Market Topics

Lab Managers


Fewer jobs. Senior people laid off. Limited.

Competitive. Talented people let go. Considerable downsizing. Declining investment in research and development.

Thats what you hear first when you ask senior technical managers in the U.S. Lubricants industry to describe todays job market in their field. The total number of jobs has shrunk because of mergers and acquisitions, Michael McHenry of Anderol in East Hanover, N.J., says, but its looking a little better now. There is some growing demand for more experienced people, but companies are also using more contract employees for temporary and short-term projects. The job market is very competitive, and for the near term its limited, says Jon Rummel, with Citgo in Tulsa; thats a plus for any company that might be hiring, he notes.

The market is tight right now, which is directly related to some very talented people being let go by the majors, due to mergers and acquisitions, Warren Oils Gary Whiteside, from San Antonio, says. This has provided an opportunity for the smaller companies to utilize this pool of experienced individuals.

A lot of senior people have been laid off, concurs Harji Gill at Pinnacle Oil Co. in Indianapolis, but nobody can afford senior people. Technical professionals are underutilized and undervalued. For the past 10 years few younger people have entered the market because of the layoffs, so theres a big gap, age-wise.

Another harbinger of job loss: While the overall response rate to LubesnGreases salary survey has improved from 30 percent in 2000 to 33 percent in 2004, only 78 of this years replies came from lab/R&D/technical managers, vs. 218 in 2000.


Comparing the results of LubesnGreases 2004 survey of laboratory, R&D and technical managers salaries with the first survey in 2000 illustrates this changing job market. All the technical managers responding in both years work for companies that manufacture lubricants.

Average salaries were reported at $76,000 in 2000 and $91,000 in 2004 (median salaries: $70,000 and $88,000, respectively), but the average technical managers profile has also changed. He is older (an average age of 48 in 2004 vs. 45 in 2000); has more experience (22 years vs. 17); has been with the same employer longer (13 years vs. 11); and supervises twice as many people (7 vs. 3.5). Hes also more likely to be male. The proportion of women responding as technical managers has fallen from 16 percent in 2000 to 10 percent this year.

Another significant change in the populations responding to the surveys is company size. In 2000, 42 percent of the respondents worked for companies with 500 or more employees. In 2004, only 28 percent do.

Only 68 percent of the 2004 respondents received a raise in the last 12 months, compared with 88 percent four years ago. And just 21 percent expect profit sharing this year, down from 27 percent in 2000.


The highest reported salary this year is $175,000; the lowest is $29,380. The average is $91,012 and the median is $88,000. This compares with an average of $85,636 and a median of $79,250 in 2002, the last time the survey was conducted.

Technical managers with greater longevity earn more: The average salary for managers in their current position five years or more is $96,267 (median: $88,200), while those in the current position fewer than five years average $82,107 (median: $85,500). This is different from the pattern reported in 2002, and its different from the pattern reported by plant managers and sales and marketing executives. For the latter job categories, managers who are more recent hires earned more, in some cases significantly more, than their peers who stayed in the same job longer.

Predictably, the more people supervised, the higher the managers salaries. For technical managers supervising five or fewer, salaries average $81,238. Supervisors of six to 12 average $104,075, and supervisors of more than 12 average $122,384.

Looking at differences by geographic region, the Southwest reported the fattest paychecks this year. Technical managers there averaged $126,250, followed by the Northeast at $101,452. In other regions, salaries averaged $80,000 to $86,000. (Because of the small number of responses from the Northwest, no data is disclosed for that region.)

Comparing salaries by company size shows a peculiar model that holds not just for technical managers but also for plant managers and sales/marketing execs. As you would expect, salaries are lowest in the smallest companies, with 10 or fewer employees (average $67,250). Average salaries rise to $77,245 at companies with 11 to 50 employees, and to $92,083 at companies with 51 to 100 employees.

But then technical managers average salaries drop back to $78,666 at companies with 101 to 200 employees, before climbing again to $88,224 at companies with 201 to 500 employees. Only at companies with more than 500 employees do technical managers earn more – an average of $113,386 – than their peers at companies in the 51-to-100 employee category.


