Bringing down recruitment cost requires a long-term programme that needs to be backed up by a clear goal and innovation. The recruitment programme should work on the principle of reaching the prospective employee and completing the whole process of recruitment with speed. Here are 5 best practices that you can tap on to help reduce your recruitment cost.
1. Set a clear goal about your recruitment requirements.
Knowing what you want for your recruitment goals enables you to reach relevant candidates at the fastest pace. The Job Description (JD) is the first and most crucial step in the recruitment process. It needs to be prepared by a subject matter expert or the department manager. A casually prepared job details page, with either an unnecessarily long and unneeded set of requirements or an incomplete set of requirements, hinders the process. Ultimately, you may lose out on an employee who is genuinely good at the core requirement and instead appoint somebody with non-core skills.
2. Be visible to candidates on the web and partner with professional networking platforms.
Recruiters gain an edge by positioning themselves at the strategic platform where candidates, regardless of the level of work experience, visit for news related to their profiles, industry trends and new job opportunities. Using the internet to conduct interviews and tests brings down recruitment costs considerably. Candidates will also thank you for it, as they save travelling and lodging costs and time when recruitment is done online.
3. Use social media and leverage it for promoting job opportunities.
Having a good social media presence helps companies to understand employee requirements through interactions on social media pages. Prospective employees also get a feel of the company and when appointed, they are ready and enthusiastic to blend into the working ethos of the company. Twitter, LinkedIn and Facebook are great channels to reach out to active and passive job seekers, making recruitment more direct, accurate and less time-consuming..
4. Manage attrition and retirement.
The Oil and Energy industry is among the top 8 industries with the highest turnover rates. The most effective way to bring down recruitment costs is to always engage your existing workforce and prepare for attrition. There are various reasons why employees walk away from an organisation. According to a LinkedIn survey in 2015, 45% of professionals leave their jobs because of a lack of opportunities and 41% do so because of dissatisfaction with their senior leadership. A big chunk of recruitment costs comprises of filling vacancies as a result of attrition. Attrition, when managed with the right approach, can drastically reduce recruitment costs.
Another strategic move in the recruitment process is to plan in advance for upcoming retirements. Replacement for retired employees is completely different from regular recruitment. Because any retired employee, with valuable years of experience, leaves a much bigger set of shoes to fill in, recruitment for his/her replacement needs advanced planning in consultation with the retiring employee. An urgent notification for such a vacancy does not lead to immediate results.
5. Referrals always matter.
Word of mouth is a powerful marketing tool in a decision-making scenario like recruitment and career advancements. Referred candidates come with minimum recruitment costs and a great possibility of being long-term employees. They also feel more confident and assured when somebody known to them is already working for the company.
To effectively acquire quality talent in any industry, an organisation needs to find the right balance between technology and people analytics. Further one needs to optimise their recruitment processes, to deliver an engaging candidate experience, yet keep the overall talent acquisition costs low.
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The Permian is in desperate need of pipelines. That much is true. There is so much shale liquids sloshing underneath the Permian formation in Texas and New Mexico, that even though it has already upended global crude market and turned the USA into the world’s largest crude producer, there is still so much of it trapped inland, unable to make the 800km journey to the Gulf Coast that would take them to the big wider world.
The stakes are high. Even though the US is poised to reach some 12 mmb/d of crude oil production next year – more than half of that coming from shale oil formations – it could be producing a lot more. This has already caused the Brent-WTI spread to widen to a constant US$10/b since mid-2018 – when the Permian’s pipeline bottlenecks first became critical – from an average of US$4/b prior to that. It is even more dramatic in the Permian itself, where crude is selling at a US$10-16/b discount to Houston WTI, with trends pointing to the spread going as wide as US$20/b soon. Estimates suggest that a record 3,722 wells were drilled in the Permian this year but never opened because the oil could not be brought to market. This is part of the reason why the US active rig count hasn’t increased as much as would have been expected when crude prices were trending towards US$80/b – there’s no point in drilling if you can’t sell.
