In this article we discuss the changing dynamics in the UK offshore energy workforce and the ways in which RSM can support businesses with the current challenges. We value the input of Amanda McCulloch, Chief Executive of TMM Recruitment to this months article. Amanda is a recognised authority on executive search and senior leadership appointments, with particular expertise in the accountancy and finance profession across the north east of Scotland.

The changing workforce dynamics shaping UK offshore energy

The UK offshore energy sector has been a cornerstone of the economy for more than 70 years. Data from the OEUK Economic Report 2025 shows that the UK's integrated offshore energy sector, spanning oil and gas, offshore wind, hydrogen and carbon storage, currently supports 154,000 direct and indirect jobs, underpins the UK’s critical industrial capability and contributes over £25bn to the UK economy each year.

Yet the sector is entering a period of profound change. Ageing demographics, policy uncertainty and intensifying international competition are reshaping the workforce at a time when the UK is seeking to balance energy security, affordability and decarbonisation.

Failure to achieve a managed and pragmatic rebalancing of the UK's energy portfolio, encompassing continued domestic oil and gas production alongside the growth of low-carbon energy sources, risks not only workforce contraction but also the erosion of world-class capabilities that will be essential to delivering the energy transition.

Demographic pressures are becoming more acute

Successfully transitioning the UK’s energy system will require a new generation of workers trained and developed by the existing workforce. However, demographic trends show a growing succession challenge.

According to OEUK, the average age of a UK offshore worker is now 44. Around 41% of workers are aged over 50 and only 12% are under 30. Between 2022 and 2024, the number of workers aged 65 and over increased by 25%. These trends point to mounting skills and succession risks at a pivotal moment for the industry, with the potential to directly impact the implementation of the UK’s energy transition.

These findings are reinforced by the Engineering Construction Industry Training Board (ECITB) Workforce Census: Sectoral Report 2024 which analysed 94,680 engineering and construction workers across multiple sectors, including oil and gas.

Oil and gas workers represented 35.2% of the sample, down from 36.7% in 2021. The sector also recorded the study’s oldest workforce profile. Only 12% of workers were under 30, the lowest proportion of any sector surveyed, while 41% were over 50.

By contrast, renewables nearly doubled their share of the sample, rising from 3.4% in 2021 to 6.2% in 2024. 22% of renewables workers are under 30, compared with 17% across the wider industry, while the proportion aged over 50 is 8% lower than the industry average.

A survey by Platform London suggests workforce mobility is increasingly influenced by perceptions of future opportunity. Among North Sea oil and gas workers surveyed, 71% said they would consider a role outside oil and gas, while 27% were actively seeking to leave. Only 16% reported being happy in their current role, and 53% said working conditions have deteriorated over the last five years.

Retaining talent within traditional energy sectors during the transition is critical. Policymakers have an important role to play in articulating the continuing contribution that domestic oil and gas production will make during the transition period, helping to create confidence among current workers and encouraging future generations to view the broader energy sector as an attractive long-term career destination.

Skills can transfer, but what if people don’t want to move?

The House of Commons Committee report The Future of Scotland's Oil and Gas Industry noted that the government expects many clean energy roles to be filled by workers transitioning from oil and gas.

More than 90% of the oil and gas workforce is estimated to have skills that are transferable to offshore wind, hydrogen and carbon capture. However, clean energy projects have not grown fast enough to match the UK's oil and gas sector’s decline. This is limiting the number of transition opportunities available to workers looking to switch sectors.

Technical transferability alone does not guarantee workforce mobility. Workers must also consider pay, location, certification requirements, career progression and, perhaps most importantly, job security. Training and reskilling programmes will have limited impact if projects are delayed or employment opportunities aren’t available for newly qualified workers.

The challenge is therefore not simply one of skills transfer. It is also about ensuring the availability, timing and attractiveness of opportunities.

How can the UK create confidence for investment and workforce development?

Business investment thrives on certainty. Long-term, predictable energy policy is essential if companies are to commit capital, create jobs and position the UK energy sector as an attractive destination for both domestic and international talent.

Continued delays to projects such as Rosebank and Jackdaw are prolonging uncertainty and causing some businesses to defer investment decisions and workforce commitments.

This uncertainty weakens demand throughout the supply chain and makes it more difficult for employers to retain skilled workers, attract new entrants and justify long-term apprenticeship and graduate programmes. A stable and predictable policy framework, supported by timely regulatory decision-making, is therefore critical not only for unlocking business’ ability and willingness to invest in and strengthening energy security, but also for sustaining the highly skilled workforce on which the UK's future competitiveness depends. This in turn will help sustain the skills which are a crucial part of the UK’s future competitiveness.

Amanda McCulloch comments: "While certainty is essential for attracting new talent, it is equally important for nurturing the commitment and motivation of existing employees. As organisations increasingly look to technology to enhance productivity without significantly expanding headcount, employee engagement has become a key competitive advantage. Low engagement remains the scourge of productivity, while engaged employees are critical to helping businesses maximise technological advances, adapt to change and remain competitive."