Technical managers in the lubricants industry are not alone in experiencing job market erosion. According to the American Chemical Societys 2004 annual survey of over 10,000 of its U.S. members salaries and employment status, 3.6 percent were unemployed as of March 1 of this year (a record high) and an all-time low of 90.9 percent had full-time jobs. (The others were employed part time or on fellowships.) The percentage of unemployed chemists aged 50 to 54 seeking employment increased to 5.4 percent.

While 3.6 percent reported unemployment is low by national standards, its a very reliable indicator of the chemists job market, ACS notes. Anything over about 3 percent, it says, indicates a tough job situation.

The median base salary for all ACS-member chemists working in industry was $88,000 – identical to the median for technical managers in the lube industry. ACS reports the median for chemists working in industry who have bachelors degrees at $63,000; $76,000 with masters; and $100,000 with Ph.Ds.

Total employment in the chemical industry, excluding pharmaceutical manufacturers, dropped from over 700,000 at the end of 2000 to 595,000 this July, according to ACS, and the payrolls of many other manufacturing industries that employ chemists are also stagnating or drifting down. (See http://pubs.acs. org/cen/coverstory/8233 /8233salary.html for ACS Aug. 16 salary report in Chemical & Engineering News.)


Certainly mergers and acquisitions top most lists, although the churning seems quieter now, says Robert Gresham, director of professional development at STLE in Park Ridge, Ill. Mergers and acquisitions lead to higher levels of globalization, and this means new skills are required, he adds.

There is little or no growth to lube volumes, notes Citgos Rummel, but there are ever-increasing specification changes that will require human and technical resources. These specification changes are coming faster and faster.

There will be more jobs as time moves along. In about five to seven years, there could be a lot of hiring, says ChevronTexacos Jim McGeehan, or the industry could reinvent itself and not require as many people.

This is the most interesting of times, continues McGeehan, who is based in Richmond, Calif. On both the gasoline and diesel sides were dealing with after-treatment systems. We now have a chemical box with [proposed diesel oil] PC-10, and there are more efforts to reduce NOx . This is very interesting and challenging for researchers. In the past we had incremental improvements. This is a new dimension. So this is a good time to be in this industry, and it will get more interesting. When we start hiring, we wont have trouble getting recruits because the challenges are there.

One of the biggest trends in the metalworking and industrial fluid side of the lubricants business is chemical management contracts, says Greg Foltz of Milacron Marketing Co. in Cincinnati. This shifts work from the lubricant manufacturers labs to on-site, in customers plants. This is an area of growth: on-site technical people to work for chemical managers. Chemical management is growing, and expanding outside the automotive industry.


In the 1990s, if you were a chemist and possessed a skill set such as metalworking fluids formulation, it was common to find a new job opportunity in a matter of several weeks or months, says Ken Pelczarski of Pelichem Associates, Downers Grove, Ill., a professional recruiter who specializes in the lubricants and metalworking fluid industries. Since 2001, that same skill set remains highly valued, but you may still be looking for that new job opportunity six months, a year or even further down the road.

In fact, the average length of unemployment in 2003 was over 20 weeks, which is the longest period in 20 years. The outlook is becoming much brighter today.

There are fewer people in R&D now, says Gian Fagan of BelRay Co. in Farmingdale, N.J. But were expanding and looking for good candidates. In a smaller company, we dont do what ExxonMobil would consider basic research. Rather, were involved with production, marketing, technical services. We look for more than scientific knowledge; business knowledge and manufacturing experience are important to us. Knowledge of applications is the most valuable experience, but its hard to find.

For the last several years, opportunities … have been flat or declining as larger companies have merged. At ConocoPhillips, we also consolidated our technical staffs, says that companys Steve Tarbox. Today, that trend is definitely reversing.

Our staffs are heavily weighted with long-term, experienced professionals. Many are starting to hit retirement age, which opens up opportunities for younger hires. In the larger consolidated companies, our staffs are also starting to reap advancement benefits, the Houston-based Tarbox continues. We are definitely looking for degreed professionals and see that as our organization matures there are many opportunities for advancement into management or other areas that larger corporations can offer.

There are plenty of jobs for experienced formulators, says Milacrons Foltz.

There are great opportunities to create differentiated products, adds McHenry of Anderol.

This is a good industry if you want to be out and meet a lot of different people, concludes ChevronTexacos McGeehan. This is the career for a person who likes a broader scope. And we are successful: cars dont fail because of oil failures. Were keeping those trucks running a million miles.

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