stated Standard Grade or GCSE as the minimum qualification required to enter an apprenticeship/traineeship scheme (Figure 4-1).

0% 10% 20% 30% 40% 50% 60% St a n d a rd G ra d e G CS E H ighe rs Ad v an ce d H ighers AS -Le v e l A-Lev e l H N C H N D H an d le d b y O u ts o u rce d p ar ty Ot h e r Pe rc e n tage o f R e sp o n d e n ts Minimum Qualification

Minimum Qualifications Required

Figure 4-2 : Duration of the Scheme

55% of respondents indicated that the duration of the apprenticeship schemes lasted for three to four years (Figure 4-2).

The majority of the apprenticeship/traineeship schemes begin training during the months from July to September.

Respondents have stated that an SVQ/NVQ Level 3 or HNC is the standard qualification an apprentice or a trainee is likely to receive on completion. 73% (54 companies) of the respondents have stated that apprentices will receive a recognised Modern Apprenticeship certificate/award at the end of the programme.

Analysis of existing schemes over the past three years (2009 to 2011), reveals that over 80% of apprentices or trainees who completed a scheme were recruited by their respective companies.

Key points of this section:

The minimum age for the majority of the schemes analysed is between 16 and 17 years.

The minimum qualification to enter a scheme is Standard Grade or GCSE. The average duration of a scheme is three to four years.

At the end of the scheme an apprentice or trainee is likely to receive an SVQ/NVQ Level 3 or HNC qualification.

0% 10% 20% 30% 40% 50% 60%

Less than 1 year

1-2 years 2-3 years 3-4 years 4-5 years Not specified

Per

ce

n

tage

o

f R

e

p

o

n

d

e

n

ts

Duration of the Scheme

Duration of the Scheme

5.

Reasons for Not Having a Scheme

As shown in Figure 2-1, 31% respondents have stated that they do not have an apprenticeship/traineeship scheme and they do not foresee a scheme being in place within the next two years. The reasons for this were investigated in the study (Figure 5-1).

The most prominent reason given by respondents is that their business activities do not fit with the framework of an apprenticeship/traineeship scheme. The next most common reason cited is the lack of resources to run an apprenticeship/traineeship scheme.

Figure 5-1: Reasons for Not Having a Scheme

Key points of this section:

The two main reasons for a company not to have an

apprenticeship/traineeship scheme are:

1. The activities of the company do not fit the framework of an apprenticeship/traineeship scheme.

2. Lack of resources to run an apprenticeship/traineeship scheme.

0% 10% 20% 30% 40% 50% Other

Limited resources (accommodation) offshore The functions of the company do not fit an

apprenticeship scheme

The company is unable to invest in an apprenticeship scheme

The training time is too long Lack of resources to run an apprenticeship scheme

Percentage of Respondents

R

e

ason

s for

n

o

t

h

av

in

g

a

S

ch

e

m

e

Reasons for not having a Scheme

Conclusions and Next Steps

The findings from this research reveal a realisation among oil and gas companies that there is a real need to invest in young talent and bring more appropriately skilled people into the sector in order to secure the skills needed for its future success.

Vocational programmes not only provide young people with the tools they need, they ensure trainees have the skills and knowledge that employers want. The

Scottish Government’s pledge to create 25,000 funded new modern apprenticeships each year provides the industry with a golden opportunity to improve future skills provision via the traineeship route.

The objective of the OPITO Study into Apprenticeship/Traineeship Schemes in the Oil and Gas Industry was to understand the current status of schemes, and how this information can assist the industry to increase the number of apprenticeships, if required within their current plans.

The key conclusions of this study, plus next steps, are:

 69% (74 companies) of the respondents have stated that they either currently have an apprenticeship/traineeship scheme or that they are in the process of planning a new scheme which will begin within the next two years.

This information will enable OPITO to discuss various options with these organisations in terms of how their plans can best be supported by government support agencies and funders.

