As crude prices came out of the doldrums in 2010-11, so have the pay hikes for petroleum geologists.
Over the past year, salaries for petroleum geologists for the year showed a weighted average increase of 7.9 percent, according to the annual AAPG Salary Survey.
This compares with a 5 percent overall increase in 2009-10 and a 2 percent increase the previous year.
Mike Ayling, of MLA Resources, who has conducted the annual salary survey for AAPG since 1981, said the largest pay increases came in the “high demand” groups with 10-14 and 25-plus years experience, with increases between 10 and 12 percent.
“These demographic groups entered the work force at times when demand for geologists was not as high (mid-1980s and mid-1990s) – but now they are at the point in their careers where they can be key players,” Ayling said. “And, they are getting paid for it because the companies are wanting to keep them.”
The industry has a two-generation history of hiring and paying a premium for new talent in the good times – and during bad times, not so much. This has given the industry curious gaps in the age and experience levels in the work force.
In fact, Ayling noted that nearly 44 percent of the respondents to the 2010-11 AAPG survey had over 25 years experience, indicating the extent of the aging of the work force.
Ayling continued there are other factors at work with the numbers, including reluctance on the part of smaller and mid-size companies to staff-up at the entry levels, “because they can’t spare the mature geologist the time to mentor the new geologist.”
Also, at the senior levels, there is not much movement from job-to-job due to “golden handcuffs” of accruing bonuses and retirement programs – as well as uncertainties in the economy causing individuals to be hesitant to make a move.
Ayling also noted the economic insecurity has caused companies to be slow in their hiring decisions.
The survey found that the 0-2 year experience levels showed a small increase, up 6.2 percent, but recently graduated bachelor level geologists had a difficult time finding work – and the few that did worked for lower salaries, depressing the overall average.
The 3-5 year and 15-19 year geologist groups showed little change, but these groups contained few individuals, Ayling said.
The 6-9 year and 20-24 year groups had between a 5 and 6 percent increase.
Ayling also noted the number of people in the demographic age groups can have a big bearing on both the marketplace and the salaries they are paid due to the supply and demand for their level of experience and expertise.
The annual salary survey is based on employed, salaried geoscientists and is based on salaries alone. It does not include bonuses, employee benefits, autos or other perquisites.
It does not attempt to include anyone whose compensation is in the form of consulting fees, retainers or overrides.
The survey also is based on U.S. salaries only, considered the “gold standard” for the industry. The measurement for international salaries for explorationists is virtually on a country-by-country, case-by-case basis, Ayling said, which makes statistical averaging non-productive beyond the boundaries of any specific country.
Ayling added that many ex-pats are paid U.S.-based salaries, while the national oil companies opt to pay compatriots on a different, lower scale.