It’s time to face music: The maritime world is entering a new era, one that calls for more than just technological upgrades. It demands a bold shift in how we view and invest in human capital.
The superhero seafarer
Let’s be clear: we are asking our seafarers to be Spiderman, Iron Man, Captain America, and Superman combined. We expect them to master an overwhelming array of skills without a solid, tangible framework for how they are supposed to get from where they are now to where the industry expects them to be.
Seafarers today are expected to understand and operate vessels powered by alternative fuels and sources of energy. On top of that, digitization and automation demand new technical and cognitive skills. The list is virtually endless, and all within a profit-driven industry that often lacks the will to invest in developing those skills.
The reality of industry economics
In any case, the fact remains that the maritime industry is built on profit. Every stakeholder needs to turn a profit to survive. Yet, the cost of decarbonization and human upskilling is real, enormous, and under-addressed.
We’re talking about training potentially millions of seafarers in the coming years. A recent study from BIMCO and DNV studies estimates that about half a million seafarers will need to be upskilled. Multiply that by the cost per person, and we’re looking at a financial burden no one seems ready to bear.
On the other hand, education and training institutions are not prepared. We don’t have model courses or infrastructure in place for many of the new technologies. In addition to all this, regulatory development is slow.
Myths about human performance
There are persistent myths about human performance in the maritime sector that hinder real progress:
Technology eliminates human error
- Myth: Advanced technology and automation completely prevent mistakes.
- Reality: Technology reduces some errors but introduces new challenges, such as complacency, over-reliance, and technical failures requiring human intervention.
Training guarantees optimal performance
- Myth: Completing training programs ensures that seafarers will always perform at their best.
- Reality: While training is essential, real-world performance depends on factors like attitude, motivation, stress, teamwork, and environmental conditions.
Automation reduces workload for seafarers
- Myth: Automated systems decrease workload and stress for crew members.
- Reality: Automation often shifts the nature of work, requiring continuous monitoring, troubleshooting, and decision-making under pressure.
Younger crews adapt better to modern systems
- Myth: Younger seafarers are naturally better with technology and adapt faster.
- Reality: Familiarity with technology doesn’t necessarily translate into operational proficiency or better decision-making.
The shrinking career lifespan of seafarers
Another significant challenge is the fact that the average career span of a seafarer has decreased dramatically: from 25–30 years in the 1990s to less than 15 years today. This trend is accelerating.
Furthermore, crew demographics are shifting from European to Asian and now increasingly African nations, driven in part by cost-cutting. However, retaining the competence levels required for decarbonization under these conditions will be incredibly difficult. And this raises a very real question:
“What is the price of human performance?”
This isn’t just a theoretical concern. It’s a real-life issue with real-life implications. Executives across the sector are faced with increasingly complex questions such as: How do we train people and retain them? How do we justify the cost? What’s the Return on Investment (ROI) in human capital?
While industries have long embraced ROI as a critical measure for equipment, fuel efficiency, and technology upgrades, the maritime sector remains strikingly quiet on ROI when it comes to people.
In our industry, no one really talks about Return on Investment when it comes to training or human performance.
The value of competence and performance
Human performance is a product of competence. That is the reality. You gain competence through training. Once you have competence and motivation, then you perform. And when you perform, you learn. That is how it works.
It is about putting the horse before the cart, and training must come first. This is how things work in real life, and the reason behind why the industry has not yet collapsed despite the shortage of seafarers. The 70-20-10 learning model proves it:
- 10% comes from formal training
- 20% from informal learning through peer discussion
- 70% from on-the-job experience
If we apply this to maritime, it becomes clear: We need SIPs, simulators, and hands-on, real-life training. Seafarers cannot be properly trained through academies alone, or through or e-learning platforms. Real learning happens on the job.
A simple ROI formula
We have done the math, and this model is already being applied consistently across other industries. To calculate human capital ROI, you can use a straightforward formula:
ROI = Net Revenue ÷ HR Costs
Net revenue is calculated by subtracting HR costs from the total daily income, with the daily income depending on the specific situation. HR costs refer to the daily human resource cost, typically expressed in dollars per day for ships.
What is considered a good return?
The next question is, what constitutes a good return for every dollar invested? For LNG tankers, for example, spending one dollar could result in a return of seven dollars. For containers, a similar return is achievable. The evaluation of these returns depends on the specific goals and risk tolerance of the investor. The numbers provided suggest that returns of seven-to-one or three-to-one are not only plausible but also sensible.
In the case scenario below, the income is calculated after subtracting fuel costs, which vary depending on whether the fuel is paid for directly or under a time charter. In the case of a time charter, only the charter income is considered. Financial costs can be excluded from the calculation, but the formula remains applicable.
The key takeaway is that these calculations are valid. The concept of human capital ROI is sound, even though it is not widely discussed, particularly in the shipping industry.
The numbers make sense, and it is recommended that people in the shipping industry begin to invest more in their workforce. While people are often viewed as a cost center, they should be recognized as an asset. This notion is frequently mentioned in press releases, but it should be treated as a reality. People are a valuable resource, and it is time to start investing in their development.
Operating in a time of uncertainty
Over the past five years, we have faced three major global disruptions, or in the words of economist Nassim Nicholas Taleb “black swans”: the COVID-19 pandemic, the Russia-Ukraine crisis, and now the uncertainty surrounding US President Donald Trump’s influence on global trade.
There is a lot of uncertainty. But one thing is clear: traditional thinking is holding this industry back. We need to learn by doing, through lived experience.
And we need a real, honest discussion with stakeholders across the industry about who pays for upskilling. Everyone is willing to talk about the issue, but very few are willing to take action. That is the key challenge.
The cost of decarbonization
We also need to acknowledge the cost of decarbonization. It is not the shipowner, the seafarer, or the charterer who will ultimately pay. It is the end consumer. The person buying the sneakers, the person buying the dress. They will bear the cost.
We have seen similar backtracking in the European Union regarding electric vehicles. Five years ago, the EU said that by 2035, only electric vehicles would be allowed. Now, automakers are pushing back, asking for delays and regulatory flexibility because they are struggling. Plants are shutting down, and operations are moving to other continents.
Human sustainability and the future of the workforce
One major challenge moving forward is the attraction and retention of high-caliber seafarers. It is getting harder and more expensive.
Recently, the Global Maritime Forum introduced the term “human sustainability,” but almost no one in the industry is talking about it. And frankly, I am not sure we can sustain the same quality and caliber of people.
Eventually, this will add a significant cost layer. If we accept that each ship will require an additional $10–40 million in CAPEX or OPEX in expenses over its lifecycle, then we also have to accept that the cost of people, the human capital required to run these ships, will increase.
Above article has been edited from Apo Belokas’ presentation during the 2025 SAFETY4SEA Manila Forum.
