American Mining Companies and an Aging Workforce
With the US economy still in growth mode and the Mining industry experiencing a rebound (having increased production by more than 14% in the past year), it appears from the outside that everything is trending in the right direction. However, there is lingering uncertainty regarding the future of the mining industry, primarily due to the fact that future labor shortages are not only possible, but expected. The types of shortages expected are creating complications for those of us in HR: modernization of the industry, an aging workforce, and the need for high-tech talent and exploration jobs are producing problems that go beyond recruiting to fill typical vacancies.
Mercer’s 2018 North America Mining Survey found that 67% of respondents said they’re already concerned about the aging workforce and rightfully so. Additionally, only 56% of survey participants said they feel confident in their talent pipeline — meaning nearly half of them don’t. When asked which groups of employees have the largest talent-pipeline gaps, 100% of survey participants listed Technical Professionals as one of their responses. This was followed by Site Managers, Foremen, Superintendents,” which 75% of participants selected as one of their options.
Silver Tsunami Will Cause Disruption Sooner in Mining
“Silver Tsunami” is a phrase that’s sometimes used to describe the country’s aging population and how it affects various parts of society, especially the workforce. And for all intents and purposes, data shows that America is very much in the midst of this metaphorical tsunami as the boomer generation continues to reach retirement age. The Bureau of Labor Statistics currently estimates that 25% of the entire US workforce will be over 55 in 2020. Within mining, the issue of an aging workforce will likely come to a head sooner than in other industries given that the median age of the mining industry is 44 years old, which is two years higher than the median age of the US working population overall.
One of the largest populations in mining, critical to operational success, consists of the site managers, foremen and superintendents. Recent survey data shows that within those jobs, over 20% of the population is over the age of 60. Coupled with the insight that most organizations already consider this area to be one of their largest talent-pipeline gaps, the urgency to plan for these positions in the future only intensifies.
If you’re an HR professional in the mining industry, what does this mean to you?
Mining’s Talent Strategy Considerations
On the face of it, the effect of an aging workforce may seem simple: make sure you take care of your employees as they retire and prepare to hire. But it’s not quite that simple.
First off, not all of those reaching retirement age will be retiring. In the US, 75 % of people plan to work past retirement and of those, more than two-thirds plan to work part time. Mining companies will need to consider when it makes sense to encourage retirement versus transitioning older workers into alternative work arrangements, such as part time or temporary during times of high demand.
What about knowledge transfer? A vast amount of industry and organizational knowledge will walk out the door with these retiring workers without the proper transition plan in place. Or alternatively, some older employees may decide to continue on in leadership roles in the organization, past retirement age, creating bottlenecks in career paths or succession challenges for the employees seeking new roles. Both these issues can be addressed with a well-crafted career architecture that is supported by succession planning and learning and development programs.
Compensation, oftentimes cited as the number-one way in which employees are positively impacted at work, becomes even more critical for mining companies to ensure they continue to attract, motivate, and retain employees. Of particular concern are the technology jobs — there is a gap in the talent pipeline, and the competition is fierce. Creating competitive compensation packages by tracking competitor pay through the use of salary surveys is a must when seeking to attract talent in this tight job market. Along with that, as an HR professional in mining, you’ll need to consider evaluating how to attract and retain tech talent to mining when competing with other, “sexier” industries. Among the many things you can consider are:
- What can you do to make your organization more innovative and attractive?
- How can you upskill existing employees for new technology?
- Do you have tools in place to provide long-term career development and advancement for high-tech talent?
Need More Information?
The North American Mining Industry Survey Suite can provide valuable information related to mining talent and compensation strategy. The survey suite features data from 155 positions and 32 organizations and is organized into three modules, allowing you to customize your survey purchase to just the data you need: Corporate and CEO, Mine Site, and Mine Site Operations. Additionally, Mercer’s consultants are happy to help you shore up your talent strategy as the Silver Tsunami starts to break ground.