Mining companies are implementing new strategies to recruit younger workers into an aging workforce amid a tight labor market, executives said during first-quarter earnings and investor calls.

As the mining sector expands operations to meet booming demand for metals and minerals critical for the energy transition, companies are struggling to find the skilled workers needed to fill open positions. And with the industry's existing workforce getting older, companies are actively seeking out potential new workers and are willing to train them into the industry, while offering a host of other benefits.

In the US alone, employment in the mining sector has only increased 3.3% from 2016 to 2022, according to preliminary data from the US Bureau of Labor Statistics, carried by metal ore extraction, in which employment rose 14.4%. By comparison, employment in construction rose 17.9% over the same period.

"As I talk with other CEOs in the business roundtable, everywhere people are experiencing it. Some of it grew out of [COVID-19], in the way people are approaching life/work styles as they go forward. But it's a real issue for us, and we're attacking it by aggressively recruiting people," Kathleen Quirk, president of Freeport-McMoRan Inc., said April 21 during the company's first-quarter earnings call.

Quirk said the company is also pursuing "automation initiatives" that will "make our business less labor intensive" amid an ongoing US labor shortage that the company said is worse than those in other major mining districts such as Peru, Chile and Indonesia.

Companies are also feeling the pinch as the labor shortage drives up costs. South African miner AngloGold Ashanti Ltd. has not had any decrease in labor inflation, according to Alberto Calderon, CEO and executive director.

"On wages, it's still around five, six percent," Calderon said May 12 on an earnings call.

Tight in US

The problem appears acute in the US, where Freeport-McMoRan CEO Richard Adkerson called it a "real issue," and companies are expanding their recruitment efforts and the range of services available for workers.

For example, construction of the Lithium Nevada mine, also known as Thacker Pass, will require over 1,000 skilled workers, and operations will require 500. To prepare, the company is offering job readiness training to local communities and tribes, and "recently signed a [memorandum of understanding] with North America's Building Trade Unions to negotiate a project labor agreement," a spokesperson for Lithium Americas Corp. told S&P Global Commodity Insights in April.

The spokesperson noted that "workforce development and housing are two leading challenges we are addressing." The company plans to build a temporary hub in nearby Winnemucca, Nev., to house workers during construction.

After facing similar workforce issues in Nevada, Barrick Gold Corp. is targeting fresh engineering graduates through job fairs and opened training centers to attract job seekers.

"We made a strategic decision to not continue to chase the ever-decreasing, ever-aging traditional mining skill pool and to go and invest in younger engineers and skills. And we've been extremely successful in that endeavor," Mark Bristow, company CEO and president, said during a May 3 earnings call.

Bristow said its targeted potential workers are more apt to acquire skills in areas like artificial intelligence and data analytics. And the company has begun offering benefits such as childcare to retain workers.

"We're looking at being innovative, and it's driven by our commitment to be Nevadan-focused as far as employment goes. And again, our percentage of Nevadans in our workforce is significantly up," the executive added.

And the world

Miners in Australia face a similar labor shortage. At MMG Ltd.'s Rosebery mine, zinc production dropped 18% and lead production decreased 27% year over year, partially due to staffing problems, Liangang Li, the company's interim CEO and executive director, said during an earning call April 27.

Geraldine Slattery, BHP Group Ltd.'s president of Australian operations, said during a special call March 16 that BHP has increased the number of its directly employed workers to 50,000 from 30,000, which gives more workers access to the benefits and other resources available to its internal workforce.

"We believe we offer quite a competitive reward proposition but also a culture," Slattery said. The mining giant is also offering training programs in Western Australia and Queensland.

In Canada, Newmont Corp. has been focusing on recruitment "and also just really making sure that our current workforce is turning up for work," Rob Atkinson, executive vice president and COO, said on an April 27 earnings call.

"Those are both paying off a very significant dividend. The situation we had last year is vastly different this year," Atkinson added.

Even with all the initiatives, companies still worry about meeting production goals, given the labor pressures.

Coal miner Peabody Energy Corp. expects that the tight labor market will be one of the major bottlenecks to ensuring sufficient supply of thermal and metallurgical coal for the seaborne markets over the next couple of years.

"We see demand growing ... and the constraints to supply growth that have been there are still there: access to new capital, permitting, ESG pressures, lack of hiring employees," Jim Grech, CEO and president, said during Peabody's first-quarter earnings call April 27.

A weak workforce could likewise compromise the lithium industry's ability to meet "current production targets and expansion goals," Paul Graves, Livent Corp.'s president and CEO, said on a May 2 earnings call.

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