With commodity prices rebounding from their lowest in at least 25 years, miners are stepping up spending and considering the reactivation of projects placed in the back burner, but there is a new looming risk they don’t seem ready to deal with — their ability to access workers with the skills needed in an upswing.
That is the main conclusion of a recent report by Canada's Mining Industry Human Resources Council (MiHR), which warns about the immediate consequences of the lack of recruitment over the past five years.
In that period, Canada’s mining industry endured an economic downturn that continued throughout 2015. Due to this trend, a number of mining operations faced the decision to keep their operations running, but in less than optimal conditions. Others, particularly in the oil sands sector, simply scaled back production or shut down their operations, laying off hundreds of workers.
As a consequence, mining employers face a cumulative hiring requirement of almost 86,000 workers under an industry contraction scenario, the report warns. The figure includes replacing about 49,000 workers over the next decade due to retirement.
“At an average 37 years per person of experience this is a significant experience gap, layered onto the complexity of those occupations that show a gap in supply, where experience cannot be replaced by education,” the report says.
The authors warn that if the mining industry does return to growth, employers could then face a cumulative hiring requirement of up to 127,000 workers.
Occupational shortages will be different depending on the specific sector and the type of jobs to be filled, says the report, which includes a “gap sensitivity index”. The metric indicates the degree to which mining employers are vulnerable to a change in the inflow of new workers in particular occupations, concluding that “technicians,” “engineers” and “managers” continue to be the most sensitive positions, even in an industry contraction scenario.
“During an economic downturn, a thin labour supply is less obvious and tends to be discounted, as workers are less in-demand,” says Ryan Montpellier, executive director, MiHR. “Over the long-term, industry will need to ensure that the talent pipeline is maintained, to avoid more serious labour market challenges when the market recovers– which it will inevitably do,” he notes.
The report warns that now, more than ever, Canada’s mining industry needs to be looking at its future labour market needs and putting in place collaborative strategies to ensure it has a robust, appropriately skilled supply of workers — both now and in the coming decade.