 The remaining 31%of respondents (33 companies) state that they do not have a scheme and they do not foresee a scheme to be in place in the next two years. This information will enable OPITO to support companies who do not have a scheme but with the right resources would consider one.

 The main reasons provided for a company to not have a scheme is that the business activities of the organisation do not fit with the framework of an apprenticeship/traineeship scheme or lack of resources. This information will enable OPITO to:

a) discuss alternative options outwith the rigidity of a national

framework, which will enable these organisations to consider a different approach to bringing new blood into their organisation and the industry.

b) discuss with government funding agencies potential funding

support linked to Scottish Government priorities of enabling companies to take on young people

 An estimated 350 young people are predicted to join the industry each year over the next three years, including 2012, as apprentices or trainees across the 107 respondents. This information will enable OPITO to work collectively with industry, the college sector and government funders to support this growth prediction and to achieve economies of scale that an individual company and college cannot.

 78 different schemes were identified and a further 13 schemes have been predicted to start within the next two years. This information will enable OPITO to work collectively with industry, the college sector and government funders to support this growth prediction in order to directly fulfil the increasing skills demand.

 The respondents have indicated that over 80% of apprentices or trainees who had completed a scheme over the last three years have been recruited by their respective companies. The UOGITTS scheme has a success rate of recruiting 94% of apprentices into the industry, further investigation is required to identify why the number is lower for other schemes.

 The respondents have indicated that in the next three years there will be a high demand for apprentices and trainees in the Mechanical discipline, followed by Electrical. This information will enable OPITO to inform the national college and government system so that it can better enable the planning of supply of suitably skilled people to match the predicted demands of industry.

References

 OPITO Labour Market Intelligence Survey Summary Report. Available online at:

http://www.opito.com/uk/library/documentlibrary/Labour_Market_Intelligenc e_Survey_Report.pdf

4.

Criteria for Apprenticeship/Traineeship Schemes

In the oil and gas industry, there are a number of different types of training programmes. Some have a recognised Modern Apprenticeship framework, while others consist of an accumulation of qualifications.

From the total responses, 69% (74 companies) were made up of respondents with an apprenticeship/traineeship scheme and respondents with a potential scheme starting in the next two years. Of these respondents, 62% (46 companies) have stated that the minimum age for potential candidates will be 16 to 17 years. The remaining 38% includes respondents who have stated the minimum age to be over 17 years and also those who have not specified a minimum age limit.

Figure 4-1 : Minimum Qualifications Required

The majority of the respondents (57%) have stated Standard Grade or GCSE as the minimum qualification required to enter an apprenticeship/traineeship scheme (Figure 4-1).

0% 10% 20% 30% 40% 50% 60% St a n d a rd G ra d e G CS E H ighe rs Ad v an ce d H ighers AS -Le v e l A-Lev e l H N C H N D H an d le d b y O u ts o u rce d p ar ty Ot h e r Pe rc e n tage o f R e sp o n d e n ts Minimum Qualification

Minimum Qualifications Required

Figure 4-2 : Duration of the Scheme

55% of respondents indicated that the duration of the apprenticeship schemes lasted for three to four years (Figure 4-2).

The majority of the apprenticeship/traineeship schemes begin training during the months from July to September.

Respondents have stated that an SVQ/NVQ Level 3 or HNC is the standard qualification an apprentice or a trainee is likely to receive on completion. 73% (54 companies) of the respondents have stated that apprentices will receive a recognised Modern Apprenticeship certificate/award at the end of the programme.

Analysis of existing schemes over the past three years (2009 to 2011), reveals that over 80% of apprentices or trainees who completed a scheme were recruited by their respective companies.

Key points of this section:

The minimum age for the majority of the schemes analysed is between 16 and 17 years.

The minimum qualification to enter a scheme is Standard Grade or GCSE. The average duration of a scheme is three to four years.

0% 10% 20% 30% 40% 50% 60%

Less than 1 year

1-2 years 2-3 years 3-4 years 4-5 years Not specified

Per

ce

n

tage

o

f R

e

p

o

n

d

e

n

ts

Duration of the Scheme

Duration of the Scheme

5.

