The Human Capital Challenge
The maritime industry is facing a human capital crunch that threatens to disrupt the industry as well as the supply chains that depend on it for their operations.
While shipping has been the cornerstone of global economy for at least a millennium, In last 4-5 decades some fundamental changes have challenged the industry on sustainability of human capital.
International Chamber of Shipping estimated almost a doubling of the demand of seagoing officers between 2005 and 2015. In 2021 estimated shortage of 26 thousand officers by 2026.
Roots of the problem
On the supply side, the charm of seeing new places has become insignificant due to nature of port calls and many other occupations such as IT and Technology offer greater opportunities to see the world.
At the same time maritime is no longer the attractive occupation that guaranteed a high remuneration and swift career advancement opportunities.
The supply of qualified personnel has also been impacted by the shortening of the average tenure of seagoing engineers. For Indian engineers, this has been around 10 years while similar shortening of tenure has occurred for engineers of other nationalities.
Imagine training someone for 4 years in an engineering college, giving him 4 exams before he becomes a Chief Engineer, and then losing this engineer in 1-2 contracts of 6-7 months of sailing as chief engineer.
While attractiveness of an occupation impacts the supply side of human capital the demand side has become a victim if its own regulations For example gradually the experience matrix to sail on tankers for the senior seagoing officers has become daunting to manage.
Imagine if a hospital put limitations on its surgeons to have performed a certain number of operations before they could treat patients! Or a doctor had to go for an exam before they became head of surgery! What a disastrous impact it would have on the availability of trained medical professionals for the healthcare industry.
Implications and the way forward
These serious occupational policy issues are being left to chance by all stakeholders alike be it the regulating bodies, training establishments, cargo owners, ship-managers, ship-owners, etc., alike.
The current focus on green shipping, environmental impact assessment, optimal fuel consumption, etc. will become irrelevant if the current shortage of seafarers continues. It’s simple maths and common sense!
Shortage of seafarers during COVID-19 has given a taste of what it means to have a sustainable human capital strategy for seafarers. Last 2 years, I interviewed over 250 masters and chief engineers from all major supplying nations. It is evident the seafarers supply shortage is looming large and if urgent steps aren’t taken, will lead to severe disruption in the industry and the global economic system.
While we can solve the industry problem in its entirety, let’s work as much as a we can, towards building a sustainable human capital for the maritime industry.
Contact Krishan Sharma.