What can the UK do to compete for international talent?

Another key consideration is that UK businesses are competing in an increasingly global talent market. Employers are dealing with rising employment costs like higher National Insurance contribution rates and increasing compliance obligations, including the Employment Rights Act 2025 and the new Fair Work Agency. Employing people in the UK has never been more expensive or complex.

As policy and fiscal pressures have intensified in the North Sea, there has been a noticeable trend of senior executives relocating to jurisdictions seen as offering more attractive investment conditions. The UAE in particular has emerged as a big beneficiary of this shift. Workforce migration is following too and this is further increasing competition for experienced technical and commercial talent.

While recent geopolitical developments have moderated this trend to some extent, professionals returning to the UK energy market are encountering a challenging employment landscape.

Amanda McCulloch: "Professional networks may have diminished over time, senior level opportunities remain constrained, and remuneration is unlikely to match that of international positions. Consequently, experienced leaders are rethinking traditional career paths and embracing more flexible ways of working such as interim and fractional assignments."

"Interim and fractional assignments can give local SMEs access to senior talent that may previously have been out of reach. They can also help keep valuable expertise in the region and allow it to be shared across the business community."

Tax implications of the international competition for talent

The reform of the UK tax regime for non-domiciled individuals (‘non-doms’) through the Foreign Income and Gains (FIG) regime in April 2025 may further discourage foreign nationals from relocating to the UK.

The new rules are less favourable than the previous regime in some respects, particularly for highly paid individuals with overseas investments and assets. While a longer-term consideration, exposure to UK inheritance tax under the new legislation is also a significant concern for many.

However, other aspects of the regime are beneficial. Some employers are supporting senior talent and prospective employees to understand the implications of a move, including during pre-relocation or pre-offer discussions.

The reluctance of overseas workers to relocate to the UK is prompting employers to explore alternative talent strategies. These include international remote working arrangements for roles that do not require a regular UK presence.

Both the OECD and EU are reviewing their international frameworks to reflect evolving working practices and simplify cross-border rules. Right now, though, any meaningful simplification is still some way off. For now, employers must continue navigating the complex tax, social security and employment law issues associated with international remote working.

The UK immigration system has also been subject to frequent changes to thresholds and sponsorship requirements. Continued political focus on immigration means employers have to be constantly ready to adapt.

Against this backdrop, reward strategy is a crucial focus area and employers may need to strengthen their employee value proposition. They could also consider targeted equity and incentive arrangements to attract and retain key talent.

How are flexible working and AI reshaping workforce economics?

Uncertainty is also influencing how organisations access specialist expertise.

Many businesses are increasingly turning to contractors, interim executives and fractional specialists. This allows them to plug capability gaps without permanently increasing fixed costs. While this approach can provide flexibility, organisations must carefully evaluate day rates, continuity risks and knowledge retention alongside any apparent payroll savings.

Amanda McCulloch: "In a workforce increasingly shaped by flexibility, businesses should view interim executives and fractional specialists not simply as a source of specialist expertise, but as a means of building lasting capability. The greatest return comes when their knowledge is transferred, their experience is shared, and their insights help develop the people around them, creating value that endures well beyond the assignment itself."

Artificial intelligence also has the potential to improve productivity, especially in applications such as predictive maintenance, workforce scheduling, recruitment and routine analysis. These can increase efficiency and support better decisions but require investment in data quality, governance, cyber security and workforce capability.

Skills England has identified predictive maintenance, process control and real-time analytics as areas that could have positive impacts across the economy. Addressing the current shortage of employees able to interpret AI outputs effectively and exercise appropriate oversight should be a priority area when it comes to workforce development.

Overall, what does the energy transition mean for workforce strategy?

The UK's energy transition is often framed as a question of technology, infrastructure and investment. Yet its success will depend just as heavily on people.

The data points to a workforce at an inflection point - an ageing demographic profile, increasing mobile, flexible and subject to growing international competition, all while the progress of the energy transition remains uneven in its delivery. Encouragingly, many of the skills required for the future energy system already exist within the current oil and gas workforce. The challenge is creating the conditions that allow those skills to be retained, developed and deployed effectively.

Business leaders and policymakers cannot separate workforce strategy from energy policy. Stable investment conditions, a credible project pipeline and clear long-term policy signals are essential to retaining capability, attracting new entrants and ensuring the UK remains competitive across both traditional and emerging energy markets.

The prize is significant, safeguarding one of the UK's most strategically important industrial workforces while positioning the sector to deliver the next chapter of the country's energy future.

How we can help your business

RSM's People Advisory Solutions specialists advise employers on global mobility, employment tax, reward, workforce strategy, cost management and compliance. We work closely with our employment law specialists to provide integrated tax and legal advice where needed.

We have extensive experience in the energy and natural resources industry, working with clients in the UK, Norway and globally in sectors spanning oil and gas, renewables and cleantech and mining and metals.

To discuss the impact of energy transition on your operations, please get in touch with Grant Morrison or your usual RSM contact.

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