Skills shortages, water shortages, salaries and the price of water

November 19, 2008

The skills shortage, particularly for civil design and construction engineers, puts inevitable inflationary pressure on salaries as firms compete for talent. However as a professional you should not automatically expect a dramatic increase in salary when you next change jobs.  The main factor influencing salaries is actually the price of water and wastewater services.

In an increasingly corporatized water sector, the amount of money that will be invested in water and wastewater is largely determined by the potential revenue streams from the investment i.e. the price of water and wastewater services. The cost of supply is one factor, as is level of demand, but they all are all trumped by political imperatives and the decisions of regulatory authorities.

South East Queensland recently faced the prospect of running out of water, and as result engaged in the construction of a massive network of pipelines and reuse plants. The cost of capacity from this scheme is in the realm of US$5000/m³/d according to the October Global Water Intelligence report, as compared to $1333/m³/d for the average global desalination scheme.  The alliance contracting model and tight timelines on the scheme meant that professionals needed to be (and could be) hired whatever the cost. Consequently we saw a significant inflationary effect on salaries for design and construction engineers, making Australian salaries some of the highest in the world. I suspect it will also result in staff being laid off in the future because they will just be too expensive to be deployed on projects where cost is more important than timeliness.

The shortage of water created the political will to spend more on infrastructure, and that will be reflected in water prices down the line. That political will to spend more on infrastructure and charge more for water is only galvanized in the face of a crisis…so if you are looking to make the big dollars, don’t assume the global skills shortage will be enough to push up your salary…look for where the next crisis will be, and head there!


How globalised is the market for water professionals?

November 10, 2008

On one level, the water sector is clearly highly globalised. Multinational firms supply equipment around the world. Multinational design firms have global footprints, and French, Spanish and British firms provide design, build and operate services on every continent.

But how easy is it for water professionals to move internationally?

Even though the global design firms have a presence on every continent, in most countries domestic design firms are dominant…certainly in Australia the home-grown firms take away the bulf of the work.

I see a lot of movement on the UK-Gulf-Australia-New Zealand axis, and between the subcontinent and the gulf, and of course the European water giants like to have their people on the ground in every country they operate in. Beyond this I don’t see too much liquidity between countries. There is mysteriosly little flow of engineers into and out of United States, perhaps partly because of the largely closed-shop engineering certification system they run there.

Beyond the English speaking world, the language barrier starts to kick in. I am interested to hear how much movement there is between Spanish speaking countries and across countries within the Mandarin speaking world?

I think that the major factor in increasing the level of international movement will be the infrastructure cycle. Most governments will not spend significant money on infrastructure until there is a crisis, as we have seen in Australia. As countries around the world run into trouble with climate change, they will look to suck in talent from other parts of the world.

For those that are looking to develop a skill set that will take them around the world to different employers, I would say first of all you have two choices. Firstly engineering design is much more transferable than any other area. From where I am sitting, civil design engineers with pumps and pipes experience are highly employable and have good transferable skills. The other alternative is to develop a very specific skill set a high level in a particular technology or process which is increasing in popularity. The skill shortage in your area will then justify the effort of importing you from overseas.

Barriers like immigration regulation, local regulations and language mean that the globalisation of water is still in its infancy…but things may look very different in ten years time.


Career Equity

March 2, 2008

I have mentioned the idea of career equity previously, but I think that it justifies its own post. Career Equity is what you build up as you consistently add value as a professional. Just like a corporation, the value of your equity will fluctuate depending on how the market percieves the amount of value you can produce as a worker.

To carry on the analogy, your salary is your operational revenue, but like a company you also have to keep an eye on your balance sheet.

The career equity equation has a number of inputs.

  1. Acheivements: If you are a person who gets things done, and has a demonstrated history of success, then you will be in demand. Make sure that you never leave a role in an organisation without being able to point to some clear acheivements
  2. Education and Skills: It doesn’t have to be formal education, but in almost every professional field things change quickly. You have to keep on learning to stay ahead of the curve
  3. Keep your word: In my previous post I wrote about the social contract you enter into when you take on a new role. Make sure you complete your “contracts” so when people are thinking about hiring you they will be in no doubt that you will do what you are promising to do. The risk of hiring you will be reduced.

the employment “contract”

February 28, 2008

When you start a new job you usually sign a written contract. But this is not the most important contract you are entering into.

You have also agreed to a social contract with the line manager who hired you. You have  been hired to accomplish a certain task, or take on a certain set of responsibilities.

If you leave that company before finishing the task, or before the line manager has had a decent return on training you for the position then, you have broken that “contract” with your line manager.

