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Sunny Industry with a Chance of Clouds

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A Lubes’n’Greases survey of lubricants industry workers revealed that, overall, employees are happy and optimistic about the industry, but peel away a layer or two, and signs of stress cracks begin to appear. Worries are plentiful, ranging from a greying workforce and attracting a new generation to an industry that Millennials view with contempt to new government regulations.

Managers are also closely eyeballing bottom lines as sales volumes shrink and mergers and acquisitions continue apace.

Its an interesting time to be in the business, Pete Andrich, vice president of human resources at Calumet Specialty Products Partners, observed during a recent interview.

LubesnGreases 2019 Workplace Trends Survey, conducted with recruiting firm ABN Resources, was sent to more than 9,000 lubricants industry professionals globally. Of the 336 responses, 162 came from the U.S. and Canada. This article focuses on those North American participants.

The survey responses were compiled by Adetiq, a United Kingdom-based data processing firm that is fully compliant with the European Unions General Data Protection Regulation.

Respondents worked in a variety of roles, including sales and marketing (57 percent); laboratory, research and development, and technical management (31 percent); plant and operations management (4 percent); and other roles (8 percent). Seniority levels ranged from top-level executives (5 percent) and directors (13 percent) to managers and non-managers (40 percent each).

More than half of respondents had spent over 20 years in the industry, while 17 percent had five years or less under their belts. About 29 percent had anywhere from six to 20 years of experience.

The vast majority of lubricant professionals who responded to the survey are content in their current positions, with approximately 60 percent responding they are either very happy or happy. Happiness reached across all levels of experience, pay and job titles, but nearly 70 percent of the very happy employees were 20-plus year veterans of the field.

But one recruiter was a bit skeptical of the findings, claiming them to be a bit optimistic. Its hard to gauge happiness in the business. Management likes to tell everyone what is wrong with the industry and gripe about regulations, said Christopher Melillo, a managing partner and practice leader of the Energy, Oil and Gas section of Kaye/Bassman, a Plano, Texas-based recruiting firm.

With that said, only 3 percent of respondents replied they were dissatisfied with their current position. Those in the industry are very passionate about what they are doing, Melillo noted. Thats why there are so many consultants in the industry-retire on a Friday, go back as a consultant the next Monday.

Many respondents noted that they appreciate the global nature of the business and that they find lubricants to be an interesting market in which to work. A smaller number cited competitive salary and benefits as the most positive aspect of the industry. One respondent with more than 20 years of sales and marketing experience noted, Pay always seemed to be very good.

Indeed, over half of the workers who responded to the survey make more than $100,000 per year base salary, and 8 percent make $200,000 or more. Forty-four percent expect a bonus of more than a tenth of their salary, and 23 percent of respondents will receive more than 20 percent in bonus incentives.

There are, of course, areas where lubricant businesses can improve. When asked how companies could better support their employees, 43 percent of respondents wanted more training opportunities, while one in three would like to see better mentorship opportunities. Respondents desire to receive more recognition for their work rang in at 41 percent.

Nearly half of respondents replied they would benefit from management (41 percent) or leadership (50 percent) training.

Even though their workplaces arent perfect, only 19 percent of respondents said they see themselves leaving their current employers within two years.

One perk that nearly a fifth of survey takers wish companies would offer is flexible working hours. The head of one lubricant manufacturer said offering flexible working hours is key to his business keeping employees long term.

Texas Refinery Corp. President Pat Walsh said flex time helps offset other benefits the Fort Worth-based company cannot afford. We cant match the pay some of the other companies offer, but we are flexible with our work hours, and that is something to women who are mothers, he observed.

Despite the majority being happy in their positions, many respondents expressed worries about the future of the industry. When asked what was most frustrating about working in the lubricants business, respondents answers varied. Some noted that the industry is slow to adapt or change, while others pointed to the specters of company mergers and eroding markets. Still others are concerned about a lack of good management or career advancement opportunities.

