Canadian Mining Industry Employment and Hiring Forecasts - MiHR

Figure 2
Mining Employment and the Minerals Price Index (MPI)
220,000
210,000
Linear employment trend
during 1984 to 2002
400
350
200,000
190,000
180,000
170,000
160,000
Employment increase
corresponds to MPI gains
300
250
200
150
100
50
150,000
1984 1988 1992 1996 2000 2004 2008
Employment Canada
MPI
0
Sources: Mining Industry Human Resources Council; Statistics Canada; Bank of Canada.
Labour Productivity
Labour productivity is a complex concept that is influenced by many factors. On the whole, productivity tends to
accelerate during periods of economic expansion and slow during a recession. In terms of employment, higher levels
of productivity tend to be associated with contractions in employment needs. Declines in productivity tend to occur in a
tight labour market. One explanation for this is that as talent becomes scarce, employers may begin to hire workers who
have less experience and fewer skills, or are not quite ready to enter the workforce.
Figure 3 shows that labour productivity in the Canadian mining industry (measured as real GDP per hour worked) steadily
increased over the 1984 to 2005 period, at an average rate of 2.9 per cent 9 annually. Since 2006, however, productivity
has declined by approximately four per cent per year. A study released in September 2009 by the Centre for the Study
of Living Standards (CSLS) suggested that this decline was not necessarily related to changes in worker skills or
technology and innovation; 10 rather, it may have been a direct result of higher commodity prices, which, in turn, made
exploitation of marginal resource deposits profitable.
Diamond mining expansion in the Territories has had a positive impact on overall productivity in the sector, as shown
in Figure 4. Since the opening of the Ekati mine in the fall of 1998, labour productivity has increased at a compounded
annual growth rate of 22 per cent. During this period, the Territories’ share of mining GDP has also increased rapidly:
from 0.5 per cent in 1998 to over four per cent in 2008.
9 This is considered to be a reasonable estimate of trends in labour productivity for the sector. It is based on more than 20 years of data, covering several
business cycles.
10 Centre for the Study of Livings Standards, A Detailed Analysis of the Productivity Performance of Mining in Canada, September 2009.
2010 Employment and Hiring Forecasts
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