Breaking this contract is what makes people perceive you as being a “jumpy” employee. They fear that the cost of hiring you may exceed the benefits.

You can move jobs every year, but if you have completed your social contract every time, a new employer will not perceive too much risk in hiring you.


mass career customisation

July 16, 2007

Cathleen Benko, Managing Principle of Talent at Deloitte (cool title…her responsibilities just cover the States as far as I can tell) was interviewed for a podcast on Deloitte’s new way of systematically introducing flexibility into the workplace. Worth having a listen to….find it here


Career and Age

June 19, 2007

While it is illegal to discrimate against employees on the basis of age in most markets, it is still an almost universal practice globally.

Virgin Airlines in Australia was recently found to have discriminated on the basis of age in their hiring practices. The authorities were not able to find any evidence of systematic discrimination during the hiring process, but instead did a statistical analysis of the age of all Virgin Airline employees, found a huge skew towards young people, and Virgin was found guilty.

This is unlikely to happen to many firms, and age discrimination will continue to be an issue for anyone over about 35. Employers now just use euphamisms like “over-qualified” to mean too old, or just use alternative reasons to reject candidates they feel are “past it”.

Being “too old” usually means that you are outside an age band which the employer considers typical for the given level of seniority. They may feel that an older person cannot be shaped as easily, or won’t be flexible enough to adapt to the corporate culture. If their qualifications and experience exceed that which is required, they will be concerned that the employee will get bored and discontented in the role. They may be scared that the employee will be more qualified than they are.

While we all know these concerns are unjustified, things are not going to change in a hurry, so it is important to factor this into your career plans. You may be 25 now, able to walk into a job any time you want in a talent short market, but in ten years time in the middle of a recession, things will look very, very different. It is hard to imagine, but make sure in 2017 you don’t find yourself across the desk from an interviewer (who was 15 years old in 2007), looking at you with contempt in her eyes and saying “we will call you”.

 Plan ahead. Make your you have a skill-set which will remain in demand, and keep it up-to-date. Don’t put yourself in a position where you have to apply for jobs you are “over-qualified” for.  Network heavily. Specialise, but have foresight, and if your specialisation will be extinct in ten years, make sure that you know what the next big thing is going to be in your industry.

Plan ahead!


Hot career planning tip

June 7, 2007

If you are considering whether or not to take a job, and you are having trouble deciding if it is the right move for you, try this trick.

 Put a date on your resume 3 years in the future, and write the job into your resume. Look at your resume with the opportunity included and examine how you feel. Are you happy to be that person? Does the job seem to lead naturally into the next role?

This will help you make sure that you are accepting the job for strategic reasons, not opportunistic ones.


a guest post on career management

May 29, 2007

Today we have a guest post from Lim Hodgson. Lim was a careers manager for many years at Charles Sturt University in Bathurst, Australia. Here are her ideas on career management, derived from her time advising university students.

Career Management is really a planning process. Planning a career can be an exciting journey of exploration and self discovery which involves learning about your talents and skills and exploring the resources and career opportunities that are available. You develop your ideas about your career, make decisions, set goals and take action to achieve them.

It’s not a “one off” activity, but something that you engage in at different stages of your life as your circumstances change and you look for different directions and opportunities.

There are four inter-related phases to career management; these are:

Self Awareness and Assessment – recognising personal skills, abilities, values and experiences which impact on career choice
 

Awareness – being aware of the job market, opportunities, possibilities and the world of work in general
 

Decision Making – setting goals and making decisions based on your understanding of both yourself and potential opportunities

Transition Making - acting on your decisions and developing skills such as networking, preparing job applications and job interview skills which will help you achieve your goals


Work Myths

May 24, 2007

http://blog.guykawasaki.com/2007/05/the_nine_bigges.html

 This is an awesome list of workplace myths from Penelope Trunk posted on Guy Kawasaki’s blog. It is mostly about career and how to manage it. Everything in here is great, but I particularly like myth no. 9


Every day is one step in your career journey

May 2, 2007

I can’t emphasise enough how important each day is in your career journey. First of all you have to know which direction you want to head in, but this is a topic for a different post.

Once you have worked out which direction you want to go you have to get there, and to paraphrase a tired old cliche, a journey consists of a lot of small steps. If you only try and change career direction when you change jobs or employer then you will have a lot of trouble. It is much easier to gradually change by slowly shifting responsibilities within your existing role and company. Put your hand up and jump up and down shouting “me! me!” when you see an opportunity that will take you a small step further to where you want to be. Suddenly be very busy when someone is looking for volunteers for a project that leads you in the wrong direction. Then when the time comes for you to make a more dramatic change, be it in role or employer, you will have the record of achievement to back you up in your application.