Skills shortage is top industry concern: Gold Fields
JOHANNESBURG (Reuters) - A worsening shortage of skilled workers is the top worry for mining executives globally as the industry presses ahead with projects in increasingly tough and remote places, the chief executive of world No. 4 gold producer Gold Fields (GFIJ.J) said.
"A lot of people ask me what is my biggest concern. What keeps me awake? Having skilled people available to do the job and go to locations that ordinarily they might not be too keen to go to," Nick Holland told the Reuters Global Mining and Metals Summit on Monday.
"That is one of the biggest challenges. We are looking to build a whole lot of mines in the future. And getting the right skills to build those mines is a challenge, not only for us, but for the various engineering companies," he said.
The Gold Fields project pipeline ranges from Ghana in West Africa to the Philippines.
Holland said part of the problem was demographic. The average age of skilled professionals in the industry, from engineers to geologists and mine planners, is widely estimated at 50 or above.
"The baby boomers are starting to get to retirement age. And there is a whole lot of them that are going to disappear very quickly," he said, referring to the generation born in the two decades that followed the Second World War.
"If you look at the youngsters coming through, they are looking at other industries," he said, naming finance and telecoms as examples of industries that university graduates are finding more attractive.
He said many trained miners had also sought greener pastures in the world of finance.
"If you look at most of the gold analysts and a lot of the gold fund managers, where do they come from? They were trained by us, companies like Gold Fields," Holland said at the summit, held at the Reuters office in Johannesburg.
"They were trained by the industry, but they decided it's a nicer job to wear a suit every day and go around talking to fund managers, as opposed to trying to figure out how you can get a new mine to deliver its potential," he said.
The issue is taking on added significance as miners explore and develop projects at a time of increasing costs and growing logistical complexity. Holland said, however, that building remained cheaper than buying existing operations, despite company valuations at close to historic lows in the gold sector.
"If you look at the cost of building, discovering, developing a new mine, it's still very, very much cheaper than trying to buy. For every ounce you buy, you are probably paying between 10 and 20 times more," Holland said.
The search for resources has also pushed miners into remote and rough areas where assets can be lucrative, but political risks are ever present - a point driven home by the coup last week in Mali, Africa's third-largest gold producer.
Holland said the miner had suspended drilling at an exploration project in Mali out of "an abundance of caution".
(Editing by Jane Baird)
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