www.icis.com30 | ICIS Chemical Business | 28 September-4 October 2015

SPECIAL REPORT RECRUITMENT SURVEY

ANDY BRICE LONDON

Recruitment remains a major challenge for the greying chemical sector. In June, in association with Korn Ferry, we surveyed readers to learn how the industry is managing the skills shortage

Bridging the talent gap

A recruitment chasm has been gradu-ally widening in the chemical industry these past few decades with companies, both large and

small, struggling to attract and retain new re-cruits. Whether at operational or business unit level, tempting people into the sector is proving increasingly difficult.

Despite offering the prospect of a healthy salary, job security and career progression, businesses are still finding it tough to culti-vate the skilled workforce that is clearly so vital for future success. In fact, many consid-ering chemicals as their chosen vocation spe-cifically point to concerns about remunera-tion and longevity.

The chemical sector has long suffered from misconceptions about safety and its impact on the environment, too – the latter proving par-ticularly pertinent to younger generations. Efforts have certainly been increased to im-prove the industry’s image in recent years, no-tably to appear more conscientious and less staid. This has led many to introduce corpo-rate strategies to improve outreach, education

FOR WHICH POSITIONS DO YOU FIND IT MOSTCHALLENGING TO ATTRACT THE RIGHT PEOPLE?

%

0

10

20

30

40

50

No challengesSeniormanagement

Middlemanagement

First timeentrants

and public relations in order to highlight the im-portance and relevance of chemistry to our every-day lives.

Yet finding suitable can-didates to fill key

roles remains a

struggle. The amount of choice facing today’s graduates only compounds the issue, with a diverse range of attractive jobs available in competing industries such as the energy sec-tor, healthcare and financial services.

Recent research carried out by ICIS and global recruitment firm Korn Ferry suggests that, despite its best efforts, the chemical sec-tor is perhaps still not proving as alluring as these alternatives.

FINDING THE RIGHT CANDIDATESAccording to the survey, some 87% of re-spondents cite challenges in recruiting the right candidates. Middle management proves most problematic in attracting the right people (46%), followed by difficulties sourcing first-time entrants (37%) and senior managers (26%).

The study considers how people perceive the chemical industry and what are seen as the main positives about working in the in-dustry. It also aims to identify which areas are finding it harder to recruit and whether your peers are likely to recommend a career in the chemical sector.

“It’s become obvious that several fairly large multinationals have made a conscious decision to reposition and rebrand”ALEX MARTIN Global sector leader, Korn Ferry

www.icis.com 28 September-4 October 2015 | ICIS Chemical Business | 31

IN ASSOCIATION WITH

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WHAT FACTORS INHIBIT RECRUITMENT FROM OTHER INDUSTRIES?

%

0

10

20

30

40

50

OtherLackof

suitably experiencedexecutive

recruitment agents

Lack ofvision

Salarystructure

Lack ofrelevant

expertiseof managers

in otherindustries

ImageCompanycultures

Lack ofpeople

who wouldconsider a moveinto the chemical

industry

“We needscience

graduates”mind-set

WHAT ISSUES AFFECT RECRUITMENT IN THE CHEMICAL SECTOR?

%

0

10

20

30

40

50

60

OtherLack ofdiversity

Lackof

excitement

Lack ofcareer

progression

Lackof

opportunityto make

a difference

Remunerationlevels

Poorengagement

with prospectiveemployees(graduates)

Maturityof

sector

Environmentalimage

Of those who took part, 89% admit they had considered joining other industries before deciding on chemicals. Both the energy sector – companies that are involved in oil & gas or power generation – and industrial manu- facturing prove popular alternatives, topping the polls with 34% and 33% respectively.

Perhaps unsurprisingly, it was these same two industries that are also

seen as direct competitors to the chemicals sector when competing for grad-uate and middle-manage-ment recruits.

The advent of shale gas, with its huge investment

and the rapid develop-

“The recent market movements have created a shift of a significant amount of executives with a chemicals background towardother materials markets”CHRISTOPHE VANDOORNEEMEA sector leader, Korn Ferry

ment of worldscale projects – particularly in the US – could well have influenced these results, suggests Alex Martin, global sector leader at Korn Ferry. The lucrative salaries and opportunities arising from new capacity additions are proving increasingly attractive to candidates.

The age-old perception that a job in the chemical sector is a job for life is dampened slightly by 35% of participants saying they had worked for 4-7 companies during their career, with 28% having worked for three. Only 13% had remained with the same firm.

Perhaps such high levels of movement can be attributed to increased M&A activity in re-cent years, with staff moving as companies are taken over or absorbed. Most of the respond-ents were from smaller firms – 51% working for companies with turnover below $499m.

