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WA miners are searching for workers, but this time without ‘mercenary-type salaries’

Source: ABC News

Recruitment specialists say mining companies, desperate for workers in remote areas, are again turning to FIFO workers from the eastern states, but are unlikely to pay the sky-high wages seen in the last big boom.

After a flat few years, the Western Australia resources sector is picking up, and there are currently $1 billion worth of new projects and mine expansions in the pipeline in WA.

Mining towns like Kalgoorlie are crying out for workers, with local Chamber of Commerce and Industry head Kyran O’Donnell saying the future of major projects is at stake.

“We are going through obviously a huge growth phase,” Mr O’Donnell said.

“There are new open-pit operations starting up all over the place, there are underground mines kicking off, and that’s obviously putting a strain on the resource sector because there’s the growth but not the people to fill these roles.

“Companies are spending tens of thousands of dollars on exploration but obviously if we don’t have people to operate their mine they might pull back on those investments.”

Previous wage explosion ‘unsustainable’

So what will companies be willing to pay to lure workers across the Nullarbor?

Between 2007 and 2012, as the iron ore price surged and miners went on a construction blitz, the WA mines became the place to go to find your fortune.

Mining companies were willing to pay for elaborate FIFO rosters from as far away as New Zealand and Bali, and relatively unskilled workers in their 20s earned hundreds of thousands of dollars a year.

That is unlikely to happen again, says Perth-based recruitment specialist Chris Kent.

“The wage explosion that happened back then was unsustainable, and that was because we were buying the talent,” he said.

“We were getting [workers] with high wages, but it also means that what goes up comes down, and it cut deep when mining companies had to shed workers when the commodity prices came down.

“People may choose to live in Bali and work in the Pilbara now, but they’re probably only being flown form Perth to the Pilbara for their swing, and making their own way to Bali.

“Whereas in the past, if they were a good enough employee and did a good job, then they probably would have been able to negotiate more than that.”

But he said there has been a resurgence in eastern state FIFO arrangements, as companies try to plug gaps in the Pilbara and Goldfields.

“There’s already evidence to suggest that some of the major miners are willing to fly people from the east coast for work, which I don’t think they want to be doing, as it can push up the cost of these projects and operating these mines. But they need to fill these vacancies,” he said.

Mr Kent, who oversees Hays Recruitment’s WA division, said the priority needed to be attracting people and families willing to commit to living in WA long-term.

“It doesn’t benefit anyone having unsustainable spikes in salary, because it actually brings people for the wrong reasons. You end up having to pay the mercenary-type salaries,” he said.

“You want people who are here for the best interests of the workplace or the economy they’re in, and having to fly in the big-hitting talent from other places, who are only here to make a buck and then move back out again, is never a good thing for the self-esteem of an office or a state or whatever it may be.”

‘Don’t over do it’

The $1 billion in investment detailed in the WA Department of Mines, Regulation and Safety’s latest industry snapshot includes new iron ore, rare earths and lithium mines, as well as re-openings or expansions of existing projects.

Deloitte economist Chris Dawson says that while everyone is wary of using the word “boom”, the mood is buoyant.

“Western Australia can move really fast. You have these brilliant booms but it also has nasty busts,” he said.

“Right now, the mood is up, the vibe is good and momentum is starting to build.

“But you have had recently some senior figures counselling caution — ‘Don’t overdo it’ — and I would see it as sensible, because a more careful, more modest recovery is a good thing, for Western Australia and Australia.”

He says the government-driven construction on the eastern seaboard is creating stiff competition for employers trying to lure people west.

“One of the challenges at the moment is getting those people with the right skills, the right experience, and a bunch of those people are working on the big infrastructure jobs that you’re seeing in New South Wales and Victoria at the moment.

“They may have been burnt by the last boom, if you like, in the west. So it’s not an easy labour market.”

Demographer Amanda Davies, who published a book about the impact of boom-times on WA, says there are some factors that will work in WA’s favour.

“On the east coast there are some push factors at play. The cost of living is very, very high, and people are getting increasingly frustrated about the transport and housing costs and the job opportunities,” she said.

“The nature of a mining economy is that there will be periods of boom and bust and I think that’s quite well understood. You get in while it’s going good and then you make plans.”

‘There are so many opportunities here’

In the historical streets of Kalgoorlie, still dotted with the large, lavish limestone hotels funded by the 1880s gold rushes, it appears word is getting around.

At the Kalgoorlie Caravan Park, which offers budget accommodation, owner Kirstyn Johnstone is dealing with a steady stream of new arrivals, arriving hungry for work.

“At the moment it is so busy. There are people arriving from everywhere, including Africa, but also people from Victoria, Queensland and Tasmania all saying there are no jobs at home,” she said.

“So they’ve come over here, they’re going to test the waters for a year, and bring their families over if they like it.

“It’s just what Kalgoorlie needs, because there are so many opportunities here.”


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