Norway's Oil Industry Snaps Up Swedish Workers

26 March 2012

The collapse of Swedish car maker Saab Automobile AB last year put the Scandinavian country's once-proud automotive industry in the spotlight, and as the sector struggles, firms in neighboring Norway are seeing a chance to snap up staff.

Saab's bankruptcy and repeated cutbacks by its Chinese-controlled peer Volvo Car Corp. have released thousands of workers into the labor market in Western Sweden— workers Norway now hopes to lure to its booming petroleum industry.

With total investments in Norway's petroleum industry forecast at a record-high 186 billion Norwegian kroner (roughly $32 billion) this year, according to the national statistics bureau, engineers are in heavy demand. Norwegian oil-services company Aker Solutions ASA AKSO.OS +1.77% went looking for them in Gothenburg, once the hub of Sweden's automotive industry and the country's second-largest city. Gothenburg and its surroundings are not only home to Saab Automobile and Volvo Cars, but also to truck maker Volvo AB, and ball-bearings maker SKF AB SKF-B.SK +0.25% and a big university of technology.

Aker Solutions set up an office in the city last August and aims to nearly double its staffing this year to 60 for its subsea business after Norway last year made one of its biggest-ever oil finds.After starting out with 10 employees in Gothenburg in August,Aker Solutions now employs 33 people in the city, which is just 300 kilometers from the Norwegian capital, Oslo.

While Aker hopes to pick up people from a range of industries, including oil and gas, around a third of those it has employed so far were previously employed by Swedish car makers. The company hopes to take advantage of their expertise in areas like efficient mass production as the oil industry makes efforts to reduce field-development costs by moving away from tailor-made solutions.

"There is definitely information in the automotive industry that we take part of and learn a lot from that makes us more competitive as a company," says Jesper Ericsson, chief executive of Aker Solutions' Swedish unit. "It's the skills that drive us to Gothenburg."

Aker's Sweden-based engineers will focus on research and development, and and help out with a number of oil and gas projects around the world. in particular on developing subsea production technologies and deal with projects to extract oil and gas from the seabed, Mr. Ericsson said. Aker is currently installing a compression system on the seabed at the Asgard natural gas field for Norwegian oil major Statoil ASA STO +2.08% .

"An important part for Asgard is the development of compressors and pumps, and there Gothenburg can make a very positive contribution. There is competence from SKF when it comes to bearings, competence from the paper pulp industry when it comes to large process pumps and from the truck makers on large turbo engines," he says.Tormod Sveen, an engineer who worked for Volvo Cars for 11 years before joining Aker Solutions in January, says the biggest difference between the two industries is that technology plays a larger role in his new job.

"A car has a lot to do with the customer's experience when driving, like comfort for example…Now, focus is rather on the technical; there is no need to change a solution just because it isn't that good-looking. Design is based on what is technically best," he says.

"One is also more free to find solutions," he says. "At Volvo there are more limits both in terms of economy and in terms of technology."

Gothenburg-based YellowOffshore, a training company focusing on the Norwegian petroleum industry, is also seeking to capitalize on Sweden's new labor pool by educating Saab's former employees for a career in the offshore oil industry. The company has a client that needs 200 people in a first recruitment round and then another 150 people. YellowOffshore's head of training, Peter Eriksson, said Saab workers have skills in technology, electronics, hydraulics, assembly etc. that are useful for the offshore industry. "We're not the only ones to want their skills."

In the small town of Trollhattan—just 25 kilometers from the Norwegian border—a string of firms are turning their attention to the more than 3,000 people lost their jobs when Saab Automobile collapsed in last December after a three-year struggle to avoid bankruptcy.

Swedish engineering consultancy MVV International has just opened an office in the midst of Saab's deserted industrial park and has so far hired 15 of the car maker's former engineers, who will develop equipment for Norway's offshore industry. "It's with wonder we watch the growth we now experience in Norway," said Chief Executive Soren Gustafsson."The number of enquiries increases almost every day."

Managers from Trollhattan-based staffing company Jobbprofilen Sverige AB January travelled to Norway hoping to find 50 jobs for Saab's workers but in just one day,found about 1,500 jobs, many in the petroleum industry. "For every place we went to, we found more jobs. In the first place we came to they needed 80 employees and the last place we went to they needed 1,000 people," says Jobbprofilen Chief Executive Christian Akeson. "Adding everything up in the car on our way home, we arrived at some 1,500 jobs."