Assistance is on the way. Between now and 2020, estimates suggest that some 2.6 mmb/d of pipeline capacity across several projects will come onstream, with an additional 1 mmb/d in the planning stages. Add this to the existing 3.1 mmb/d of takeaway capacity (and 300,000 b/d of local refining) and Permian shale oil output currently dammed away by a wall of fixed capacity could double in size when freed to make it to market.
And more pipelines keep getting announced. In the last two weeks, Jupiter Energy Group announced a 90-day open season seeking binding commitments for a planned 1 mmb/d, 1050km long Jupiter Pipeline – which could connect the Permian to all three of Texas’ deepwater ports, Houston, Corpus Christi and Brownsville. Plains All American is launching its 500,000 b/d Sunrise Pipeline, connecting the Permian to Cushing, Oklahoma. Wolf Midstream has also launched an open season, seeking interest for its 120,000 b/d Red Wolf Crude Connector branch, connecting to its existing terminal and infrastructure in Colorado City.
Current estimates suggest that Permian output numbered around 3.5 mmb/d in October. At maximum capacity, that’s still about 100,000 b/d of shale oil trapped inland. As planned pipelines come online over the next two years, that trickle could turn into a flood. Consider this. Even at the current maxing out of Permian infrastructure, the US is already on the cusp on 12 mmb/d crude production. By 2021, it could go as high as 15 mmb/d – crude prices, permitting, of course.
As recently reported in the WSJ; “For years, the companies behind the U.S. oil-and-gas boom, including Noble Energy Inc. and Whiting Petroleum Corp. have promised shareholders they have thousands of prospective wells they can drill profitably even at $40 a barrel. Some have even said they can generate returns on investment of 30%. But most shale drillers haven’t made much, if any, money at those prices. From 2012 to 2017, the 30 biggest shale producers lost more than $50 billion. Last year, when oil prices averaged about $50 a barrel, the group as a whole was barely in the black, with profits of about $1.7 billion, or roughly 1.3% of revenue, according to FactSet.”
The immense growth experienced in the Permian has consequences for the entire oil supply chain, from refining balances – shale oil is more suitable for lighter ends like gasoline, but the world is heading for a gasoline glut and is more interested in cracking gasoil for the IMO’s strict marine fuels sulphur levels coming up in 2020 – to geopolitics, by diminishing OPEC’s power and particularly Saudi Arabia’s role as a swing producer. For now, the walls keeping a Permian flood in are still standing. In two years, they won’t, with new pipeline infrastructure in place. And so the oil world has two years to prepare for the coming tsunami, but only if crude prices stay on course.
Recent Announced Permian Pipeline Projects
Headline crude prices for the week beginning 3 December 2018 – Brent: US$61/b; WTI: US$52/b
Headlines of the week
The engine oil market has grown up around 10 to 12% in the last three years because of various reasons, mostly because of the rise of automobiles.
According to the Bangladesh Road Transport Authority (BRTA), the number of registered petrol and diesel-powered vehicles is 3,663,189 units.
The number of automotive vehicles has increased by 2.5 times in the last eight years.
The demand for engine oils will rise keeping pace with the increasing automotive vehicles, with an expected 3% yearly growths.
Mostly, for this reason, the annual lubricant consumption raised over 14% growth for the last four years. Now its current demand is around 160 million tonnes.
The overall lubricants demand has increased also for the growth of the power sector, which has created a special market for industrial lubricants oil.
The lubricants oil market size for industries has doubled in the last five years due to the establishment of a number of power plants across the country.
The demand for industrial oil will continue to rise at least for the next 15 years, as the quick rental power plants need a huge quantity of lube oil to run.
The industries account for 30% of the total lubricant consumption; however, it is expected to take over 35% of the overall demand in the next 10 years.
Mobil is the market leader with 27% market share; however, market insiders say that around 70% market shares belong to various brands altogether, which is still undefined.
It is already flooded with many global and local brands.