Recent visits to several chemical plants and industry events around Baton Rouge, Louisiana confirmed that workforce issues are a major concern for manufacturers of chemicals in that region.
In discussions in late February with plant leaders at chemical manufacturing facilities around the Baton Rouge area, the task of recruiting technically trained engineers, especially those with process experience, emerged as a significant challenge for chemical plant managers. Further, developing an engineering workforce for the future was highlighted as a shared priority for the chemical industry in general in the region.
Engineers and plant managers in the Baton Rouge-area facilities of Honeywell Corp. (Morristown, N.J.; www.honeywell.com), Rhodia (Boulogne-Billancourt, France; www.rhodia.com), Georgia Gulf Corp. (Atlanta, Ga.; www.ggc.com), and BASF (Ludwigshafen, Germany; www.basf.com), as well as the Louisiana Chemical Industry Association (LCIA) all pointed to staffing and workforce issues as major challenge and area of focus. Specifically, questions about how to fill the positions needed to run the plants with qualified engineers, and how best to develop a pipeline of technically trained workers for the future of the region were prominent topics.
For example, the challenging hiring climate for technically trained workers was expressed by plant leaders at Rhodia in Baton Rouge and Georgia Gulf Chemicals & Vinyls in nearby Plaquemine.
“The unemployment rate for engineers is virtually zero, so to hire someone, you probably have to steal them from somewhere else,” said Jim Armstrong, operations manager at Rhodia’s Baton Rouge plant.
Glynn Fontenot, manufacturing manager at Georgia Gulf, said finding and recruiting chemical engineers with experience is a recurring obstacle.
Tom Yura, BASF senior VP and site manager at the BASF chemical facility in Geismar, also emphasized the ongoing need for finding the right personnel and the difficulty felt in locating people with the special technical skills required for chemical manufacturing.
Gulf Region challenges
The several large chemical manufacturing facilities around Baton Rouge, and the large chemical and petroleum refining presence in the wider Gulf Region, creates both advantages and disadvantages when it comes to addressing workforce issues.
Joe McDougall, vice president for human resources at Honeywell Performance Materials and Technologies, says the Gulf Region presents a unique situation for his and other chemical companies. “The positive is that the amount of refineries and chemical companies in the area historically means there is more of the engineering talent we are looking for, so it’s a ‘target-rich’ environment — more than say, Wyoming, or some place with less of a concentration of this type of industry.”
In these types of environments, many candidates exist with the relevant skills, McDougall continues, but at the same time, “it seems all of the companies in the region are actively seeking a lot of the same talent, meaning that it’s also a ‘target-poor’ environment, because the demand for certain skills is momentarily outstripping supply in the market.”
McDougall echoes the observation that the unemployment rate for chemical engineers is quite low almost everywhere in the country.
Finding trained engineers becomes especially important as manufacturing processes become more sophisticated, McDougall says. Honeywell has explored many different methods to meet its hiring needs, including pursuing former junior military officers, who generally have great analytic and leadership skills, and also hiring people with adjacent technical degrees.
Future plans could be affected
The issue is not likely to get any easier in the near future, because of planned plant expansions and the retirements of older engineers. In the U.S., a number of companies are planning to expand to take advantage of the changing economics brought about by drilling in U.S. shale gas deposits. Many industry leaders think there simply may not to be enough engineers to operate the expansions that are planned.
ExxonMobil Baton Rouge technical plant manager John Kovich says his company anticipates an increase in retirements of older engineers in the next two years, as those who had delayed their retirements during the recession start to exit the workforce.
BASF’s Yura pointed out that because there is a “pent-up” group of pending retirements that were delayed by the recession, identifying and fostering new talent will be crucial in years to come.
As retiring engineers shift the workforce, efficiently transferring knowledge from experienced engineers and operators to newer workers becomes a real need. “How do you capture knowledge from experienced personnel and transfer it effectively and efficiently to newer workers? — That is a key challenge,” Yura says.
Workforce forecasting
The importance of workforce issues to the future of the chemical industry in the region is felt beyond the plant fences also. The topic was featured at the most recent joint meeting of the Louisiana Chemical Association (LCA; Baton Rouge, La.; www.lca.org) and the Louisiana Chemical Industry Alliance (LCIA). LCIA executive director Lisa Pulizzano says ensuring a sufficient workforce for future operations is of utmost importance to LCIA and LCA members, a large reason that she scheduled speakers from the Louisiana Workforce Commission (LWC; Baton Rouge, La.; www.laworks.net) and Louisiana State University (LSU; Baton Rouge, La.; www.lsu.edu) to address the meeting.
Curt Eysink of the LWC talked about his organization’s efforts to correctly forecast workforce needs for the chemical industry in the area, and to involve local community colleges, technical schools and four-year universities in developing programs to produce the workers needed for the industry.
Stephen Barnes, an economist at LSU, assists the LWC in forecasting by examining historical labor data, coupled with input from local industry on future plans, to arrive at information that correctly predicts need in terms of the numbers of people and type of education and training.
“Employment forecasts require industry input to be accurate, and to make revisions when needed,” said Barnes. He encouraged industry to participate in labor forecasting efforts that will benefit the region.
Impacts large and small
Chemical manufacturing plants experience the impact of staffing challenges in both small and large ways, and the companies’ responses can be variable. In many cases, plants are operating with leaner staffs than in the past, which puts more pressure on equipment maintenance models and process safety procedures. Lower personnel numbers in the plant overall require a predictive maintenance model, because there is no longer the same level of hands-on interface with the equipment that used to be there, explains Georgia Gulf electrochemical technology manager J.F. Accardo. For example, more hands-on experience in the past allowed engineers to tell if a motor was running hot by physically touching it, and possibly make a maintenance decision before equipment failure.
Also, to help address workforce challenges, plants seem to be generally using an increasing level of contract resources, even for day-to-day maintenance of the plants.
Other plant-manager concerns
Aside from ensuring the engineering workforce necessary for running process plants, facility leaders in Louisiana also are concerned about the new requirements that may be introduced in federal regulations promulgated by the U.S. Environmental Protection Agency, the U.S. Occupational Safety and Health Administration or other agencies. The impact of new federal legislation and regulations were cited as a top concern by Tom Yura at BASF.
In the case of Georgia Gulf, plant leaders like Accardo said they worry about the introduction of overly burdensome regulations that are driven by emotional reactions to certain industry practices. For example, opposition to hydraulic fracturing has been fueled more by emotional responses to the practice than by science-based evidence, Accardo says.
Regulatory changes also have a large impact on fuel prices in the U.S., and there is a desire on the part of many plant leaders to have regulations in place that will maintain competitive energy prices in this country.
In addition to finding engineers to run plant processes, the plant leaders pointed out that industrial construction contractors, needed for new builds and expansion projects, are likely to also be in high demand in the near future.