Statoil makes workforce reductions

Statoil’s effort to standardise, simplify and increase efficiency enters the next phase. The potential workforce reduction is estimated at 1100-1500 permanent employees by the end of 2016. Alongside this, Statoil will reduce the number of consultants by around 525. The estimate for workforce reductions reflects the STEP efficiency potential and further corporate improvements over the coming 18 months.

Statoil has committed to delivering US$1.7 billion in annual savings from the 2016 improvement programme, and beyond. The improvement programme and strict capital expenditure prioritisation was initiated in 2013, addressing the industry wide cost and competitiveness challenge, well ahead of the current downturn.

Statoil’s competitiveness as a factor

Since late 2013, Statoil’s workforce has been reduced by 1340 permanent employees and 995 external consultants. The reductions are achieved through a more limited use of consultants, attrition, internal deployment into new positions, severance packages and early retirement. Recruitment has been very limited, but the company has upheld its focus on recruiting apprentices and graduates.

Anders Opedal, Executive Vice President and Chief Operating Officer at Statoil commented: "We regret the need for further reductions, but the improvements are necessary to strengthen Statoil’s competitiveness and secure our future value creation."

"Decisions on workforce reductions as a consequence of increased efficiency will be made in each Business Area, based on assessments involving leaders and employee representatives, and local consultation. When this is completed, we will know the accuracy of the current estimated range. This work will take place in the Business areas in the period from August to November," says Magne Hovden, Statoil’s Senior Vice President for People and Organisation. "We have, so far, solved the workforce surplus through voluntary measures and maintain the ambition to conduct the people process over the next 18 months, without forced measures."

Looking into the future

The implementation of the improvement agenda continues in the upcoming weeks and months. The changes and actions from STEP have been decided after consultation with the employees’ representatives and these will now be handed over to the Business Areas for implementation.

Simplification of work processes, clear accountability and enabling future growth opportunities guide Statoil’s continued improvement effort. There will be further changes and adjustments to the organisational set-up in order to realise the full potential of the improvement programme and these will be presented by the end of the month.

Adapted from press release by Callum O'Reilly

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