Blue skies for green industry workforce?
The UK environment industry is on the up, and so is demand for experienced personnel. There is stiff competition among employers to recruit the best candidates due to ongoing shortages of specialist skills, with many firms struggling to attract and retain staff whilst also keeping salaries in line with achievable fee rates. Sue Clarke takes a closer look at the current trends within the green industry's workforce, drawing on the results of our latest salary, benefits and careers survey, as well as insights from some of the country's leading environmental recruitment consultants.
A year on from ENDS' previous survey, when we reported on the beginnings of an upswing in activity in the environmental jobs market following a slower period during 2002/03 (ENDS Environmental Consultancy Directory 2004, pp 4-10), specialist recruitment agents are now describing the sector as positively buoyant. Lester Lockyer, senior recruitment consultant with one of the most established names in the business, Allen & York, claims that 2004 was "our busiest year by far, with a significant increase in turnover."
Adam Whitney of rival agency Evergreen Resources agrees that the environmental market is currently very strong and because of this, he says, it is attracting a growing number of new recruitment consultancies to the sector. "There is more competition, but we are still as active as we were and will always consider additional recruits," says Mr Whitney. Andy Kitching, recruitment consultant with newcomer Monarch Earth Sciences, indicates that its environment team has grown from two to six consultants in less than a year. Others report similar trends.
Nick Yates of longstanding recruitment consultancy BBT is not perturbed by the flood of new entrants, explaining that many of his firm's major client companies are now opting to take the "preferred supplier list" (PSL) approach - that is "wanting to deal only with big agencies who can supply all their [recruitment] requirements." Allen & York is similarly "putting a lot of effort into forging closer relationships with clients," according to Lester Lockyer.
PSLs are structured relationships offering benefits to both sides. While client companies ensure they get the first refusal of any new candidates coming through to the agency and inevitably lower rates when a placement is made, recruitment agencies gain a better understanding of their clients' needs and are more likely to match suitable candidates as new vacancies crop up. The latter is of particular importance in the environmental sector where many specialist skills are in very short supply.
Although skills shortages have plagued the sector throughout its rapid development during the 1980s and 1990s, Lester Lockyer believes that the lack of candidates with the right qualifications and experience in various environmental disciplines is now worse than ever. "Skills shortages have become more acute in almost every area. Those [areas] that were short skilled have become more so, and those that were not in the past are now becoming so," he says.
In the past, the limited field of expertise - coupled with a rising demand for environmental skills - has generally in favour of the environmental labour force, with salaries rising well above the rate of inflation for many years. 2004 is no exception, although average salary increases are not as remarkable as the hikes of the late 1990s. Adam Whitney of Evergreen Resources confirms that "salaries have increased but not dramatically."
Furthermore, recruitment consultants have noted a recent shift in emphasis in the main considerations of environmental professionals who are looking to move jobs. Lester Lockyer commented that, while "salaries on offer are generally expected to be good," career moves are increasingly being made based more on a hierarchy of personal wants and needs - salary being the base level, followed by the interview experience and general perception of the potential employer, and also what the new role offers in terms of project interest, workload variability and career satisfaction. He believes that employer characteristics are an increasingly important consideration and "there are lots of examples of not necessarily the best salary being accepted."
Recruiting and retaining staff in such a candidate-driven market represents a significant obstacle to the future growth of environmental companies - both large and small. Indeed, several of the biggest firms have addressed this very issue in their latest annual reports. It seems their main strategy in tackling the problem is to invest in promoting their image as an employer. Recruitment consultants also note that some organisations are becoming more flexible in their approach to employment contracts, often designing bespoke arrangements to increase their chances of attracting and keeping experienced personnel.
Although, paradoxically, the number of environmental graduates in the UK continues to increase year-on-year, most firms are still looking for candidates with several years' work experience - even at the most junior level. This means that new graduates still find it difficult to secure that first essential post and, as a result, many end up drifting into unrelated professions. However, there are signs that the situation is beginning to improve, leading Adam Whitney to conclude that "those with 9-12 months' experience under their belts now have more options available to them."
