The Grid Optimization Blog

Utilities Face Massive Brain Drain

The utility industry is losing legacy brain power at a rapid rate and it’s not yet in the position to compete with other “more exciting” and higher paying industries to attract the best and brightest.

When I got my first job as an engineer at a utility I didn’t give a thought to benefits or job satisfaction – and certainly not retirement. This was in 1970, the United States was in a recession and jobs were scarce. Before going into graduate school I had all sorts of job offers but not now. And then a position opened up at Pacific Gas and Electric Co. (PG&E) in the San Francisco Bay Area. I figured any old port in a storm so I applied and was hired. My plan was to work for the utility for a year or so and then move on to more exciting things when the economy picked up.

I remember a fellow engineer telling me I could just hop in the saddle and ride it to retirement. I knew that wasn’t going to be me.

But then we had children, a new car. We bought a house. And I was finding the work fascinating – particularly after PG&E’s R&D department was formed and I was part of it.

And of course, there was the job security – I never saw anyone fired or laid off.

Eventually the R&D department was disbanded, my job became ho-hum. I had offers for more exciting work elsewhere and I took one. I had 27 great years at the company. But there was no succession planning at my level so I took a lot of experience and knowledge with me when I walked out the door.

But the little piece of company value that was lost when I left is nothing compared to what’s going to slam the industry in the next few years.

A recent article in Forbes points out the looming industry crises in the article: Embattled Utilities Face 'Talent Storm'

“Almost half of the engineers employed by power and utility companies will become retirement eligible this year, according to analysts from Deloitte Consulting, and venerable old electric companies are finding it increasingly difficult to attract new talent.”

The article quotes Garth Andrus, a partner at Deloitte Consulting: “We’ve got the skilled talent shortage, we’ve got mass retirements, we’ve got rapidly developing new technologies and skill needs, we’ve got a lot of people competing for existing employees…”

The article goes on: “Utilities that grew up burning fossil fuels at power plants and sending electrons one-way across copper wires now must cope with an exodus of aging employees who worked under that paradigm, a perplexing influx of data from the smart grid, competition for business from renewable energy and competition for talent from sectors, like tech companies and the automotive industry, that were never seen as competitors before.”

Of course, this news isn’t new. Last year we even conducted a reader poll to see how many folks were held to their job mostly by the benefits and were waiting to leave when the Affordable HealthCare Act went into effect. You can still take the poll and see the ongoing results at http://tdworld.com/polls/featured-poll-will-obamacare-let-you-leave

So here’s the take away:

The utility industry is losing legacy brain power at a rapid rate. On top of that, companies need non-traditional utility talent to support new IT and communication needs brought about by smart grid investments and the pressure of rapidly expanding distributed energy resources. But utilities are not yet in the position to compete with other “more exciting” industries to attract the best and brightest.

Can the utility industry make an internal culture shift to help keep existing resources and attract new talent? And can it do it fast enough to avoid what the recent Forbes article refers to as falling off the cliff?

Does your company offer enough work satisfaction, perks and other benefits to keep you on the job when the green pastures of retirement beckon? We’d like to know. Take our reader poll -  What will it Take to Keep You On Your Job?

Discuss this Blog Entry 1

Dave Yang (not verified)
on Apr 24, 2014

I would agree with the gist of this article. Having begun my utility oriented career in 1974 with Pacific Power & Light Company, I have witnessed the many changes and can clearly see the brain drain.

Not only having an engineering degree, but an MBA in marketing, and having spent about 27 years in sales/marketing, my opinion is that part of our problem is "promotion" of the industry as a career path.

My youngest son, being somewhat of a "captive audience", is a case-in-point. I encouraged him to be one of the first graduates at our local university in a major called "Electrical & Computer Engineering". Graduating next month, I was able to connect him with someone who will be employing him in the HVDC world, and in a department that is looking to expand into FACTS as well.

Having been in sales/marketing so many years, I am trained to discern "features/benefits", and have highlighted these with my son. Of course nothing is 100% for sure, but we have a grasp on the probabilities.

Had I not "promoted" the utility industry to my son, he has not been exposed to this industry from any other source. Our utility industry is not one that has any clear expertise in the area(s) of "marketing/promotion". Having worked in electric utilities for 13 years, and compsring it to 27 years in private industry, the differences are glaring. Utilities "don't know what they don't know". By and large, utilities, have not had a need for any expertise in promoting careers. As mentioned in the article....utilities were analogous to job security. This is a new world. The new generation generally has a view that their careers will be one of constant change. An electrical engineer at Intel recently told me that, "..... being in the high tech world, we all expect to be laid off at some point in our career.....",

To have any success, utilities will have to first realize they have a "blind spot", and then they need to focus some effort at turning this around. Unfortunately, as more utilities are becoming "balance sheet" profit centers, such as the growing stable of utilities owned by Warren Buffett'
s Berkshire Hathaway, utilities are becoming known as "way points", or temporary opportunities for resume enhancement and springboards for better opportunities elsewhere.

So, personally, I believe it will get much worse before it gets better. And we have not even begun to discuss the lack of incentives for young people to establish the math/science foundation in our K-12 system to even begin the pursuit of engineering degrees.

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