Late last month an email from Erin landed in my inbox. The atypical subject line caught my attention. Sex talks... What on earth could this have to do with the very serious subject of mining the precious metals!?
A lot it would appear! This was on REUTERS! So very serious, global and important, read the body of Erins email. Such is the shortage of qualified professionals, engineers, geologists, miners etc that they have to be treated like gold dust themselves. So now they have their own agony aunt!!
Agony aunt initiative to boost productivity
Intrigued, I read on. The story on Reuters related to an Australian initiative called Toolbox Talks. This is being run at the Bulga coal mine in Hunter Valley, north of Sydney. The news goes that Australian coal miners are being taught to explore their wives, like they did when they were 18, and understand the menopause! This, apparently, will lead to a healthy sex life which in turn will make them happy, productive workers.
Now, we are not having a laugh here. The Toolbox briefings are on a different topic each month and have included advice on nutrition, fatigue, prostrate cancer and heart disease. Indeed the Talks have been so successful that, Xstrata, a global diversified mining group, is considering extending the initiative to its other pits. Bulgas miners, who are in their 40s and 50s, are even beginning to share their newfound knowledge with colleagues.
Xstratas management firmly believe that miners with a healthy and happy sex life will be more productive? Now, who would have thought the mine bosses would be so touchy feely?
Skills shortage no joke
But before we dismiss this out of hand, perhaps Xstrata is on to something. Mining is, after all, an increasingly stressful career. The commodities boom is running like a cheetah. Demand, and consequently the price of the metal, is surging. But resources are becoming harder to find. Many companies are digging deeper, and this comes with new dangers.
Added to this is the fact that the mining population is ageing in many parts of the world. A large proportion are over fifty. So you can see why mine bosses are hanging onto their staff for dear life. You only have to click through the jobs pages of any mining website! There are literally thousands of jobs to trawl through. And the packages are increasingly competitive.
Take Canadian miners. Forty percent of its mining workforce is expected to retire pretty soon. Over the next decade 90,000 mining vacancies are expected to become available.
In Quebec alone some 4,000 jobs are up for grabs. And that includes 2,500 new opportunities due to renewed exploration and the revisiting of closed mines. In fact, the Canadian mining industry is enjoying such a boom that miners are being termed the new rock stars. Generous salaries and signing on bonuses are among the incentives being offered.
Even retiring miners are being coaxed to work part-time. Teck-Cominco is expected to lose 9,000 of its Vancouver-based workforce to retirement in the next decade. It plans to offer retirees part-time work whilst they still draw a pension.
This might be good for prospective and existing employees. But it means that labour costs are going through the roof.
Global competition for staff
Australias mining machine is also struggling with labour shortages and that is hitting profits, says a report by the National Australian Bank. Over the next year one of the most challenging conditions facing the industry is a shortage of skilled labour.
No wonder the Minerals Council of Australia (MCA) has recently launched its Now Hiring Campaign. The campaign is aimed at recruiting 26,000 skilled workers for the mining industry over the next decade! According to the MCA Australias mining industry will need some 70,000 additional workers by 2015.
Australias hiring campaign is a bit of a worry for South Africas Chamber of Mines. South Africa, too, has a skills shortage (around a 40% shortage of artisans). Many skilled South Africans have already left for Australia. The climate and lifestyle are said to be similar - but without the stress. As anyone reading our diaries knows, the South African environment is increasingly challenging.
Tanzania is another African country that is finding it hard to retain skills. The manager of Tanzanias Geita mine, owned by AngloGold Ashanti, recently complained about it. The mine had lost some its best geologists and technical staff to mines in Australia.
Apparently some 38 skilled Tanzanians have fled to greener pastures, many to high profile companies like Rio Tinto. Even locally, competition to retain staff has become much stiffer. There are now five gold mines in Tanzania. Now AngloGold is worried it might lose skilled technicians to mines run by the worlds biggest producer Barrick Gold.
The mining skills shortage is without doubt a major challenge for companies desperate to capitalise on the run in commodities. You cant get the metals out the ground if you dont have the staff. And if you have to pay a premium to keep staff, that impacts on costs and profitability. Shareholders should be paying particular attention to production costs.
So maybe, just maybe, Xstrata has a point. As Erin says, companies aiming to get the best out of their existing staff by improving conditions can only be a good thing!
Keep mining...and keep the staff!
Erin and Isabel