He says that some companies are coming round to recognise the potential effects that the loss of new young talent could have on their business and the sector in the longer term, and have begun to implement new graduate recruitment and training programmes, sometimes with postgraduate sponsorship as part of the deal. During 2004, one of the UK's largest environmental consultancies RPS awarded bursaries to 17 British university students in support of their continued educational and professional development within the specialist disciplines that make up its planning, transport and environment division - although this is still only a drop in the ocean compared to RPS' total UK workforce of just under 2,000.
Survey sample profile
Our online survey probing employment trends, career satisfaction, and salary and benefits packages within the environmental sector was conducted between 8 September and 20 October 2004 - our fourth such survey in as many years. This time, we received some 1,800 full responses from ENDS Report readers and visitors to the website making it our most comprehensive survey to date. Responses were split 66:34 between males and females. The vast majority (70%) of respondents work in the consultancy, government or regulatory field, while the bulk of the remainder are employed as environmental managers within industry.
Consistent with the results of our previous surveys, the make-up of this year's survey sample indicates that the UK environmental industry is characterised by a relatively youthful and extremely well qualified workforce - with 61% aged between 25 and 39 years, more than half still in either their first or second job within the sector, and almost all (94%) holding at least a first degree. A significant proportion also have a postgraduate qualification of some kind, 44% a masters degree and 11% a doctorate. Meanwhile, IEMA (Institute of Environmental Management and Assessment) registered environmental auditors constituted 8% of the sample, while chartered engineers accounted for just over 6%.
The majority of survey respondents claim to be "specialists" (37%), while 27% say that "middle manager" best describes their position, with only 8% of the sample claiming to work at "director" level. A common characteristic of large environmental consultancy firms in particular is an informal management hierarchy, which may be reflected in the fact that more than half of the respondents profess to no line management responsibility (54%). A further 29% say they have line management responsibility for five staff or fewer, while only 5% had responsibility for teams larger than 15.
Almost two-thirds (65%) of responses came from employees of larger organisations with more than 500 staff, while those working for small firms of less than 50 employees were in the minority (13%). However, growth in environmental teams - both large and small - is still very much in evidence with almost half (47%) of respondents indicating that the number of environmental professionals in their employer's organisation was increasing, and the majority of the remainder indicating that staff numbers were stable. Only 9% indicated a decline in environmental staff numbers, although the proportion was slightly higher among bigger organisations.
In terms of geographical location, almost a third of respondents work in London and the south-east of England. Nick Yates of specialist recruitment company BBT confirms that there is a much higher concentration of jobs in the environment field "within the M25" than anywhere else in the country. But he also notes a trend for new consultancy start-ups to be located in more rural areas in order "to benefit from cheaper rent, more space and the other lifestyle attractions." He says that in his experience they are often founded by senior consultants who have elected to strike out from larger firms and set up their own small consultancy practices.
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Skills needs
Those completing the ENDS survey questionnaire were asked to identify which specialist environmental skills were in greatest demand within their organisation. Waste management, environmental management and auditing, environmental impact assessment (EIA) and planning, and contaminated land and remediation emerged as the main sought-after skills, identified by more than half of respondents (see Figure 1). While recruitment consultants interviewed by ENDS generally agreed that these areas of the market have been particularly busy for them over the last year, niche activities such as asbestos management, quantitative risk assessment, integrated pollution prevention and control (IPPC), environmental management systems (EMSs) and renewable energy were also cited as emerging hot spots in the environmental jobs market.
Allen & York's Lester Lockyer has observed that with all the recent changes to UK waste management regulations, brought about principally by the landfill Directive and other EU legislation, the consultancy sector has experienced a boom in waste management contracts, thereby elevating demand and heightening competition for experienced personnel in this area. Meanwhile, Andy Kitching of Monarch Earth Sciences noted that contaminated land expertise has also been in strong demand, although he believes there are plenty of candidates for the basic level work.
Conversely, Eden Recruitment's Paul Seeley highlights EIA as a key sector where the supply of good candidates does not meet the demand. "There is a lot of EIA work coming into consultancies and a dearth of good people coming onto the market," he says. "The greatest demand is for individuals with experience of putting together [environmental] statements and combining project management skills with an area of expertise." As much as 90% of Eden's business is in serving the environmental consultancy sector.
