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EMERGING SKILLS SUMMIT 2020 AND BEYOND A Critical National Challenge

EMERGING SKILLS SUMMIT 2020 AND BEYOND A Critical National Challenge. “ SUSTAINABILITY OF THE MINERALS SECTOR IN AUSTRALIA, SKILLS NEEDS IN A GLOBAL INDUSTRY ”. Don Larkin, CEO, The AusIMM Tuesday 22 November 2005, Sydney NSW.

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EMERGING SKILLS SUMMIT 2020 AND BEYOND A Critical National Challenge

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  1. EMERGING SKILLS SUMMIT 2020 AND BEYONDA Critical National Challenge “SUSTAINABILITY OF THE MINERALS SECTOR IN AUSTRALIA, SKILLS NEEDS IN A GLOBAL INDUSTRY” Don Larkin, CEO, The AusIMM Tuesday 22 November 2005, Sydney NSW

  2. “DISCIPLINE AREAS OF NATIONAL IMPORTANCE WILL BE PROTECTED WHERE THEY ARE OF CONTINUING RELEVANCE” Draft National Strategic Principles for Higher Education – September 2006 Department of Education, Science and Training

  3. TODAY’S PRESENTATION • Profile of the Minerals Sector – National Importance • Human Capital Availability and Changing Structure of Workforce • The Minerals Sector and Human Capital • Implications • Suggestions to Address Skills Shortages

  4. PROFILE OF THE MINERALS SECTOR Global Industry – Global Options Cyclical Industry – Currently Buoyant Centralisation of Ownership with World Wide Commodity Groups Emerging Sources of Supply – Increasing Competition Increasing Demand from China, India, Asia Corporate and Social Responsibility – High on the Agenda

  5. PROFILE OF THE MINERALS SECTOR IN AUSTRALIA 2003-4 – 8% of GDP - $500 Billion directly to Australia’s wealth over the past 20 years Exports - $42 Billion ($67 Billion 2004/5) representing 35% (37% 2004/5) of (Australia’s total merchandise exports and 28% of total exports of goods and services Exports of mining technology, equipment and services of approx. $2 Billion (60% of the mining software used in operations around the world) 24% of private new capital expenditure in Australia Total government revenue payments of $4.6 billion Significant infrastructure development – since 1967 – built 26 towns, 17 ports, 26 airfields and over 2000 km of railway line. Source: MCA Annual Report 2004

  6. GLOBAL SIGNIFICANCE OF THE AUSTRALIAN MINERALS SECTOR Largest exporter of iron ore and black coal Largest producer of bauxite, alumina, diamonds (by volume), ilmenite, rutile and zircon Fifth largest producer of aluminium and coal Second largest exporter of uranium with the world’s largest resources of low cost uranium Second largest producer of zinc ore Third largest producer of iron ore, nickel andgold. Source: MCA Annual Report 2004

  7. MORE PROFILE ON AUSTRALIAN MINERALS SECTOR • High Technology/Capital Costs – Low Labour • Current Contribution to GDP per Employee is $359,000 compared with average all Industries approx. $70,000. • Homogeneous Culture with Low Level of Diversity – Causes Retention Problems • Breakthroughs Imperative to find Next Generation’s Resources, Increasing Value (Recovery) of Existing Resources whilst ensuring Economic Efficiency, Protection of Environment and Social Development. • Where will the Investment Come From?

  8. HUMAN CAPITAL AVAILABILITY • Science and maths teaching in primary and secondary is decreasing (geoscience) and quality of teaching is declining. • Students are attracted to “easier” options • Attractiveness of career in remote or regional Australia is low • Greater awareness of impacts of cyclicity. • “Demographic Destiny” – ageing population – sellers market.

  9. THE CHANGING STRUCTURE OF AGE Implications of an Ageing Australia, Productivity Commission April 2005

  10. The Age Chasm – Drake White Paper Volume 2, No. 5 Successfully Managing Age in your Organisation As the population ages a fault line is emerging that separates the past and future landscapes of the Australian workforce. For the foreseeable future, growth in the supply of labour will be firmly concentrated in the group aged 45 years and over. For every new young person entering the labour market today, there are seven people aged 45 years and over available. By 2010 this will create permanent shortages in the Australian Labour Market forcing organisationsto dramatically re-think their employment practices.

  11. New entrants to the labour marketDiminishing Access to Labour 1980’s & 1990’s 2020’s and beyond Access Economics

  12. Need to engage more younger workers. Potential to maintain engagementof older workers CURRENT PROJECTED Source: ABS, 2001

  13. Key Risks (Drake) • Increased competition for labour • Expansion of skills shortages • Increased competition for younger people • Increasing mismatch between the available labour pool and the competencies and characteristics required • Loss of operational knowledge, due to low retention rates and exit to retirement • Loss of executive knowledge, due to exit to retirement • Impaired productivity consequences • Falling or stagnating growth • A shifting landscape of health and well being • Limited capacity amongst the organisations managers and leaders to assess and respond to the changed environment

  14. FINALLY From The AusIMM’s point of view Seize the Opportunity in Tertiary Education by Focusing on Discipline Areas of National Importance as Outlined in the National Strategic Principles for Higher Education to Ensure the Sustainability of the Minerals Sector in Australia by Backing a Winner and this does Require Some Interventions.

  15. www.ausimm.com

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