However, those frustrations havent dampened respondents hopes for whats coming down the pike. Nearly three-quarters said they were either very confident or confident in the future of the lubricant industry.

While respondents also expressed concerns about job security, recruiters and industry leaders said this is a job-seekers market. To hire in this market now, you have to pilfer someone from the competitors, said Walsh, explaining that in the Dallas/Fort Worth area, an unhappy employee can have another job with greater pay within two or three days.

Calumets Andrich said the job market is so strong that companies must have a strong value proposition for employees-benefits, salary, career growth and culture.

Even a strong value proposition doesnt ensure that talent will stay, recruiters and company heads said. I am just speculating here, but younger people-early 30s to mid-40s-are just job jumping now, said Walsh. By contrast, several of TRCs employees have worked for the company for more than five decades.

If someone gets five years under their belt, they tend to stay in the industry, Andrich said, adding, People who grew up in the business, stay in the business.

Nearly half of those responding to the survey said they are concerned about being able to hire younger workers. The brain drain worry is not new. In December 2007, Wileys Natural Gas and Electricity newsletter warned of the adverse effect. The talent management problem in the oil industry as a whole is not just an HR issue: Knowledge, not assets, will be the source of future value growth in the sector, and a shortage of well-qualified professionals will constrain the abilities both to grow in scale and to compete in an even more crowded field, wrote Bob Orr and Bridget McVerry, attorneys in the oil industry.

Melillo compared the qualified workforce shortage to a game of reverse musical chairs: Too many moving chairs and not enough bodies.

Andrich said the lubricant industry is mature, both in worker age and innovation, and that may keep some younger people away. People typically stay in the industry, which creates an older workforce, but also there is not a lot of innovation. Not a lot is happening with base oils or lubricant technology, he said.

He reported that Calumet has formal and informal mentorship training, and skills training is offered to employees who are interested in new roles. However, he believes that within five years a younger workforce will arrive, one filled with Millennials and Generation X workers as more Baby Boomers retire.

Melillo predicted that recruiting qualified scientists and engineers will become more difficult in the future, as many recent graduates are going into bioengineering.

Women made up just over 16 percent of survey respondents. Industry officials and experts said the lubricants industry is opening to women, but it is still considered a mans world. A lot of women arent entering the field, said Melillo, and both executives and recruiters are asking why.

Some in the industry are hoping national efforts to attract women to math and science fields, known as STEM-science, technology, engineering and math-is successful. However, they admit, the push is still in its infancy, meaning hiring from that generation is years off.

Of course, not every company reflects the overall industry gender balance. Walsh at Texas Refinery Corp. said about half of the leadership at his company are women, including the chief operating officer, the chief financial officer and the vice president of lubricant sales in North America.

The second-most cited fear is that of new legislation disrupting the industry. Over a third of survey takers view future regulatory restrictions or increasing public opposition to the industry as a looming threat.

Another potential-some would say current-industry disruptor that 22 percent of respondents named is new technology and artificial intelligence. Specifically, experts highlight the fact that the use of big data is making its way downstream from the larger oil and gas industry to the lubricants industry. More and more companies-big and small-are hiring data analysts, who scour mountains of data searching for ways to reduce costs.

The new [data analyst] position comes as companies are looking to streamline ways for smarter, more efficient ways of producing products, said Doug Wearley at CSI Recruiting in Denver, Colorado.

Will data analysts replace engineers? Thats the million dollar question, he said. I dont know if this trend is a good thing or a bad thing. But anytime someone loses his job, its a bad thing.

Calumets Andrich echoed Wearley, saying, Its a position growing throughout the industry as we are trying to get more business intelligence through big data.

At Indianapolis-based Calumet, data mining is increasingly important in commercial and operational areas. It is here to stay, said Andrich, as data mining helps companies understand customers habits and identifies profitable operations.

The rise of electric vehicles, which will have a considerable impact on the engine oil market, only came up among 8 percent of respondents. This isnt surprising since, as one industry expert pointed out, the lubricants business wont start to worry about electric vehicles for at least another decade.

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