Lester Lockyer agrees that there is a shortage of good EIA specialists at present, particularly in the fields of noise and ecological impact assessment. Health impact assessment (HIA) is another rapidly emerging field, according to John Waters, managing partner of consultancy Environmental Resources Management (ERM). "What is particularly interesting is that whereas the drivers for the growth in environmental and social impact assessment are legislation, clients are approaching ERM about HIA because they can see the benefits hugely outweigh the costs of the study. Demand is so strong that we have doubled the size of our team in the last nine months," he says.
There is evidence that environmental professionals are now becoming more savvy when it comes to identifying gaps in the market and brushing up their own skills accordingly. IPPC is highlighted as a case in point - whereas a year ago we reported on a lack of available candidates with IPPC or any other kind of permitting experience, recruitment consultants report a significant increase in the numbers coming through on their books in recent months.
Salary trends
The distribution of average salaries among those who took part in our survey by age, gender, seniority and primary job function is shown in Figures 2-4.
This year's results confirm a trend noted in our previous survey that women working in the sector generally start off on slightly higher salaries than their male colleagues when they are in their early twenties. But after the age of about 25, when males and females are just about neck and neck in terms of remuneration, the stereotypical gender gap in wages becomes apparent. Indeed, by the time the average male environmental professional reaches the age of 30 years he can expect to earn an average of 15% more than his female counterpart, and the gap further increases to a staggering 28% differential by the time they reach their mid-forties.
This pattern is characteristic of career breaks women may take when starting a family, but also reflects the general lack of females holding senior positions within the industry. However, the good news for female environmental professionals is that our survey indicates that the gap in salaries between the sexes in their forties is beginning to close.
Overall, some 56% of respondents earned between 20,000 and 35,000 annually, with only 1% earning less than 15,000. At the top end of the scale, 8% earned 50-75,000 and whilst very few survey respondents earned more than this, 16 individuals reported basic salaries of over 90,000. Evergreen's Adam Whitney expressed surprise at these figures: "Most appointments are in the 28-40,000 salary range. You are doing pretty well to get in excess of 60,000 as a basic salary - it's very rare," he says.
Salaries do also vary markedly depending on the individual's main area of specialism. Environmental managers working within the chemical and process engineering sectors were generally the highest paid. Their average salaries (at around 35,000) in the current sample were around 10% lower than in last year's survey, although the two samples are not directly comparable in size and make-up. Conversely, several typically lower paid disciplines have emerged with higher average salaries in this year's survey. These include resource management, air pollution, waste management, water and wastewater treatment, contaminated land/remediation and hydrology/hydrogeology.
Nevertheless, the overall effect has been a big reduction in the spread of salaries between different areas of specialism to just 4,000 (from 31-35,000). Recruitment consultants suggest that the picture is not a straightforward one. Paul Seeley commented: "A candidate with a masters in hydrogeology and two years genuine consultancy experience in the use of quantitative risk assessment packages can earn up to about 30,000. Very, very few people have that skill and without it, the salary would be in the low twenties." This, he says, is an example of how having the right skills can add a premium to the average salary for a particular discipline. Ros Ewart of Anders Elite agrees, adding that "candidates with specialist skills combined with a good level of commercial awareness can also command higher salaries."
When considering average salaries by business activity, environmental lawyers are still by far the highest earners, with annual pay averaging 45,883, compared with an average of 33,699 for environmental consultants. Civil servants typically fared less well, with central government employees taking home on average 10% less than environmental consultants, and those working for regulatory bodies and local authorities taking home around 20% less.
Nick Yates of BBT says that whilst council salaries are generally lower than commercial company salaries, they attract a particular type of worker - because in general the role comes with more holidays and increased job security, and often a more relaxed work environment and flexitime. "All the time we see candidates going for council work early on [in their careers], then when they have experience [they] move over to consultancy... only a few go the other way, except temporary workers who get paid the same hourly rate regardless," he says.
The other major factor influencing salary rates is geographical location. Greater London and the south-east command the highest annual salaries, although the premium now seems much less than it was a few years ago. According to our survey, salaries in the Midlands and south-west are typically only 1-2,000 lower than those in the south-east on average. Indeed, the typical salary range is also much closer than in previous surveys in the lowest earning regions, with Wales and Northern Ireland now producing average annual average salaries in the sector of 28,500+ compared with London salaries of 35,600.
