The DNA of the CFO wheel
“There is no easy fix to the skills shortage issue, but being creative and flexible in your approach can open up new pools of talent.”Louise Rolland
Executive Director, Advisory, Ernst & Young
The acute skills shortage seen in Australia and Canada has spread to more places during the past year, with projects in Indonesia, Mongolia, Brazil, Chile, Peru and Mozambique all plagued by this challenge.
Strong commodity prices and confidence in the long-term sector fundamentals have reinvigorated investment in mining and metals to quickly develop new projects or ramp up production from existing ones.
This increased investment is in turn driving demand for skilled workers around the world and drawing on the same global pool of talent. The risk is that this could slow growth and increase costs.
Significant risks associated with skills shortage include impact to production, project delays, and increasing labor costs.
Identifying, attracting and retaining critical operational and construction skills remains a top priority for the mining and metal sector.
Companies need to understand what is important to their targeted workforce and be creative in providing not only an attractive compensation but also a range of additional employee benefits. (see table)
Innovative approaches used by organizations include:
- Differentiated employee value proposition — to retain employees, companies are offering not only attractive compensation but also individually tailoring non-financial benefits
- Accessing non-traditional and underrepresented labor pools — such as women and indigenous communities
- Resources from other sectors — companies are hiring resources from industries with similar and/or complementary skills, such as oil and gas, and manufacturing
Steps mining and metals companies can take to respond to this risk: |
- Source skills from aligned sectors and a broader demographic
- Account for demographic and diversity factors when making investment decisions
- Initiate programs that encourage semi-skilled and retired workers to re-enter the work-force
- Target initiatives to retain critical skills held by older workers close to retirement
- Create employment packages focused on career development opportunities
- Implement early labor scheduling and sourcing within mine planning
- Develop sustainable skills development programs to fill these gaps
- Develop strategic alliances with institutions and communities
- Target initiatives to optimize productivity
- Substitute capital for labor through innovation
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