Labour in the Resources Industry - Change & Opportunity: A Symbiotic Relationship

Labour in the Australian resources sector is entering a period of change. Currently, the Australian mining industry directly provides 270,500 jobs, with this figure expected to grow by nearly 17,000 over the next four years. There is also set to be numerous structural changes to alter the way labour is utilised within the industry. These structural changes come as a result of adopting efficient practices, government regulation as well as the growing concerns to the health of the workforce.

In State of Play’s 2021 Global Resources survey, over 75% of respondents believed that there will be a health-related industry class action within the next 15 years. Respondents from resource, service and investment companies around the globe highlighted black lung, cancer from diesel exhaust fumes, physiological injuries from repetition of tasks, workplace injuries and silicosis as all adversely affecting physical health. On top of the physical impacts, the mental health of Fly-in Fly-out (FIFO) and remote workers are being adversely affected due to the nature of their lifestyle.

Add the skills transformation required to deal with the technology changes driven by electrification, automation, data, and analytics, and it is clear the industry workforce will undergo significant change.

Whilst large scale changes to an industry workforce can be both costly and risky, if businesses address issues proactively, opportunities exist for them to both boost productivity and mitigate risks such as those related to health outcomes. On the contrary, if resource companies choose not to innovate and evolve their human capital, they risk being stuck with a relatively outdated and unproductive workforce while being overly exposed to threats posed by social trends.

Diesel Fumes, Particulates & Electrification:

In 2012, the World Health Organisation (WHO) classified diesel engine exhausts into a Group 1 Carcinogenic to Humans, the same category as asbestos and mustard gas. These fumes are particularly harmful in underground mines where ventilation becomes an issue, creating significant health risks. A study published in the Occupational and Environmental Medicine journal stated that workers in underground mines can be up to 38 times more likely to develop lung cancer. The diesel fumes also come at a financial expense, with costs associated with ventilation energy as high as 70% of the total operating costs. By converting diesel vehicles to electrichowever, it is estimated up to 40% of ventilation costs can be reduced. With 89% of mining executives believing mines will become fullyelectric within 20 years (SOP Global Resources 2020), there is a real opportunity for companies to become an industry driver and place themselves ahead of the curve.  

 Mental Health & Productivity:  

As more data is released surrounding the impacts of mental health on the workforce, there is a realisation of the benefits of a mentally healthy workforce. For every $1 invested in implementing a successful mental health action plan, there is an average benefit of $5.70 that can be realised by a mining company, significantly higher than the average across other industries of $2.30. Programs coming out of companies include worksite physical activity programs, well-being checks, coaching & mentoring and resilience training.  Whilst there are numerous options to invest in, the end results are clear- less leave, less unproductive hours and less labour turnover which ultimately lead to higher output.

Automation & Changing Skills:

Another trend emerging is the steady implementation of automated production practices, and the changing skill set required of the workforce as a result. Studies have shown a 15-30% boost in productivity from using autonomous mobile equipment, creating opportunities for increased efficiency. Whilst automation may decrease the number of jobs within the mining sector, the jobs that will emerge will require a highly skilled workforce.

Accenture suggests that these higher skilled jobs will be sourced through three methods. The first places the onus on universities and TAFE’s to ensure young talent entering the workforce is equipped with the skills the resources industry requires. Securing mining engineers as well as other young talent is going to be crucial in facilitating automation and the implementation of new artificial intelligence and analytics technology. This is proving challenging with the number of graduate mining engineers, which has fallen from 333 in 2015 to just 47 in 2020. On top of this, there is going to be more integration between different skill sets and backgrounds entering the mining industry, with data scientists, actuaries and software engineers all regarded as vital to help mining companies adapt to the influx of innovation. Therefore, it is up to mining companies to incentivise the top university talent to enter the mining industry as opposed to the more common tech start-up or fintech positions.

In the same Accenture Report, they identified that in order to successfully harness and utilise the new technology, mature workers will need to be reskilled and upskilled. There is an opportunity for the government to work with resources companies to provide support in cultivating the skills required for the mine of the future.

Thirdly, the knowledge and experience of near retirees should be leveraged to create practical digitalised systems. By utilising industry expertise, it will ensure the new systems will help rather than hinder organisations.

All of these avenues require a strong relationship between industry, tertiary education institutions and the government to ensure the workforce is adequately equipped to meet the changing environment. On the 2^nd of September, the Federal government hosted the annual Jobs and Skills Summit. Several reforms and recommendations produced will aid in upskilling, reskilling and expanding the wider workforce, there is pressure placed on the government to do more to compliment the efforts of the resources sector. Without the government working congruently with the other two parties, it will be incredibly challenging to equip the current workforce with the skills required for the future of mining.

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