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SME issues revised workforce trends technical briefing

By David Kanagy posted 04-03-2014 11:41 AM

  

SME has published a new technical briefing paper on Workforce Trends in the US Mining Industry that includes updates to the 2012 report SME issued, along with NMA, IMA-NA and NSSGA. The good news: mining added 7,000 jobs in January, compared with an average monthly gain of 2,000 jobs in 2013. Employment of mining and geological engineers is projected to grow 12% from 2012 to 2022.

Having said that, workforce availability is still a significant problem for the domestic mining industry. It is unlikely that there will be sufficient skilled mine labor to satisfy the global demand for minerals over the next 20 years.

While there has been a downturn in the mining business with accompanying layoffs, the need for skilled and degreed employees remains. There is also an increased use of automation in the industry as a possible means to replace existing labor. The actual impact of this is difficult to assess at this point but it could be a possible solution for mining companies.  Mass layoffs in the boom and bust cycle since 2011 may accelerate the already unusually high retirement rate, meaning that the need for replacement workers made by SME in 2011 are likely very conservative.

The Bureau of Labor Statistics and the Energy information Administration are projecting an increase in mining labor needs at least through 2019. While the increase in labor requirements is significant, it pales in comparison to the need to replace the older workers that are now beginning to leave the workforce due to retirements of the baby boomers. Overall, we still expect to lose at least 128,000 workers in the mining industry by 2019 and 221,000 by 2029. Only 44% of the workforce in place today will be present in 20 years.  The question for the mining industry is, if you can’t replace the retiring workers to the levels needed, will the productivity of the industry be able to adapt to doing more with less.  This may be the new norm for all mining industry sectors.

On a brighter note, students that do enter the mining industry are paid very well.  A recent Bloomberg article states that compensation and where you went to school no longer correlate. It showed that a South Dakota School of Mines and Technology graduate earned more than a Harvard Business School graduate!

Currently, mining is one of the few labor sectors where jobs are being added. As the aging workforce retires and the mining sector grows in the U.S. many new job opportunities will be created. However, since there is not a ready and skilled workforce in place, these positions may not be filled with the most qualified people. This has implications for production, labor sourcing, and health and safety, as well as retaining the U.S. knowledge base about mining.





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