There was some shocking news out of Ottawa this week, so brace yourself: after two-and-half-years of study, the federal government has determined that Canada’s mining industry is made up mostly of rich, old, white guys.
OK, this is hardly news to anyone who’s attended a mining convention in recent years or flipped through a mining company’s latest annual report. However, the study by the federally funded Mining Industry Training and Adjustment Council (MITAC), entitled Prospecting the Future — meeting human resources challenges in the Canadian minerals and metals industry does put some valuable, hard numbers on the challenges facing the human resources departments of Canada’s mining industry.
The in-depth study is the first of its kind since 1993. It involved surveys of 48 mining firms representing 276 minerals and metals sites across Canada, and 19 universities and colleges offering mining-related programs. As well, there were more than 700 surveys of, and interviews with, employees and groups representing industry associations, unions, businesses, schools and aboriginal groups.
Mining is booming here in North America and around the world. Since 2002, Canadian mining’s gross-domestic-product growth rate has been about twice that of the Canadian economy, and weekly earnings in the industry in 2003 averaged $1,085.82 — second only to the red-hot oil and gas sector. Coal and metal-ore miners were the highest earners.
On the back of continued high commodity prices, most forecasters are predicting more strong growth for the global mining industry for many years to come.
But, in its key findings, the study warns of a looming shortage of qualified personnel to fill vacancies in Canada’s mining industry during the next decade.
Right now, more than half of Canadian mining’s 79,000-strong workforce is aged 40 to 54 — an age group that represents only 39% of the total Canadian workforce.
Mining employers predict that 25% of their current workforce will retire within 10 years, whereas 40% of employees surveyed said they planned to retire in that time-frame. (Over the next 5 years, the numbers drop to 15% and 17%, respectively.)
The largest group planning to retire is, understandably enough, in the skilled trades — it’s physically demanding work that’s still high-paying enough to create an adequate retirement fund.
The Canadian mining sector’s labour force expanded by 3.6% between 2003 and 2004, compared with an average annual growth rate of 2% over the previous decade. But for the sector to grow without substantial productivity gains, Canadian mining must not only replace its retiring workers, it must step up its recruitment of younger workers.
The crunch comes when you look at the miniscule number of students enrolled in mining-related programs in Canada’s universities and colleges. In 2002, for instance, only 204 students graduated with mining-specific undergraduate engineering degrees.
Things are on the upswing somewhat at the nation’s post-secondary schools, with enrolment for mining-related programs expected to rise annually over the next decade by 3.3% for universities and 7.5% for colleges and technical institutes. The study predicts 13,800 students will enrol in mining-related university programs during the next decade.
The yawning gap appears when the study looks at the supply and demand estimates for personnel over the next decade. At a presumed “low-growth” estimate, the Canadian mining industry will require a 90,300-person workforce in 2014, but the “demand” (retiring workers) of 57,200 people will vastly outstrip the “supply” (young workers entering the industry) of 9,800 people — leaving a whopping supply-demand gap exceeding 47,000.
As the study says, this gap will pose a “major challenge for the minerals and mining sector.”
For the individual, comments MITAC’s Executive Director Paul Hebert, “this looming skills shortage [means] the career potential is great for the right people with the right skill set, particularly skilled-trade workers, engineers and geoscientists.”
The study also pinned down some more demographic numbers:
– Women make up about 13% of the workforce in Canada’s mining industry, up from 9% in 1993 and compared with 47% in Canada’s overall workforce. In particular, women hold 63% of Canadian mining’s finance and administration positions.
– Aboriginals, who make up 2.6% of Canada’s workforce, comprise almost 5% of the workforce in Canadian mining, peaking at 39% at the Ekati mine the Northwest Territories.
– Less than 3% of the Canadian mining industry are “visible minorities” — a bureaucratic term that excludes aboriginals — compared with 13% of Canada’s total workforce.
– Recent immigrants working in Canada’s mining industry accounted for only 0.5% of the workforce, versus 2% in Canada’s total workforce.
Pierre Lassonde, president and CEO of Newmont Mining, spoke of his own company’s experience with the looming skills shortage at a money-raising function this spring at the University of Toronto’s Lassonde Institute for Engineering Geoscience.
He said half of Newmont’s qualified personnel will be retiring in the next ten years, and asked, “Where the heck is the next generation going to come from? It’s a serious challenge, and we see it at Newmont. This year our company has hired ten per cent of all the graduates in North America in mining, and even that is not enough.”
Lassonde noted that today, “we’re producing twice as much metal with half the people as we did twenty years ago; our productivity’s gone up four times.”
He attributed these productivity gains to improved technology developed by institutes such as the one at U. of T., which he wants to see entrenched as one of the top five mining schools in the world.
“Very few education programs will survive over the next twenty years as the industry continues to increase its productivity and shrink,” Lassonde predicted. He added that the surviving schools need to attract higher quality students, and produce the “very best professionals.”
More information on MITAC and its study are available at www.mitac.ca and www.prospectingthefuture.ca.
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