Workforce transition: From oil sands to LNG projects in Canada

Manley McLachlan's picture
Manley McLachlan, President, British Columbia Construction Association
Comments: 0

Manley McLachlan, President of the British Columbia Construction Association discusses Canada’s skilled workforce and the transition from oil sands to LNG projects.

Gastech News: Talking about the skilled workforce in the climate of the current downturn in Canada’s energy heartland and about bringing workers from the oil sands over to new LNG projects such as LNG Canada, Pacific Northwest LNG and Woodfibre LNG. Could you expand upon your perspectives in terms of this engagement?

Manley McLachlan: Absolutely. In British Columbia, we’re enjoying a very robust economy. With over $300bn in major projects scheduled, we’re seeing an incredible annual investment in ICI construction -- right now it’s estimated that about $82bn in projects are underway.

BC also enjoys a diversified economy. There’s a phenomenon known as “the sunshine factor” where people are retiring or looking for opportunities to the west coast of Canada over central and eastern provinces in search of warmer weather. Along with our proximity to Asia, that’s contributing to a migration westward, and creating demand for accommodation, especially in Vancouver. In the past people were moving out of British Columbia. Now we’re seeing the opposite trend.

The slight downside to this growth is the simple fact that our ageing workforce is contributing to current and future skills shortages. Two-thirds of the people that have the skills required to build LNG plants are over the age of 45, which means there’s a finite number of years left in their careers. That retirement is happening sooner rather than later. According to recent forecasts, it seems we’re going to be short of about 18,000 skilled tradespeople by 2018, largely due to retirements in the province.

The downturn in the energy sector actually helps alleviate some of this gap in BC's skilled workforce:  having workers from the oil fields available means we’re going to be able to backfill more of those retirees. That helps ensures productivity and provides on-site training and all of those important contributions that senior, experienced people provide. That’s giving BC a bit of a buffer against the major shock we were anticipating. Employers are able to take on more apprentices and provide on-site training.

We’re seeing a large number of tradespeople are moving to British Columbia and staying here to work rather than commuting to Alberta. We estimate that there were some 45,000 British Columbia families who moved to Alberta, and we see they’re moving back. The registrations for the enrollment in elementary schools in British Columbia, particularly in the lower mainland, are over the projections from a year ago and many of those families are back from Alberta. I believe this spike is causing a significant challenge to the education system.

In the construction sector, we verified this shift through a survey of the industry. Out of about 1000 respondents, nearly 50% of the respondents said they had hired someone from the Alberta oil fields in the past year. On Vancouver Island, that was slightly higher, with 56% of the respondents saying they’d hired someone from Alberta recently.

Another positive side to all of this change is that it demonstrates over time that we have a mobile workforce. It’s incumbent on jurisdictions in Canada to take steps to make sure we have an easy flow of workers from one provincial jurisdiction to another. I think it’s time to really start pushing Western Canada.

Join the Conversation: Will the current downturn in Canada’s traditional energy heartland bring workers from the oilsands over to new LNG projects? Leave a comment below.

Subscribe to our Newsletter  & Follow us @GasInteract.

Manley McLachlan, President of the British Columbia Construction Association attended the 2016 Canada LNG Conference & Exhibition in Vancouver. Find out more about next year’s event which will take place from 16-18 May 2017. The Canada LNG Conference & Exhibition is where the global LNG community meets to discuss and develop the future of Canada’s LNG industry.

More on Canada LNG: