The renewable energy sector in the UK is experiencing remarkable growth, driven by government policies, increasing global energy demands, and technological advancements. This growth is transforming the energy landscape and creating substantial employment opportunities across various roles and regions.
Employment Highlights
The renewable energy sector's workforce is heavily comprised of technical and engineering roles. Technical and skilled trades represent 13% of the staff in the UK energy and natural resources (ENR) sector, making them the largest functional categories. Engineering roles account for the highest share of base compensation costs at 15%, surpassing technical fields and project/program management. Geographically, the workforce is well-dispersed across the UK, with significant concentrations in Scotland, London, the Southeast, Northwest, and West Midlands.
Regional variations in pay competitiveness reflect economic dynamics within the sector. Central London leads in total guaranteed compensation (TGC), paying 10% above the national median. Aberdeen, recovering from past declines, now pays 4% above the national median for base salaries and 7% over typical levels for total rewards. East Anglia exceeds typical pay by 2%, while Northern Ireland lags 10% below the median.
Compensation across subsectors highlights significant disparities. The oil and gas subsector consistently leads in pay medians for base pay, incentives, and total compensation, with pay medians at 132% above the sector-wide rewards. In contrast, utilities and water subsectors lag substantially, with utilities paying 12% below the broader sector median and water sitting 30% lower. Engineers in oil and gas are paid 25% above average, while utilities pay engineers 13% higher than the average for engineering roles in renewables and consulting.
Sector Growth Highlights
The UK government's commitment to achieving net zero by 2050 is a significant driver of growth in the renewables sector. ENR organisations are increasingly focusing on environmental, social, and governance (ESG) initiatives. Global energy demand is projected to rise by 15% by 2050, accelerating growth in electrification and renewable energy sources. Electricity generation is expected to increase by 70% by 2050, with expansions in natural gas, solar, wind, and nuclear power offsetting declines in coal.
Adapting compensation strategies is crucial for attracting and retaining talent in the evolving sector. ENR organisations are balancing current operations with future business shifts and talent demands. Strong growth among renewables and alternative-energy organisations reflects a critical focus on pay trends and strategies. Positive pay trends are observed across job grades in 2023, indicating recovery post-pandemic.
To sustain growth and attract talent, ENR organisations should consider several strategic recommendations. Workforce segmentation prioritises talent groups based on transition exposure, such as renewables technicians or digital specialists. Understanding employee needs is vital, tailoring rewards based on emerging workforce concerns and priorities.
Pay transparency is essential, preparing for regulations mandating pay data disclosures and leveraging analytics to explain equity and prevent perception issues. Developing official guidelines on remote and hybrid work policies meets post-pandemic expectations, while ensuring pay bands across locations align with market practices and support talent access needs.
Identifying and addressing internal pay disparities ahead of rising governance scrutiny is also crucial.