"Salaries still appear to be at a premium in the south-east of England," confirms Ros Ewart, "but not relative to the higher cost of living". Nick Yates of BBT agrees that "salaries are still higher in the south-east, but the gap is much closer than anytime in the last five years - northern companies are paying higher salaries now to attract the calibre of [environmental] engineer they require."
However, the earning potential for UK environmental professionals appears to be greatest for those willing to work abroad. Survey respondents who worked in mainland Europe earned around a third more on average than those working in Greater London - although this may be more a reflection of their relative seniority than anything else. Lester Lockyer also notes that "many organisations pay financial inducements to British ex-pats who work abroad which may give UK respondents a skewed view of the norm."
According to our survey, pay increases of less than 5% were the norm for the majority (six out of ten), while a lucky few (two out of ten) received salary hikes in excess of that - although these figures are likely to be elevated by inclusion of all those who have changed jobs during the last twelve months. But while salaries are still generally increasing, the average rates of growth are slightly lower than those observed in our previous surveys. This trend was confirmed by specialist recruitment consultants, who suggested that average wages in the environmental sector are currently increasing just ahead of the rate of inflation (see Figure 5).
Professional disciplines where higher than average pay increases were observed included EIA and planning, acoustics, contaminated land/remediation, hydrology/hydrogeology and air pollution control. Interestingly, acoustics also boasted the greatest number of respondents who indicated a decrease in salary, suggesting varying experiences between different organisations.
In terms of salary trends by rank within the organisation, the largest pay increases were typically awarded to directors and associates, although directors also emerged as the most susceptible to pay cuts, particularly at the junior end of the scale. These cuts are undoubtedly linked to company performance, with some 23% of survey respondents indicating that their employers operate some kind of performance-related pay scheme.
Bonus and benefits
Directors also received the biggest bonus payments on average, with 20% receiving a bonus worth more than 20% of their basic salary. The trend for bonus payments for the survey sample as a whole is illustrated in Figure 6. The proportion of employees who did not receive a bonus has increased from 56% in our previous survey to 64% this year - although this may be in part a reflection in the change in composition of the sample to include a greater number of public sector workers.
More than 80% of the respondents who described their main professional activity as environmental protection/regulation did not receive a bonus, with a similar proportion evident among those specialising in hydrology/hydrogeology, ecology and nature conservation. Of those that did receive a bonus, specialists in corporate policy, health safety and environmental management and resource management fared the best of all the professional activities, with around one in five receiving a bonus worth 6% or more of their salary. Those who came off worst included hydrologists, ecologists and those working in nature conservation and environmental protection/regulation, with over 80% of each of these groups receiving no annual bonus.
As Figure 7 shows, pension schemes of various kinds form the most common benefit for professionals working within the environment industry - over three-quarters of the survey respondents are signed up to a contributory scheme and a further 11% benefit from a non-contributory scheme.
But what is even more noteworthy where employee benefits are concerned is the growing numbers of workers that are able to take advantage of various flexible working schemes. Just over half now have the option of flexitime, compared with 37% in our previous survey, while as many as 40% are now able to work from home for some or all of the time, up from 31%. Allen & York's Lester Lockyer commented: "Increasingly, firms are allowing employees to work three- or four-day weeks, or part office/part home based flexitime. It seems to be a growing trend and a positive one which can only benefit those people who have responsibilities outside of the workplace."
Mobile phones, computer laptops and company cars/car allowances also feature highly on the list of benefits for environmental professionals, which may not come as a surprise given that they are often required to work out of the office on-site.
When it comes to annual holiday entitlement, 25 days is the norm for the majority (29% of respondents), while a further 22% receive 26-29 days per year. However, a significant number of respondents receive 30 days (16%) and a small handful receive even more. But when asked to identify the most attractive benefit not currently received, health insurance emerged as number-one on the wish-list, cited by 14% of the sample. This was closely followed by a company car (11%).
Career progression
The survey results suggest that career satisfaction among environmental professionals continues to be typically high, with 37% of respondents describing themselves as content in their current post, with a further 27% indicating that they enjoy their work. Only 12% expressed some negativity towards the job itself.