Reasons for Not Having a Scheme

As shown in Figure 2-1, 31% respondents have stated that they do not have an apprenticeship/traineeship scheme and they do not foresee a scheme being in place within the next two years. The reasons for this were investigated in the study (Figure 5-1).

The most prominent reason given by respondents is that their business activities do not fit with the framework of an apprenticeship/traineeship scheme. The next most common reason cited is the lack of resources to run an apprenticeship/traineeship scheme.

Figure 5-1: Reasons for Not Having a Scheme

Key points of this section:

The two main reasons for a company not to have an

apprenticeship/traineeship scheme are:

1. The activities of the company do not fit the framework of an apprenticeship/traineeship scheme.

2. Lack of resources to run an apprenticeship/traineeship scheme.

0% 10% 20% 30% 40% 50%

Other Limited resources (accommodation) offshore The functions of the company do not fit an

apprenticeship scheme

The company is unable to invest in an apprenticeship scheme

The training time is too long Lack of resources to run an apprenticeship scheme

Percentage of Respondents

R

e

ason

s for

n

o

t

h

av

in

g

a

S

ch

e

m

e

Reasons for not having a Scheme

Conclusions and Next Steps

The findings from this research reveal a realisation among oil and gas companies that there is a real need to invest in young talent and bring more appropriately skilled people into the sector in order to secure the skills needed for its future success.

Vocational programmes not only provide young people with the tools they need, they ensure trainees have the skills and knowledge that employers want. The

Scottish Government’s pledge to create 25,000 funded new modern apprenticeships each year provides the industry with a golden opportunity to improve future skills provision via the traineeship route.

The objective of the OPITO Study into Apprenticeship/Traineeship Schemes in the Oil and Gas Industry was to understand the current status of schemes, and how this information can assist the industry to increase the number of apprenticeships, if required within their current plans.

The key conclusions of this study, plus next steps, are:

 69% (74 companies) of the respondents have stated that they either currently have an apprenticeship/traineeship scheme or that they are in the process of planning a new scheme which will begin within the next two years.

This information will enable OPITO to discuss various options with these organisations in terms of how their plans can best be supported by government support agencies and funders.

 The remaining 31%of respondents (33 companies) state that they do not have a scheme and they do not foresee a scheme to be in place in the next two years. This information will enable OPITO to support companies who do not have a scheme but with the right resources would consider one.

 The main reasons provided for a company to not have a scheme is that the business activities of the organisation do not fit with the framework of an apprenticeship/traineeship scheme or lack of resources. This information will enable OPITO to:

a) discuss alternative options outwith the rigidity of a national framework, which will enable these organisations to consider a different approach to bringing new blood into their organisation and the industry.

 An estimated 350 young people are predicted to join the industry each year over the next three years, including 2012, as apprentices or trainees across the 107 respondents. This information will enable OPITO to work collectively with industry, the college sector and government funders to support this growth prediction and to achieve economies of scale that an individual company and college cannot.

 78 different schemes were identified and a further 13 schemes have been predicted to start within the next two years. This information will enable OPITO to work collectively with industry, the college sector and government funders to support this growth prediction in order to directly fulfil the increasing skills demand.

 The respondents have indicated that over 80% of apprentices or trainees who had completed a scheme over the last three years have been recruited by their respective companies. The UOGITTS scheme has a success rate of recruiting 94% of apprentices into the industry, further investigation is required to identify why the number is lower for other schemes.

 The respondents have indicated that in the next three years there will be a high demand for apprentices and trainees in the Mechanical discipline, followed by Electrical. This information will enable OPITO to inform the national college and government system so that it can better enable the planning of supply of suitably skilled people to match the predicted demands of industry.

References

 OPITO Labour Market Intelligence Survey Summary Report. Available online at:

http://www.opito.com/uk/library/documentlibrary/Labour_Market_Intelligenc e_Survey_Report.pdf