Geologists’ Salaries Jump Again

Retirements Creating a ‘Changing of the Guard’

Salaries for petroleum geologists took another jump in 2006-07 with a weighted average increase of 9.1 percent overall in pay, according to the annual AAPG Salary Survey.

The 2005-06 year’s salary survey showed an overall 16 percent salary increases.

The survey, conducted annually since 1981 by Mike Ayling of MLA Resources in Tulsa, showed the 15-19-year experience category charting the largest increase, with an 18 percent raise in salaries.

Entry-level geologists showed a 9.5 percent increase, with the 3-5 year category geologists’ pay rising 13 percent. The 20-24 and 25-year-plus experience categories also recorded double-digit increases, with 10.3 and 10.5 percent hikes respectively.

The 10-14-year experience category charted a loss of 2.5 percent in recorded salaries -- but Ayling noted the anomaly of this group was due to a lack of adequate data points, as it always has been for this group as it matriculates through the career cycle.

It is this same age category that recorded little entry-level hiring during a downturn in the industry in the early-mid 1990s.

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Salaries for petroleum geologists took another jump in 2006-07 with a weighted average increase of 9.1 percent overall in pay, according to the annual AAPG Salary Survey.

The 2005-06 year’s salary survey showed an overall 16 percent salary increases.

The survey, conducted annually since 1981 by Mike Ayling of MLA Resources in Tulsa, showed the 15-19-year experience category charting the largest increase, with an 18 percent raise in salaries.

Entry-level geologists showed a 9.5 percent increase, with the 3-5 year category geologists’ pay rising 13 percent. The 20-24 and 25-year-plus experience categories also recorded double-digit increases, with 10.3 and 10.5 percent hikes respectively.

The 10-14-year experience category charted a loss of 2.5 percent in recorded salaries -- but Ayling noted the anomaly of this group was due to a lack of adequate data points, as it always has been for this group as it matriculates through the career cycle.

It is this same age category that recorded little entry-level hiring during a downturn in the industry in the early-mid 1990s.

Ayling found that 2006 “showed fits and starts in hiring activity, somewhat driven by the rapid build and then decline in oil prices, which in some cases led to caution on the part of employers.”

The weighted weekly average oil price in 2006 began at $53.28, peaked at $69.52 in August and ended the year at $50.42.

Changing of the Guard?

The survey is based on employed, salaried geoscientists and is based on salaries alone. It does not include bonuses, employee benefits, autos or other perquisites.

It does not attempt to include anyone whose compensation is in the form of consulting fees, retainers or overrides.

The purpose of the survey is to provide a yardstick for those interested in assessing their compensation, and Ayling strongly feels that compensation is often a secondary consideration when evaluating overall job satisfaction.

The survey also is based on U.S. salaries, considered the “gold standard” for the industry. The measurement for international salaries for explorationists is virtually on a country-by-country, case-by-case basis, Ayling said, which makes statistical averaging non-productive beyond the boundaries of the specific country.

Ayling added that many ex-pats are paid U.S.-based salaries, while the national oil companies opt to pay compatriots on a different, lower scale.

Ayling also sees a “changing of the guard” occurring.

“The geoscientists that were the youngsters in the mid ‘70s growth spurt are now reaching retirement (not early retirement) age,” he said. “I was chatting with one recently (who has an incredible record as an oil finder) and he tells me that at 64, he’s ready to do something else. He is fortunate to have made a good deal over the years, and can now take the time to pursue other interests.

“This does not bode well for our industry.”

Meanwhile, Ayling said many geologists in the 20-year category have benefited from the lack of experienced geoscientists.

“Individuals with whom I spoke two years ago have seen their salaries jump from the mid-$120’s to over $165,000 -- for staff level positions. At some point, however, merely paying higher dollars isn’t going to attract talent in sufficient numbers.”

Thus, he noted, job satisfaction becomes a priority for an already-employed explorationist.

While the 2006 numbers again came in strong, Ayling said that he is “concerned about what 2007 has to offer.

“There are rumors of layoffs to be associated with several large industry mergers,” he said. “On the other hand, with a rig count that has doubled since 2003 and grown by close to 20 percent over the past year, activity has continued to stay strong.”

The apparent contradiction of layoffs in the face of increased activity is created by mergers and acquisitions and rumors of such that also cloud the hiring climate in the minds of some managements.

“Individuals with whom I speak,” Ayling observed, “tell me more often that they are looking for a company with a clear purpose in mind, where they feel their contribution is truly valued.”


2006 Geological Salary Survey

YEARS EXPERIENCE
HIGH
AVERAGE
LOW
0-2
$ 90,000 
$ 82,200 
$ 75,000 
3-5
  96,000
  89,600
  83,000
6-9
145,000
  98,500
  72,000
10-14
175,000
111,500
  90,000
15-19
180,000
141,000
  95,000
20-24
260,000
155,000
106,500
25+
208,000
149,900
109,000

Average Salary by Degree

YEARS EXPERIENCE
B.S.
M.S.
PH.D.
0-2
$ 76,500 
$ 83,300 
$ 90,000 
3-5
  83,000
  88,400
  93,400
6-9
  90,000
  99,700
  98,500
10-14
105,000
113,400
111,500
15-19
115,000
156,800
141,000
20-24
141,000
148,600
155,000
25+
145,300
148,200
168,000

Historical Averages

YEARS EXPERIENCE
AVERAGE SALARY
1999
2000
2001
2002
2003
2004
2005
2006
0-2
$ 53,600 
$ 59,700 
$ 64,000 
$ 65,000 
$ 65,600 
$ 67,800 
$ 74,400 
$ 82,200 
3-5
  61,400
  66,000
  67,500
  71,200
  67,700
  75,600
  81,300
  89,600
6-9
   78,400
  74,200
  74,500
  78,300
  75,700
  77,500
  95,400
  98,500
10-14
  83,400
  89,400
  95,000
  96,600
  91,900
107,500
114,400
111,500
15-19
  94,900
100,600
  99,400
102,500
102,500
116,000
119,600
141,000
20-24
107,700
111,700
111,600
113,900
118,100
112,800
139,000
155,000
25+
104,400
117,300
124,000
126,900
125,100
128,300
134,100
149,900

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