A new study was recently released which showed that Alberta had the highest unproductivity rates compared to other North American jurisdictions. Although the province’s growth is high, it has been driven by increases in labour, rather than improvements in productivity of individual workers. The study (see below for the article) goes into other aspects of productivity, but the industrial numbers are of concern here.
‘Job machine’ Alberta dead last in labour productivity among oil regions: report
The numbers are not a surprise to people involved in Alberta’s (mostly) extractive industries. Alberta suffers from more inclement weather, and crucially weather swings, that most of the jurisdictions surveyed. Productivity at most Oilsands facilities averages 3 hours for every 10 hours paid, in the estimation of this blogger (based on direct knowledge of the system). In addition, the increase in labour demand has led to the hiring of inexperienced workers, who typically take a few months to come up to speed but are charged with producing at full capacity right away. Finally, most industrial sites in Alberta are in fairly remote locations. The supply chain issues around construction materials in particular, result in further unproductivity per dollar spent.
When the word ‘efficiency’ is discussed in the energy industry in general, the focus is often on operational efficiency. How can turbines optimize steam usage? How can motors be more efficient? How can waste heat be captured and recycled through the process? These are all important questions, but for companies to become truly efficient, productivity has to be improved not only in operations and in technology, but also in construction/maintenance execution. Execution efficiency will result in energy savings, as there would be fewer start-ups and shutdowns (both of which are notoriously energy-intensive processes). In addition, the time technical and operations personnel save from ‘fire-fighting’ could be devoted to more long-term aspects of operational excellence, most of which also have direct parallels to improved efficiency.