EDITORIAL PAGE (April 27, 1992)

Vital statistics for the Canadian mining industry in 1991 paint a gloomy picture.

Value of production, not including petroleum and natural gas, was down 15.9% to $10.4 billion. Employment in mining, concentrating, smelting, refining and semi-fabricating was down 12.7%. Capacity utilization was down 2%, operating revenues were down 11% and capital spending was down 21%. The value of metallic minerals, including gold, copper, nickel, zinc and iron ore, was down 16.6% to $10.4 billion.

These are hard figures coming after a similarly difficult year in 1990. They reflect the hard times facing all business today, not just the mining business.

In fact, when compared to other sectors of the economy, mining continued to play an important role in the Canadian economy, actually increasing its share of total economic activity despite the lack of support it seems to have among the general population.

So, while proving to be a strong engine for the economy during tough economic times, mining continues to be taken for granted — even chastised for not being more progressive, more sophisticated, more in tune with the times. Mining is still seen by the public and by many leading economic thinkers as a sunset industry. Social and environmental issues take precedence over resource development on the political agenda while emerging high tech industries and trade regulated sectors such as agriculture dominate economic discussion.

Yet as well as showing how difficult the recession has been on the mining industry, these figures show that mining is proving to be a more reliable bulwark against the battering of economic troubles than other industries. Minerals, not including oil and natural gas, accounted for 4.4% of Canada’s gross domestic product in 1991 but 18.3% of exports during the first nine months of 1991. About one-quarter of Canada’s economy is based on exports, so minerals’ contribution is significant. The mineral industry in total, which includes fuels, accounted for 27.1% of Canadian exports.

This industry may be seen by others as a declining industry, but it certainly isn’t seen that way from inside. When it comes to investing in the future, mining outperforms other sectors of the economy — an illustration of mining’s commitment to long-term operations.

For example, while other industries pay lip service to research and development, the mining industry has more than doubled its R&D spending since 1988 and now accounts for 5.8% of total Canadian industrial R&D — considerably more than its relative contribution to the overall economy would indicate. That figure would triple if exploration expenditures were included, and many consider exploration to be mining’s “new product R&D” in that it finds the products to be produced in the future.

Likewise, capital spending in the mineral industry in 1991 was disproportionately high for the industry, another example of long-term thinking. Mining accounted for 5.6% of total capital spending in the Canadian economy in 1991.

There’s no doubt that our economy is hurting badly, and so is the mining industry. But mining has been one of the most solid performers. When the good times return, it will be worth remembering which sectors of the economy were able to help pick up the slack when others could not pull their weight.