According to the World Bank, the global talent pool has grown in recent years, but many countries and industries are struggling with talent scarcity. The case for Mexican mining is about whether millennials aim to dig into mining or not. “Young talent usually chooses to work in industries that seem more appealing,” says Jose Raul Guerrero, President Mexico, Central America and the Caribbean of Korn Ferry. “The reality is that new generations usually do not consider mining.”
The challenge becomes one of making mining more attractive to the youth. Easier said than done. To tackle this issue Guerrero believes that communication about the industry’s perks is key. The idea is to make new generations see the value that the mining industry can deliver to both their careers and the world.
One day to go before AMLO’s inauguration of AMLO as President of Mexico, his priorities for the mining industry is still unclear. However, the industry does know that mining will be a focal point for Morena’s administration. Graciela Márquez, incoming Minister of Economy announced a support program to mining communities as one of the Ministry’s top projects.
How will this be achieved? For starters, the Mining Trust Fund, previously under the jurisdiction of SEDATU, is expected to operate under the Ministry of Economy to unify mining matters in one government agency. The fund was created to redistribute mining wealth through the allocation of 80 percent of mining taxes to local communities for the development of infrastructure and local economies. Márquez’s ambition is to get 100 percent of these taxes to the people impacted by mine operations.
But besides the path to be taken by the soon-to-be the Mexican administration, the importance of mining as a key economic pillar for the country is unquestionable. While the aggregate figures for FY18 have not yet been published, in 2017 mining contributed with 2.5 percent of the country’s GDP. It is also useful to consider the industry’s significant economic contribution to the top mining states.
|Percentage of mining contribution to State GDP in 2016||10.68||17.8||6.3||4.94||3.65|
What’s more, the 14th edition of the Survey to the Mining Sector, a study carried by Korn Ferry and CAMIMEX, finds that the industry’s investment in Mexico was US$4.3 billion in 2017, a 14.7 percent increase from 2016. The study, which surveyed 43 mines and 29 business groups, reveals that employment in the sector grew 4.8 percent in 2017 and that the companies listed on the BMV reported a 44.8 percent EBITDA the same year, the highest in five years.
HUMAN RESOURCES OUTLOOK: IT’S ABOUT WAGES
As found by Korn Ferry, employment in mining is on the rise, proved by a 4.8 percent increase in 2017. But besides a hiring boom, the industry is also appealing to workers given its compensation and benefits plans. The 14th edition of the Survey to the Mining Sector gathered data from over 7,150 job positions across the Mexican mining industry to better understand wage structures in the sector. The conclusion was that mining has higher salary increases than the average job market in Mexico.
To analyze the wage scenario in the country it is useful to take a closer look at the situation of the main mining state in the country: Sonora. According to ProMéxico, the industry contributed MX$70.11 billion to Sonora’s GDP in 2016. The average salary paid by the industry was MX$543.8 per day compared to the state estimated average salary of MX$288.1 and the national average of MX$333.2. Similar margins remained in the other states.
As for gender diversity, the industry has a 17 percent participation of women. When comparing salaries, Korn Ferry found that compensation plans and responsibility assignments between both genders were aligned.
WHY THE YOUTH?
While millennials have been described as a volatile generation, they are also known to be extremely creative. Such creativity is certainly useful in rethinking mining processes to make them more profitable. For Carlos Silva, CEO of Carrizal Mining and of Santa Cruz Silver Mining, they key to attracting millennials is to understand them. “Seventy-five percent of Carrizal Mining’s staff is millennial, a generation often perceived as unpredictable, yet our turnover is very low,” he says. “The secret is to listen to what employees want.”
Silva advises to challenge, empower and give the youth growth opportunities. “My strategy is to develop my employees. For us, this means keeping our people with us and having a low turnover rate,” he says. For example, mining companies can share expenses for education and training programs. This way, companies could attract and keep employees longer, while having more specialized people; a win-win for the human capital and for the industry.
Want a chance to speak to government representatives about the future of the mining industry? Don’t miss out on your chance to rub shoulders with the industry’s leaders at the launch of the new edition, Mexico Mining Forum 2019, at the Sheraton Maria Isabel hotel in Mexico City this February 6! Register here!