These are hardly fat and happy times for the electric industry. Utility stock downgrades have become common on Wall Street. As of early March, the Dow Jones Utilities Index had slumped nearly 20% from its value in March of 2002. A common utility response has been to cut its workforce, reducing costs by laying off workers or offering early retirement packages to trim payroll. That, in turn, has led to an aging workforce (because utilities aren't hiring new, younger workers), which means the aging electric utility infrastructure may or may not be getting the proper care.
Utilities are turning towards consulting or contracting firms for work, creating a greater demand for engineers and field crews outside the utility, in many cases, rather than within. Added to that is the fact that deregulation is splitting some utilities into distinct business units along the lines of generation, transmission and distribution, with new regional entities such as ISOs and RTOs cropping up to take on some of the things utilities used to do themselves.
The result is a growing awareness on the part of the industry that, challenging times notwithstanding, utilities have at least as great a need for qualified employees today as they ever have. The bad news is that although many companies realize and admit this, most say they cannot afford to hire anyone new. The good news is that those that can and do hire today are finding better value in the employee market.
Pockets of Hiring
Take, for instance, Georgia Power (Atlanta, Georgia, U.S.). Dennis Mize, a principal engineer in the transmission and distribution line area of the electric utility says his company has been in hiring mode for the past 18 months to two years. The company has been hiring civil engineers, mechanical engineers and electrical engineers, with an emphasis on civil engineers. Mize says a key driver has been the recognition that the company's work-force is aging. “Within the next seven years or so, many of our guys are going to be heading out the door,” he says. “We are trying to get people in now so we can do some training before that happens.”
Mize notes that the current job market is working to Georgia Power's benefit, by bringing in new applicants the utility might not have seen as recently as two years ago. In terms of college recruiting, he says, electrical engineering students have seen hard times hit the computer and electronics industry. “They [students] are looking at the power industry as maybe not as hokey as we once thought it was,” Mize says.
Mike Beehler doesn't seem to see it as hokey. An associate at Burns & McDonnell, (Kansas City, Missouri, U.S.), a construction company that does contract construction and design work for utilities, Beehler says the current “buyers market” for new and mid-level engineers works to his company's benefit. “Recent grads are not getting the job offers they have had in the past,” Beehler notes. “We as consultants or the electric utilities in general have a good opportunity to hire some very sharp people into this industry.”
Any utility that can afford to add staff today, Beehler adds, is likely to profit in the future, particularly as the economy rebounds. “The dot-coms and telecoms are absolutely in the tank right now, and that is why electrical engineers in particular should consider us,” Beehler noted. “We have a lot of power plants to build, and the power-delivery system in America needs to be significantly strengthened. It can be an attractive place to work. I have been in front of students at Georgia Tech and other schools, and they are interested. Not only is the transmission and distribution industry challenging, but it is fun to be a consultant too. A new grad could and should be very interested in this field.”
Or take the case of the Sacramento Municipal Utility District (SMUD; Sacramento, California, U.S.). SMUD is on something of a mini hiring binge this spring, as it staffs up for the construction of a new 1000-MW power plant 25 miles (40 km) to the southeast of the city. “We are hiring everyone from superintendents to project managers to inspectors to get the project kicked off,” says Mike Himmah, a senior office specialist in SMUD's human resources department. Himmah says that beyond hiring for that specific project, SMUD is doing replacement hiring for older and retiring workers. “Our average age is close to 50, so we know we have to replace some retiring workers,” he says.
Trouble Down the Line
Selected pockets of hiring aside, many worry that the utility industry today is not keeping pace and, in the long run, will suffer from its current preference for short-term results, often accompanied by massive layoffs, at the expense of long-term investment and employment.
“There are several problems, one of which has been sporadic hiring by any given utility company over the last 15 years,” says B. Don Russell, regent's professor of electrical engineering at Texas A&M University and past president of the IEEE's Power Engineering Society. “All utilities have significant gaps in their workforce, but they either cannot or will not do anything about it.” Utility management today, Russell says, appears bent on controlling costs at all cost.
George Karady, an electrical engineering professor at Arizona State University, says he has heard much the same. “A senior manager at a utility told me, ‘Look, we have financial problems. We are not making money, we are losing money. I know that is not good, but what do you want me to do? I have to show the investors profits, or at least not losses,’” Karady says.
The U.S. Department of Labor (DOL) predicts employment opportunities in the electrical engineering field will “grow about as fast as the average” for all occupations through 2010, meaning growth in the 10% to 20% per year range. That said, the DOL figures are for electrical engineers in all fields. They say nothing about utility hiring practices.
The IEEE runs a job site for recent college graduates and mid-career engineers looking to make a change. Mike Buryk, manager of recruitment advertising for the site, says he is not seeing much activity in the power engineering space. A glance at December 2002 statistics, for instance, showed about 2% of all electrical engineering job openings were in the power engineering field.
Bob Dent, executive director of the Power Engineering Society, says he has heard anecdotal evidence that power planning engineers are in demand, particularly on the part of ISOs and RTOs. General hiring, he says, appears to be down, and engineers who are already at a utility are being asked to do more with fewer cohorts. “Their jobs have expanded or changed to meet the times,” Dent notes. “Con Ed used to have a 345-kV underground specialist. You are not going to see that any more. Everyone has to be more of a generalist is being pushed to expand their capabilities.” By and large, Dent adds, utilities have “cut to the bone and maybe even a little bit into that.”
Russell says that type of cutting portends dire prospects not only today but well into the future.
“There is a marked decrease in the number of U.S. citizens going to graduate schools in general, and into engineering in particular,” he claims. “The pool is getting smaller, the environment tougher and with reputation as an issue, utilities are increasingly at a disadvantage to get the best students.”
His prescription for utilities: continue hiring, no matter what. “First, never stop hiring,” Russell says. “No matter what you are doing in your company, don't stop hiring. You can lay people off but still keep hiring on the other end. Second, if you cannot offer stability, you have to offset that with premium pricing. Third, recognize that if you put engineers in more responsible positions and reward graduate degrees, you would have more career engineers.”
Russell also would like to see utilities revamp internship or co-op programs so that students can get some real-world, hands-on experience while in school, but admits that he does not see that happening in the current economic climate. Another thing he would like to see is utilities that would seek out and reward engineers for work with new technologies. Again, though, he sees little chance of that happening in the near-term future.
“Virtually no utilities are trying to stay on the cutting edge of new technologies,” he said. “The people who used to do that now rely on manufacturers to do it for them.”
Jack Casazza is a retired electrical engineer and IEEE Life Fellow. He spent more than 40 years working in the utilities industry, first as a lineman and later as a systems planning engineer at a large electric utility in New Jersey. Today, as president of the American Education Institute, Casazza writes books and gives lectures nationwide on electric system development and electric power policy. He says overall hiring will not pick up until utilities change their mindset and begin to focus on long-term system reliability and stability rather than short-term financial results.
“There is a tremendous need for engineers who can do system design, who can tell you what a system should look like 10 or 20 years from now” Casazza says. “I do not see, however, anywhere in our restructured organizations the mechanism for attracting this type of talent.”
James R. Dukart is a contributing writer based in Minneapolis, Minnesota, U.S.