The resources industry is bracing for more job cuts amid concerns weaker iron ore prices could add to the woes in green hydrogen, nickel and lithium.
Chamber of Minerals and Energy WA boss Rebecca Tomkinson said governments needed to respond and alter policy settings in the face of structural changes in mining and potential downturns in commodity prices.
Ms Tomkinson pointed to rising energy costs and increasing green tape as threats to investment and jobs.
Perth-headquartered Fortescue will axe 700 jobs over the next 12 days on top of about 7000 job losses across the nickel industry in WA since last year.
Australian Bureau of Statistics figures show the number of people employed in the WA resources sector has fallen by 18 per cent over the past year to 144,900. The plunge in jobs follows several years of growth and has been cushioned by gold prices hovering at record highs.
This being so, official figures released on Thursday showed WA at near full employment, with unemployment at just 3.8 per cent, in an indication that so far, miners have been able to find other work.
Diversified miners such as BHP and Chris Ellison’s Mineral Resources have gone from hiring to trying to accommodate displaced workers. BHP is offering jobs in iron ore, copper and coal to workers displaced from its loss-making nickel operations in the west.
MinRes said last month that it had almost 800 job vacancies across the business. It is understood the company has stopped hiring after promising alternative positions to about 1000 workers hit by the shutdown of high-cost iron ore mines in WA’s Yilgarn region.
There is still demand for some difficult-to-fill blue-collar roles, including heavy diesel fitters.
Fortescue is targeting white-collar workers with cuts expected across the company’s iron ore mining and green energy divisions.
In nickel, seven out of 10 operational mines in WA have moved into care and maintenance in the past nine months with just Glencore’s Murrin Murrin mine and IGO’s Nova and Forrestania mines still standing.
Rising energy costs
Glencore warned last week that the future of Murrin Murrin, which employs about 1500 people, was dependent on keeping a lid on labour and energy costs and access to infrastructure.
Ms Tomkinson said the CME, whose members in WA include Rio Tinto, BHP, Fortescue and Gina Rinehart’s Roy Hill, wanted to see input costs moderate.
“We need to purposefully understand what’s occurring for our economy and what’s occurring for our businesses, particularly those cost curve changes and the cost of energy changes,” she said.
“We know in the WA context that energy has gone up nearly 50 per cent in the last five years. That’s a really significant single input.
“And that’s before you look at the disruption that’s been happening globally with policy changes such as the Inflation Reduction Act in the US and the clean energy initiatives in Europe, and the work that’s occurring in Asia to encourage new processing and downstream businesses to come into the strategic industrial parks throughout Asia.”
Ms Tomkinson said the Albanese and WA governments could do more to stem job losses by making industrial land available, providing common user infrastructure and, in the case of Canberra, ending uncertainty around so-called nature-positive laws.
“We are asking for consultation and engagement as an industry to ensure that the application of the nature positive principles are able to be delivered and we can still operate our businesses,” she said.
“We are concerned at the potential for the inclusion of a climate trigger. We are concerned about the duplication at a state and federal level of approvals processes. We’re concerned that that could unintentionally slow down an already slower approvals process than industry needs.”
WA Treasurer Rita Saffioti said there was “extraordinary demand” for labour in WA.
“When there are job losses, that’s a big impact on those individuals involved. In relation to both what’s happened with [BHP] Nickel West and this Fortescue announcement, of course, you feel for the individuals involved,” she said.