However, respondents were generally more scathing when it came to rating both their working conditions and future promotional prospects within their current organisation compared with other similar employers, with 60% unhappy with these specific aspects of their current workplace (see Figure 8). Some 57% also felt negative about employment security.
When asked about their immediate career aspirations, the priority for most individuals (38%) is to gain more experience in their current specialist area, while around a quarter of respondents aim to move up the corporate management hierarchy. Around 15% want to move to another organisation as soon as possible, while a similar proportion are happy to remain in their current role for the foreseeable future. Only around 5% of respondents wish to train in a new environmental discipline.
The main obstacles identified by respondents as potentially hindering them in achieving their career goals are shown in Figure 9. While more than a quarter believe there are no hurdles barring career development, the most commonly cited concern was the unavailability of desired jobs, highlighted by almost a third of respondents. Lack of management support and lack of experience scored similarly, but only 5% saw lack of training as an obstacle, suggesting that on-the-job training within the environmental sector is reasonably forthcoming.
With the rapid expansion of the environmental industry and spiralling demand for various specialist skills within the profession, the green industry workforce has been for several years characterised by a high level of employee mobility - and there are no signs yet that this is changing. Employers should perhaps take heed that as many as 53% of the environmental professionals responding to our survey are planning to move jobs within the next two years - more than half of these within six months to a year. A further 14% anticipated a move within three to five years. Less than a third indicated that they did not expect to change jobs in the foreseeable future.
Evergreen's Adam Whitney has noticed a spate of more frequent job-hopping in certain environmental disciplines, particularly those where there are significant skills shortages. Paul Seeley of Eden highlighted the asbestos management sector as a prime example. "In recognising that the demand is high, a lot of junior to middle management are getting job offers to try to up their salary. But there is also a disparity between what employers will pay and unrealistic expectations from those with a limited amount of experience," he says.
Figure 10 shows the main reasons why survey respondents would consider moving jobs. Although pursuit of a better salary and benefits package is top of the list, it is perhaps surprising that it was cited by only 27% of the sample - while management style, range of interesting work, location or change of career path were considered by many to be more important factors.
Most respondents are willing to relocate for the right job, with as many as 64% claiming they would be willing to move within the UK and 51% indicating they would also move outside the UK. But recruitment consultants suggest these figures may be an exaggeration of the true picture - experience has taught them that whilst individuals often say they will relocate, when it comes to the point of accepting an offer, many often have second thoughts. Adam Whitney believes that in reality only 15 or 20% would actually move, "and then it is often to a specific location."
For job moves between countries, Ros Ewart of Anders Elite has noted a big exchange of skills between the UK and the Australia/New Zealand within the environmental sector, despite a general perception that the skills obtained in other countries are not transferable to the UK market. "This is something that we are working on with our clients but the process of change is extremely slow," she says. Adam Whitney says that Evergreen has received more candidate applications from Europe recently, especially from Spanish and Italian nationals, but few are finding appointments at present because "there is a perception that UK experience is needed."
Some 88% of survey respondents to our survey indicate they regularly look at classified job advertisements, the majority of these even when they are not actively job-hunting. The three top publications reviewed for specialist postings were The ENDS Report (68%), The Guardian (41%) and New Scientist (31%). It also emerged that the websites for these and other organisations are also searched frequently. Most recruitment agencies now link with websites to post live vacancy details.
Outlook
Recruitment consultants are generally looking forward to the year ahead as one of sustained growth in the environmental jobs market, reflecting the continuing buoyancy of the industry. "More legislation swells the demand for jobs and it is an increasingly environmentally conscious culture," says Nick Yates of BBT.
"Environment is increasingly a point of discussion and a growing market," says Lester Lockyer of Allen & York. "We expect continuation of the trends of the last few years and are as busy now as we have been all year. This bodes well for 2005."
Meanwhile, Ros Ewart of Anders Elite identifies several core areas of growth, including waste management and regeneration (encompassing brownfield site investigation and remediation), ecology and EIA. She also believes contaminated land will continue to be "an area of extensive possibilities".
But the current skills shortages can only be compounded by further market growth, leaving the industry with a major challenge in managing its human resources.
ENDS would like to say a big thank you to all those who took part in our recent salary and benefits survey.
A set of charts and data from the survey is available in a powerpoint file.