People Issues Will Dominate Your Future

It is hard to devote time to plan for the future when you are up to your neck in survival but the future will be here before you know it. For leaders in the mining industry it’s going to continue to be a bumpy ride but being prepared will help.

We have written in these pages previously and you have heard The Mining Industry Human Resources Council (MiHR) of Canada, the Mineral’s Council of Australia and now Ernst and Young warn of the coming talent shortage. Just to be clear shortage in this context is approaching 100,000 people in each of Canada and Australia by the end of the decade. The reasons are well known; an aging workforce, shrinking talent pool, failure to hire during past recessions, skills leaving the industry blah, blah, blah.

That’s mining. We have been there before and will be again and every time recovery is forecast they say it’s going to be different and harder. This time they may be right and here’s why hoping for the best may just not be enough.

Here’s why old standby solutions will not work:

• Baby Boomers – The ultimate stop gap workforce and the trusted “safe hands”. They have long filled temporary and part time gaps mentoring the new guy, establishing the overseas plant, working the investor network and so on as they edged toward retirement. They have been gone for five years now, many are not coming back and even if they were how current are they. New employees are demanding a different type of leadership and professional development
• Higher Pay – This was the solution in the last shortage. There were structural reasons for that happening but higher pay as an attraction tool only works if there are enough skilled people. Boomers were keen to shore up damaged pension savings. Generations that follow have different expectations and will avoid the resulting internal inequity and revolving door culture.
• Outsourcing – was embraced as a solution to skill set shortages. Payroll, training, and research savings were realized. Doing one thing frequently improves efficiency but these companies too will have the same staffing challenges. Purchases due diligence will now need to include a skills audit to ensure the supplier can complete the prescribed task.

There will be fewer personnel available with the skills that you are going to need and the market will not bear the high costs that it did previously. Mining is going to have to get smarter in meeting talent needs.

Engineering no longer attracts sufficient numbers of undergraduates. The Camborne School of Mines for example has temporarily shuttered its Minerals Engineering course. Chris Stafford recently wrote in the Northern Miner how important building bridges with educational establishments was going to be for the industry in the future. Younger managers with working spouses and shared parenting duties will be less willing to relocate or fly in/fly out demanding more support from employers.

The changing expectations that younger employees have from an employer means that mining companies are going to have to be a lot smarter about the way in which they attract and retain scarce skills. Hiring rapidly in an upswing and shedding staff on the downturn is no longer going to be acceptable or affordable.

In summary:

• Warnings of previous talent wars were overblown and this one might be too. This time however, the fact base is different and a strong likelihood that the old solutions will not work
• Factors outside the industry cycle are going to compound talent shortages and the mining industry will need to catch up to other industries in adapting workplace culture
• A talent plan is required – in case we are right. If we are not, it will still be a highly useful tool and a smart thing to do
• This is important and warrants Board oversight. Compensation Committees are becoming Human Resource Committees.

The mining industry has never really embraced human resource skills (miners being natural leaders ahem!) above site safety and workforce management. Addressing the unfolding changes in workplace culture combined with a talent pool shortage is likely beyond the experience of the HR staff justified by midsize companies. An experienced practitioner working temporarily and part time with your HR team may help senior management and the Board tailor a plan that will protect and even improve productivity.

Ask how by emailing paulpittman@thehhumanwell.com, an HR rental solution might help you or by calling 905 842 7916