In Europe, the Middle East and Africa (EMEA), there is a trend for movement between related sectors, says Christophe Vandoorne, EMEA sector leader at Korn Ferry. “The recent market movements have created a shift of a significant amount of executives with a chemicals background toward other materi-als markets, such as the building materials and packaging sectors, and vice-versa from these

www.icis.com32 | ICIS Chemical Business | 28 September-4 October 2015

SPECIAL REPORT RECRUITMENT SURVEY

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PART OF the survey uses the Net Promoter Score (NPS) index to ask how likely participants are to rec-ommend working in the industry.

The NPS asks questions based on a scale of 0-10; the higher the score, the more positive the response. Based on that rating, customers are then placed in three categories: Detractors, Passives and Promoters. Scores below 6 are classified as a Detractor (unlikely to recommend), 7-8 as Passive (satisfied but neither likely to promote or criticise), with ratings of 9-10 deemed Promoters (positive). By subtracting Detractors from the Promoters, a Net Promoter Score is generated. A higher score is an indicator of a healthy business.

The ICIS/Korn Ferry survey shows clearly that there was a de-gree of positivity about a career in chemicals. A quarter of the overall sample (27%) emerged as Promoters of the sector – a very good response. Although 23% are labelled Detractors, this still meant an encouraging NPS rating of +4.

The results show that there are more Promoters from the produc-ers of specialties (NPS = +17), pol-ymers (+10) and commodities (+8)

than intermediates (0) and distribu-tors (–5) – a not unexpected result given their respective margins and profitability levels. When recom-mending working in the industry, there clearly appears a strong cor-relation with how profitable you are; those making the highest gross margins are understandably more positive about the business.

Interestingly, NPS ratings are also significantly higher among those who have been in the chemi-cal industry for some time (see the table above). The longest-serving respondents vote very favourably about recommending a career in the sector, whereas new entrants are far more damning. Those with 21-25 years’ service score an over-whelmingly positive score of +22, a marked contrast to the –11 rating from the three-to-five-year group. These figures could be interpreted in various ways: either that it is tough to break into the industry and there is a steep learning curve that makes it hard to recommend a ca-reer in chemicals; or that knowl-edge, opportunity and remuneration improve markedly over time, making it far easier.

When the same question is posed on a regional basis, the score for those in Europe is fairly negative (–6), possibly due to the maturity of the region and stagna-tion in its various markets. Concern certainly seems to be growing about regulatory barriers, image issues and the disadvan-tage in feedstocks. Christophe Vandoorne adds that the current overall European economic climate is certainly affected by the recent refugee situation, which creates quite some concern on the market and may cause some constraint to the free movement of goods (the ‘Schengen agreement’ – an essen-tial component of today’s European economic model.)

Similarly, the Middle East does not fare well (–6), although it should be noted that the base size of the respondent group is low. The region has been severely affected by plunging oil prices and perhaps now feels a little vulnerable after so many years of success. Several projects have been shelved and financial results in the Gulf have been reasonably poor over the past year, notes Martin.

In contrast, the Americas emerge with very good results. South America receives an NPS rating of +21, which is bettered only by North America with +24.

Alex Martin suggests this may well be because of the excitement surrounding the industry since the emergence of shale gas as a viable feedstock alternative. A similar sur-vey five years ago may have seen a far less positive response, he sug-gests. Over the years, the chemical industry has lost a lot of talent to the rival oil and gas sectors, but there have been somewhat of a reversal with the advent of shale and the decline in oil prices these past few years.

“We’re seeing a lot of our cli-ents here taking advantage of that,” he says. “There’s a high lev-el of optimism [for the] long term about the Americas.”

With the first wave of major ca-pacities scheduled to come on stream in 2016-2017 and more projects being announced, this should provide a significant advan-tage for North America-derived pet-rochemicals over the coming decade, Martin says. ■

SATISFACTION RATINGS

NPS INDEX SHOWS POSITIVE SIGNS FOR CHEMICALS INDUSTRY

HOW LIKELY WOULD YOU BE TO RECOMMEND A CAREER IN THE CHEMICAL INDUSTRY? (RESPONDENTS ANALYSED BY LENGTH OF SERVICE)

less than 2 years 3-5 years 6-10 years 11-15 years 16-20 years 21-25 years 25+ years

NPS –6 –11 –1 –2 +10 +22 +8

Promoters (9-10) 29% 19% 23% 21% 28% 38% 29%

Passives (7-8) 35% 51% 53% 55% 54% 46% 49%

Detractors (0-6) 35% 30% 24% 23% 18% 16% 21%

NOTE: NPS = Net Promoter Score

markets towards the chemicals compa-nies,” he says.

The results also appear to show regional variations. Staff in Asia, for example, tend to change jobs more frequently, with rival firms often attempting to lure away the best talent.

