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Published 31 May 2012 00:08, Updated 31 May 2012 05:00
There were two events that hit the headlines this week that on the surface appeared unrelated but actually have a common thread.
The first was the announcement that Gina Rinehart would be able to import 1700 workers under an enterprise migration agreement to work at her Roy Hill mine in the Pilbara. The second was the announcement that the listed engineering company Hastie Group was to go into receivership owing a reported $500 million to banks.
The Gillard government’s decision to approve Rinehart’s offshore hiring binge set off a predictable political firefight, with the government jumping through hoops to assure its union base that local workers would not lose out. It would be better, though, if the government called it as it is: the mining boom needs more skilled labour than is available in Australia. While it may seem as though those that have been made redundant on the economically depressed east coast could immediately be flown to Western Australia, the truth is that the big bucks mining offers haven’t been enough to tempt enough workers from the east. According to the Australian Bureau of Statistics, only 6000 people relocated to WA in the past financial year, while overseas workers are coming in droves.
Rinehart’s move isn’t just about cheap labour, it’s about labour per se and the unions, if they could stop frothing at the mouth about the enterprise migration agreement, should focus on retooling the skills of their membership working in older industries. However, the mining industry doesn’t escape blame. It’s been making handsome profits for the past decade and seems incapable of spending enough of that money on programs that would ensure it has the skilled labour it needs.
While crying poor on labour, the mining industry has left it up to the government to initiate skills programs, which it hasn’t been able to do fast enough. It may be madness to expect unions and the miners to work together on training workers from dying industries, but imagine what a magnificent workforce we might have if they did.
Meanwhile, the potential demise of a listed engineering group during the biggest ever mining boom is slightly incongruous. Surely with engineering skills in such demand, the profession should be riding high. But it’s apparent that the engineering industry has two speeds: firms in Perth with specific mining skills are in demand (although they seem unable to keep their best people from joining mining companies) while firms in NSW and Victoria that specialise in other areas are struggling. The Hastie Group had specific management issues but it was also in the slow stream, specialising in office towers, apartment blocks and hospitals, rather than mining services.
So what do these two events have in common? They show what happens if you don’t have a flexible enough workforce or businesses that are able to restructure to meet the demands of a changing economy. Workers on the east coast can’t complain about Rinehart hiring overseas labour if they aren’t prepared to move west.
Meanwhile, companies that don’t retool quickly enough to shift into booming sectors will get into trouble. Everyone knows the economy is shifting. As an employer or employee, the worst thing you can do is bury your head in the sand.