How the skills shortage came to be

With the availability of skilled workers decreasing in the mining industry, James Holden, Spencer Ogden, UK, looks back at the last two decades and asks how the skills shortage came to be.

In the course of the last century, the mining industry has gone through some extreme peaks and troughs. Currently, after some difficult years, industry professionals are relieved to be heading into what many analysts see as a period of renewed market confidence. Yet the future of the industry remains at risk, not just from fluctuating commodity prices, but from the threat of a widening skills gap.The mining skills gap: a serious challenge

Action needs to be taken by mining companies and by the industry as a whole if a serious and enduring skills crisis is to be avoided. While this may seem sensationalist, unfortunately, it is not. The potential for a shortage of skilled workers is now the second largest risk for mining businesses, after resource nationalism. To understand why, it is necessary to first look at the industry in the context of the 1990s, 2000s and early 2010s.

1990s

At the latter end of the eighties and early nineties, the global energy industry experienced a staffing crisis, as graduates began flocking towards what they perceived as more glamorous careers. Interest in university courses in the technology, computing and media sectors was on the up. Mining appeared low-tech and old-fashioned by comparison and the number of graduates joining the industry dropped as a result.

While the popularity of mining (and of relevant degrees) did eventually improve, the period lit the fuse to a ticking time bomb, which is only now at risk of detonating. Senior managers are approaching retirement age and, as a result of the dip in students entering the profession in the 1990s, a gap at the mid-tier management level is emerging. Organisations that are promoting mid-level management to senior positions are finding a shortage of candidates ready to fill the middle-management roles.

2000s

In late 2007 and early 2008, when the world economies first entered into recession, investors lost confidence, leading to a downturn in the commodity markets. The inevitable result was thousands of workers, from all areas of the industry, losing their jobs.

Financial insecurity also forced massive budget cuts, with marketing and advertising departments suffering most. At the time, the move to cut marketing and employer branding spend seemed logical. After all, there was no need to attract potential employees when redundancies were already being made, but if that decision could be made again, the result might be different – as can be seen by the effects it has had on the industry during the 2010s and into the present day.

2010s

In the short time since global economies started to emerge from recession, the mining market has grown in response to an increased demand for natural resources. This has been particularly true since January 2014, when the first signs of significant investment into new projects were witnessed.

Unfortunately, the events of the 90s and 00s are still making it difficult to meet the demands that new companies and projects are placing upon the industry.

By cutting marketing spend in the 2000s, businesses saw their brand recognition fall. So, as the market now picks up and companies look to grow their staff numbers again, they are struggling to attract candidates. Of course, candidates are also more selective about the roles they take. Those that were previously made redundant quite rightly want and need to protect themselves from similar situations in the future. It follows then that job security is more important for them than ever. They are looking for roles with the promise of long-term contracts, job safety and stable working environments. It is these factors – alongside wages – that have now become deal breakers in the job hunt.

The future

Looking forwards, an increasing global population and rapidly developing markets will place increased demand on mined resources and will further challenge the industry's workforce. The discussion continues here.  

Written by James Holden. Edited by Jonathan Rowland. 

Read the article online at: https://www.worldcoal.com/special-reports/14072014/how_the_-mining_skills_shortage_came_to_be_spencer_ogden_coal1078/