Photographer: Vladimir Weiss/Bloomberg

Energy Powerhouse Takes Recruitment Drive to YouTube

  • CEZ, Unipetrol, need to boost hires to plug looming skills gap
  • Number of students at technology, science schools slump

A one-minute video posted on YouTube shows an accelerated first-person view of climbing high-voltage towers, flying a helicopter and wading through waist-deep snow, all with loud music pumping in the background.

The clip is not urban parkour or the opening scene from a new James Bond movie, but the latest attempt by Central Europe’s biggest utility to plug a looming skills gap. Shot mostly by real CEZ AS employees wearing body cameras, the video makes a pitch to students and young workers that technical work can be fun, exciting and well-paid.

The plight at energy companies from CEZ to Poland’s PGE SA and Hungary’s MOL Nyrt. are part of a larger strain on the labor market across eastern Europe. They are competing for workers with everyone from manufacturers to software companies in the expanding post-Communist economies, from where millions of workers still venture west for higher wages.

The projected shortage may soon have a material impact on business too as companies struggle to replace aging workers. The prospect of escalating wages to entice younger workers could soon start to impact CEZ’s net income, according to Komercni Banka AS, the Czech unit of Societe Generale.

“We’re missing electricians, machinery operators, engineers,” Pavel Puff, CEZ’s head of strategic recruitment, said in an interview in Prague. “It’s a huge problem. The young people don’t see energy as a sector with a future.”

To combat that image, the companies are funding programs at technical schools and university campuses where they try to recruit promising students before graduation. They’re also offering training and a good pay package with attractive benefits.

“It’s paramount that we focus on investments in education,” Czech Prime Minister Bohuslav Sobotka told a labor market conference in Prague on Friday.

Unipetrol will need to replace as many as 500 workers out of its 4,500 workforce in the next decade. CEZ’s distribution unit will struggle to replace some 200 positions by 2020.

Czech manufacturers could immediately fill some 130,000 jobs, with or without technical qualification, according to the country’s Industry Association. About a third of the association’s members had to start declining orders because they don’t have the manpower.

The average age of employees in the business is 46 and it keeps going up, Puff said. Unless the utility finds a solution, there will be a real impact on profit, he said without elaborating.

A deal between CEZ and unions resulted in a general wage hike of 3 percent this year. That may increase even more next year, according to Komercni Banka. Every 1 percent extra means an additional 200 million koruna ($8 million) in operating costs, said Richard Miratsky, an analyst at the bank.

Science, Machinery

Making matters worse is the shrinking number of students pursuing degrees in relevant fields. Czech secondary schools focused on science and technology have 53 percent fewer students than 8 years ago, according to the government. Enrollment at vocational schools for machinery operators dropped by 37 percent in the same period.

“It’s difficult to find not only qualified and experienced specialists, but also simple operators,” said Mikulas Duda, a Unipetrol spokesman in Prague. The refiner, controlled by Poland’s PKN Orlen SA, also helps fund courses at the Czech Republic’s largest chemistry university.

One facility facing a shortage is CEZ’s Temelin, a nuclear station in the south. The 16-year-old plant is competing for technical graduates with German machinery maker Robert Bosch GmbH, which has its Czech factory only 18 miles away in Ceske Budejovice.

“We go after the same people,” Puff said. “Plus the plant is near Austria and Germany, so a lot of promising people end up going there instead.”

German Pay-Package

German salaries are on average almost 3.7 times above those in the Czech Republic.

CEZ pays a fresh high-school graduate without any experience a monthly wage in line with the national average of 27,300 koruna ($1,065), according to Roman Gazdik, a spokesman. If they have some experience, or after gaining it, they can get “several thousand” koruna more, he said.

As the Czech population ages and fewer people are entering the workforce amid a drop in the birthrate in the 1990s, the unemployment rate fell to a 20-year low of 3.8 percent in August. Poland’s Central Bank Governor Adam Glapinski has also warned that his country’s 5.7 percent rate is below its “natural level.

To help plug the hole in the shrinking labor market, the Czech government approved last November a fast-track visa procedure for qualified workers from Ukraine. Still, prospective employers from manufacturers to hospitals have been complaining that the process is still long and cumbersome.

Before it's here, it's on the Bloomberg Terminal.