My roots and present associations are with the mining industry — a strike against me, since many of you probably share the popular perception that mining is low-tech, dirty, dangerous, a sunset industry that we don’t really need, a major polluter and despoiler of the landscape.
In fact, it is very high-tech these days. From 1980 to now, the number of people employed in Sudbury’s nickel mines has dropped by two-thirds, from around 20,000 to only some 6,000. However, each one is producing, on average, three times as much nickel. This was attained through innovation, spending in research and development, and advances in technology. Mining is a high-tech industry with more employees with post-secondary education than the so-called “high-tech” sector.
Mining is also a high-paying industry with average weekly wages well over $1,000, compared with the $500-to-$600 average in Ontario. When current employees are surveyed, they respond that they like the high wages and benefits, the safety record (statistics show that it is more dangerous being a civil servant or working for a municipality than being a miner), the hours of work, the job security, and the career prospects.
There is an increasing number of women engaged at all levels. Across town at Inco operations, there are women working underground, as well as others managing mines, smelters and refinery operations.
On average, the Canadian workforce is 2.6% aboriginal; in mining it is 4.5%.
Furthermore, dramatic reductions have been made in reducing emissions. Most of what you see coming out of the big stack is actually steam. The trees and vegetation are growing vigorously once again in Sudbury.
Mining occupies but a small footprint and is only a temporary use of land. These days, when a mine is finished, the site is reclaimed to a natural state. If you are skeptical, try to find the extensive uranium operations that used to be around the corner at Elliot Lake.
Mining is important to the Canadian economy. Ontario alone produces $7 billion annually in new wealth, 74% of which is exported and helps maintain our balance of trade. There are more mining companies based in Canada than in any other country, and the Toronto Stock Exchange is the mine-financing capital of the world.
What about mining’s immediate future?
The world’s population will double to 12 billion from 6 billion by 2050. In the next 50 years, we would need five times the metals already mined in the past 2,000 years if everyone were to enjoy our current standard of living.
The Chinese seem to have had enough of political and cultural revolutions, and decided that it’s time for an industrial revolution. Last year, China surpassed the U.S. as the number-one consumer and importer of copper. And there are more speakers of English as a second language in China than the U.S. has English-speaking individuals.
Each year more than 10 million people in China migrate from villages to cities — the fastest rural-to-urban migration in history. This is comparable to building a city the size of Houston, Tex., every month. Think how much cement and structural steel is needed, how many kilometres of copper wire, and kitchen sinks … .
In 2003, China had a growth of 31% in motorcycle demand, while car manufacturing grew no less than 84%, to 2.1 million vehicles. There are 24 million cars on the road now, and it is estimated that there will be 140 million in 15 years. The latest evidence of the car boom is the gleaming new roads, bridges, expressways, tollbooths and gas stations. This time it is different; this has never happened before at such a pace and scale.
The answer to the question “how long can China sustain these rapid rates of growth?” is that we simply don’t know. There is no precedent. And similar things are happening in India and elsewhere in Asia.
How is the mining industry prepared to deal with this new demand?
Not very well. Real commodity prices have been particularly low for the previous 20 years. It is only in the past couple of years that demand from China and elsewhere is starting to drive prices higher. The industry reacted to those low prices by reducing exploration and development, closing higher-cost operations, and laying off staff. There has been little exploration and few new discoveries. When our operating mines run out of ore, the cupboard is bare.
Half the 22 mining engineering schools in the U.S. closed during the past 20 years. Canadian schools have also witnessed low enrollment. The trend in worldwide student enrollment indicates that nowhere near enough will graduate to satisfy industrial needs. In Australia, for example, several mining projects have been cancelled owing to lack of staff.
The same trend is happening here. More than 40% of mining personnel will retire in the next 10 years, not just in Canada but worldwide. Reflecting the new boom in commodities, the Canadian mining sector witnessed twice the overall growth as that of the Canadian economy during the past two years. This sort of growth has mining companies scrambling for employees.
We can estimate the Canadian “supply gap” by making several assumptions: the industry’s employment growth continues at a rate of 3.4%; today’s retirement pattern will continue; and 70% of mining grads will actually go into mining. Using these assumptions, there will be a “gap” of at least 6,300 employees per year in Canada alone.
The only “fix” is either to increase productivity per employee or steal employees from other sectors by offering higher salaries. China and India’s populations are not going to want to lower their standards of living. Since it takes at least 10 years of exploration to discover a new mine and another 7-10 years to get it into production, high demand is likely to exist for the next 20 years or so.
Laurentian is unique among universities these days in having decided to specialize in mining-related disciplines. We are already world leaders in exploration research, mine planning, automation and tele-robotics, environmental disciplines, and deep mining.
We are working to establish an internationally recognized “Centre of Excellence in Mining Innovation,” right here on the Laurentian campus.
— The preceding is an edited version of a speech given during the 2005 Convocation ceremony at Laurentian University in Sudbury, Ont. The author, who received a honourary doctor of law degree during the ceremony, is Ontario’s assistant deputy minister of mines and minerals.
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