Cross posted from Peak Jobs Analysis
by Shane Granger
I am going to commence with a prediction. Australia reached its Peak Jobs Mining moment in May 2012 when the industry recorded a total workforce of 275,500. The more than 10% decrease in mining employment in the most recent ABS update to 237,400 gives the first clear indicator that the sector is looking to return to a >200,000 labour force, not seen since November 2010 and faster than previously expected.
The month of September 2014 was a bad one with another 2,500 jobs lost. This is the third month, out of the previous four where more than 2,000 jobs were lost. As Julian Poniewierski commented in my previous update my numbers are more solid than others but still cannot capture the ‘death by a 1,000 cut’s’ job cuts that are currently underway across in industry at the moment. I agree with him. Often I can capture these numbers in annual reports or via other documentation but this type of reporting occurs either annually, irregularly or not at all. It is also a lagging indicator and another mechanism utilised by the industry to massage its employment narrative.
Here are the charts for Australian Mining Employment through to the end ofSeptember 2014.
The opening infographic looks at total job gains and losses by State or Territory for the month of September. Where a job cannot be affixed to a certain site then the losses or gains are attributed to Australia (Non Specified).
Data-Points: Queensland was hard-hit this month with significant job losses across the BMA network and the announcement of the mothballing of the Isaac Plains coal mine (although these jobs will move out to early 2015 when confirmation comes through of the mine goes into care and maintenance). In other news the ALS Laboratory group announced that it would cut 1,000 jobs.
The first employment chart looks at the previous year from a total mining employment gain and loss perspective. The positive employment numbers are split into those that reflect infrastructure (tan) and operational (blue) gains. Job losses are then split into operational (red) and mining services (maroon). Mining services can include mining specific service centres, distribution, back-office functions and transport.
Data-Points: Big losses in both coal mining (BMA/Isaac Plains) and mining services (ALS) this month while some positive news from Western Australia where 400 jobs were created with Downer signing new work with Gorgon Gas. A wafer thin line of operational jobs were also created.
The next employment chart looks in more detail at the main resource types (Iron Ore, Coal, Gold/Copper, Zinc/Lead/Nickel, CSG/LNG and Uranium) by either a job gain or a loss.
Data-Points:
- Coal lost another 1,250 operational jobs making this the 27th consecutive month of losses in that resource type;
- Iron Ore recorded another 100 jobs lost making this 3 from 4 consecutive months of losses in that resource type.
The last chart tracks employment gains and losses sentiment and is now back dated toJuly 2011.
Data-Points: Sentiment continued a return to negativity obviously driven by a number of large job cuts and mothballing of mine announcements during the month.
Another interesting point is that now I’ve pushed back the sentiment to Q3 2011 you can see a three quarters of positive sentiment. That time represents the sustained of growth following the global recession driven by the massive stimulus package implemented by the Chinese several years before.
Juking the Stats Award (September 2014)
BHP Billiton wins my award for the mining company that most ‘Juked the Stats’ in September. The award is not giving for cutting jobs this month but for its intense media management after the death of one of its workers at the West Australian Worsley Alumina facility. BHP Billiton is the biggest of players so if you get fired or die on site, don’t expect much love or commentary outside of the usual empty platitudes. If you don’t believe me you can review there detailed Press Release after the most recent incident.
Summary
With iron ore now under $80 for the first time you can’t help but wonder when the real job cutting in that resource type (and that gets noticed) will happen. Maybe next month…
Data Sources
[1] Australian Bureau of Statistics. 6291.0.55.003 – Labour Force, Australia, Detailed, Quarterly, Aug 2014. Accessed 1 October 2014.