Brazil

By Augusto Carneiro, Brazil country manager, Maxwell Drummond International

Brazil is now the sixth largest economy in the world according to figures published by economic think tank the Centre for Economics and Business Research.The country’s rapid economic growth of 2.7% in 2011 coupled with the current boom in Exploration and Production activity, particularly offshore in deep water, means that companies in Brazil’s Exploration and Production sector often struggle to recruit key workers. For instance, the Brazilian government estimates that 250,000 workers will be needed for the development of new oil fields over the next four years until at least 2016.

In Brazil, from 1953 to 1997, the state-owned oil company Petrobras had the monopoly on upstream development and was only employer available to Brazilians looking to work in the energy sector. Although Petrobras is now a semi-public multi-energy corporation, it is still very much in charge of local recruitment, hiring workers via publically announced written examinations. As a result, many young people unwilling to work for the Government are focusing their education and careers on other sectors, resulting in a severe shortage of technical engineers and leaders. Indeed, with Petrobras predicting investments of US$224 billion from 2011-2015, qualified workers are a hot commodity in Brazil.

Consequently, many companies based in Brazil are looking to recruit outside the region to avoid taking people from competitors which only serves to inflate salaries. The stringent local labor practices, laws governing the importation of workers and an extensive work visa program all contribute to the pressures on recruitment. Thankfully, visa issues in Brazil are now much simpler. Previously, a company wanting to bring an expatriate had to prove that the talent they were looking for was unavailable in Brazil and that personnel with the necessary work experience could only be found in the parent company abroad.

Nowadays, although a company wanting to bring in foreign talent will still face significant red tape with the Brazilian authorities, a work visa will be granted in 60-90 days if all the proper procedures are carried out. In the Exploration and Production sector, virtually every position can be filled by an expatriate. However, in our experience in Brazil, there are two important exceptions to ease cultural differences: the logistics and supplies team must be Brazilian otherwise there is a risk of not understanding how to deal with local suppliers when it comes to clearing equipment through customs and the Petrobras-liaison leader, although they don’t necessarily have to be Brazilian, they must speak the language and know the culture almost as well as a native.

In countries like Portugal and Spain, a sizeable percentage of new hires are said to be Brazil-bound. One local newspaper recently stated that four out of five new hires in Portugal will be working in Brazil. Hiring in Portugal is simpler because the languages are very similar, and there´s a long-standing agreement between Portugal and its former colony to give preferred treatment to people coming to Brazil from Portugal. This rule was never reciprocal, nor was it ever meant to be, despite much local protest during Brazil´s crisis of the 1980s when many locals wanted to immigrate to Portugal and further afield in Europe.

As a retained executive search company specializing in the upstream energy industry, Maxwell Drummond is seeing a rise in activity as Exploration and Production companies operating in the region are looking to supplement their local talent with external expatriates with the technical and leadership experience needed.

Overcoming these challenges is key to the continued growth of Exploration and Production in Brazil. The country must attract young people to the industry to avoid threatening future growth. Local companies must continue to attract foreign workers to the region and put pressure on the Brazilian government to ease up on policies, taxes and regulations that are hindering their ability to bring these workers into the region. Once these challenges are overcome, I am confident Brazil will continue its accelerated route onto the global energy stage.

About the author

Augusto Carneiro is the founder of Zaitech, Maxwell Drummond International's partner in Rio de Janeiro. He has fourteen years experience in the executive search industry, working as a partner at Korn/Ferry for six years before founding Zaitech in 2004. Zaitech specializes in executive search in the oil, gas, energy and mining sectors as well as executive coaching.

Maxwell Drummond International is a world leading retained search consultancy offering professional search services to clients in all sectors of the energy and natural resources industries.