While plans to build billions of dollars worth of petrochemical plants, gathering and transportation pipelines are set for the next decade, there is concern that labor shortages in crafts, trades and design technicians could raise costs and delay commissioning of these important projects. Among those in short supply are valve engineers, piping engineers and designers, and according to William G. Beazley, who spoke at a recent gathering of valve professionals, the shortage could be called a skills crisis.
Beazley is executive director of the Society of Piping Engineers and Designers (SPED) and said that part of the problem in attracting recruits to the industry comes from the cycles of boom and bust common to the process industry. These cycles send mixed signals to high school seniors and others deciding their professional path in life.
Demand vs. Supply
Beazley said that piping design continues to be a highly prized and compensated profession. SPED estimates that, worldwide, there are 100,000 piping designers or engineers practicing as piping designers. They make starting wages of $2.50 an hour in India, but that skyrockets, up to $125 an hour or more, with critical experience in active and competitive locales. In piping, as in other disciples, decisions frequently are made with multi-million dollar consequences, so it is imperative to have highly skilled and experienced designers from the outset.
A study from the National Petroleum Council (NPC) says, “A new college engineering graduate requires approximately 10 years of experience and training to attain the necessary credentials to provide technical innovation and leadership. Designers in EPC typically require a three- to four-year investment, heavily focused on in-house training utilizing design technology.”
This is a huge investment, so in the past, said Beazley, it has been more economical for EPCs to keep bidding up the pay for older staff. The problem now is that this force of experts is retiring, so EPC firms are paying huge sums to drag them out of retirement for big projects. “The pipers get big bucks for a few more years and the EPC companies avoid facing the inevitable. However,” he said, “they are hollowing out their value-added expertise that lands the contracts in the first place. If they rent their expertise, eventually, they will not own it.”
While the firms do own the patents, the past designs, the management systems and the internal standards that make their designs the best, Beazley wondered what that will mean when no one is around who designed that plant, can use the software with deep understanding, or select the standards appropriate for the right conditions. “Those are powerful tools in the hands of people who don’t know how to use them. It’s like fancy race cars with student drivers.”
Beazley said, “After years of bottom line punishment by Wall Street, corporate bean counters cut training to the bone. Cutting out training in EPC companies is like cutting out maintenance in a plant. Nothing happens at first but later the problems begin cascading to disaster. “
While community colleges do produce graduates with generalized training with a discipline focus, Beazley said this discipline focus often tracks research fads, like solar power, global warming or mechatronics. It can take up to a year just to change the outline of a course and years to alter a degree plan.
“The effect is that entrants alternately see huge salaries and massive layoffs, newbies face huge barriers to entry in the field, and educators cannot forecast opportunities for programs,” he said. “Employers are forced to choose between huge training cost burdens at site or fractional training costs overseas.”
Beazley discussed four mechanisms that could help the industry head off what he calls “this endless cycle of mixed signals, an aging workforce and increasing barriers to entry.”
1. Improved recruitment of entrants and students
“It’s easy and cost effective to improve opportunity signaling to entrants and students,” said Beazley. “Just let them see you. One way is hire them on as interns for the summer or part-time work. They get a look at you and you get a low-cost look at potential recruits. Consider taking the 12th man pledge, where every 12th man on each team is a soon-to- be credentialed intern or fresh graduate. When they see what you do, they’ll want to do what you do.”
Another approach is to incentivize or subsidize employees to serve as instructors at local institutions. Rather than viewing teaching as the last refuge of the incompetent, view it as candidate recruiting, community outreach and corporate goodwill. Teaching tells entrants that your field is understandable, learnable and fun.
2. Just-in-time training
For busy employees, training must be done, said Beazley, “just-in-time.” The proliferation of cheap video hardware and software makes it very cost effective to publish tips and briefs about anything. He specifically addressed valve, actuator and control vendors when he said, “Videos are not just for features and benefits but for how to design, specify, install and repair. Screen recorders can capture how-to’s for important applications, explanations and other subjects. Video clips will be the new corporate knowledge base.”
For that critical hands-on training, professional development should occur on-site. This can range from the “supplier fair” to the demo van and the “lunch and learn.” There is nothing like getting your questions answered by a live person and forming relationships for future consultation.
Beazley stressed the critical role of mentors. “This is precisely the mechanism of knowledge transfer that makes task experience possible. Most of the industry specific knowledge is NOT contained in textbooks,” he said. “It is passed from professional to professional through one-on-one advice, criticism and guided work assignments. The best corporate cultures emphasize staff development. “
3. Reward credentials
“Make it a visible policy to reward credentials,” urged Beazley. “You get paid for what you can do and credentials document that. Credentials earn credibility with clients when business is good and ensure diversity for market share when things turn south. An employee in school means free access to what they know until graduation.”
Besides formal courses and degrees, said Beazley, it’s important to offer certification. A certification is a formally tested set of skills and knowledge. The test is the key: Just attending a workshop is not enough. Certification means that candidates have shown they have the listed skills on tasks or tests or both.
Certified skills have another benefit. “It puts a floor under expectations of staff competence,” said Beazley. “Those stupid, newbie questions go away and the mentor’s and checker’s job gets a lot easier. You get more knowing nods in meetings, more correct execution of tasks. SPED estimates that PPD (Professional Piping Designer) certification is worth a year of on-the-job training. “
Automation of tasks and techniques is the surest way to capture knowledge in usable ways, according to Beazley. It is a capitalistic response to outsourcing to “high-value centers” in the developing world. The answer to low cost labor is no cost labor.
And while productivity improves with powerful software and hardware, it requires power users to run it. “We are replacing several ’B’ and ’C’ players with a handful of ’A‘ players,” said Beazley. “Recruit them, train them and reward them.”