Particularly telling, says Martin, are the responses to what are perceived as the princi-ple issues affecting recruitment in the chemi-cal industry.

As expected, environmental issues top the poll (53%), with the image of a dirty, polluting industry proving off-putting for potential re-cruits. The sector’s maturity, poor engagement with graduates, salaries, ability to make a dif-ference, career progression, excitement and diversity are also deemed negative factors.

WHAT SECTORS ARE YOU COMPETING WITH FORGRADUATE/MIDDLE MANAGEMENT RECRUITS?%

0

10

20

30

40

50

60

70

80

OtherPost-graduateresearch

Financialservices

Professionalservices

(consultancyetc)

Consumergoods

Otheradvanced

technologymanufacturing

Healthcare(biotechnology/

pharma-ceuticals

etc)

Otherindustrialmanufa-cturing

Energy(oil & gas/

powergeneration

etc)

28 September-4 October 2015 | ICIS Chemical Business | 33www.icis.com

IN ASSOCIATION WITH

HOW MANY COMPANIES HAVE YOU WORKED FOR?

%

0

5

10

15

20

25

30

35

16+11-158-104-7321Mean: 4 companies

WHAT ALTERNATIVE INDUSTRIES DID YOU CONSIDER BEFORETHE CHEMICAL SECTOR?%

0

5

10

15

20

25

30

35

NoneOtherFinancialservices

Post-graduatersearch

Otheradvanced

technologymanuf-

acturing

Healthcare(bio-

technology/pharma-ceuticals

etc)

Professionalservices(cons-ultancy

etc)

Consumergoods

Otherindustrial

manufacturing

Energy(oil & gas/

powergeneration

etc)

HOW CAN THE CHEMICAL INDUSTRY MAKE ITSELF MOREATTRACTIVE TO CANDIDATES?%

0

10

20

30

40

50

60

OtherFastercareer

progression

Improvedenvironmentalperformance

Improvedinnovation

Improvedremuneration

Improvedcareer

pathways

Greaterinvolvement at

school/universitylevel

Conversely, the questionnaire shows that the main attractions of a career in the chemical industry are innovation (60%) and career pro-gression (50%), followed closely by salary, travel opportunities and intellectual rewards. Frederika Tielenius Kruythoff, senior client partner, chemicals at Korn Ferry, points at the biggest attractions of the chemical industry. Innovation is key and biotechnology an area of very clear attraction.

INCREASING DEVELOPMENT GAPInterestingly, earnings and job potential appear on both positive and negative lists – suggesting some confusion among applicants. According to Vandoorne, the point on job potential can be explained by the increased gap between devel-opment efforts offered by various companies.

Korn Ferry’s market experience indicates that whereas many large organisations have be-come very sophisticated with regards to succes-sion planning, competency management and executive development programmes, a lot of others are still lacking traction on all of the above.

“We’re working intensively with many of the latter to help them bridge that gap,” Van-doorne says.

Martin observes that there has been a con-scious push to address the industry’s negative image for quite some time. One interesting ex-ample from the past is that of Unichema, which became Uniqema to avoid the use of the word “chemicals” in its name.

Other examples are German major BASF and US-based DuPont, which both now want to be considered science and engineering or-ganisations, while PPG is positioning itself as a materials company, AkzoNobel as a coatings specialist and DSM as a life science and mate-rial science company.

Firms are wanting to be less associated with the word “chemical”, Martin says. Such subtle repositioning could indeed help with many of these issues.

“It’s become obvious that several fairly large

multinationals have made a conscious deci-sion to reposition and rebrand,” he notes. “This is partly designed to increase the appeal factor to new talent and potential employees, as well as investors and the longer-term strate-gic notion of mitigating legal and activist exposure. It’s about image improvement.”

Nearly half those surveyed (44%) suggest that another hindrance to recruitment is the mindset that only science graduates are capa-

ble of filling certain roles. “This is consistent with Korn Ferry’s ob-

servations when dealing with clients,” adds Martin. “It’s an issue that we’ve seen in CEO searches; they question how they can put someone in charge of a large chemical organi-sation if they don’t have a chemistry or chem-ical engineering degree. Even if they’re already a proven CEO, it’s still very much an inhibitor.”

So how can the chemical industry make it-self more attractive? Education and greater in-volvement at school and university level gar-nered the most positive result in the study.

Outreach is certainly back on the agenda, says Martin, and the industry has been increasing efforts to head to the campus and engage more with young people.

Surprisingly, given the response to previ-ous questions, improving environmental performance is fairly low down the list. This possibly suggests that the industry thinks it is doing enough, he suggests.

“Companies seem to believe they are extremely conscientious already.” ■

For more information on Korn Ferry’s expertise in recruitment and training in the chemicals industry, visit kornferry.com