With the mining industry's fortunes improving, now is a good time to revisit the mistakes of the last boom.
The downturn in the mining, resources, oil and gas sectors impacted individuals from all walks of life, from café owners in mining communities to the corporate end of town. You may even be one of them. Nowadays, articles are appearing stating the worst of the downturn is over: new operations are planned and mines previously in “care and maintenance” are scheduled to reopen.
Mining is coming back. So, it may be timely to ask:
What lessons were learnt from the last 10 years?
In years gone by when commodity prices slumped, the impact was felt mostly in the mining towns. With mining having a predominantly FIFO workforce, this downturn affected entire states, particularly WA, NT and Queensland.
Mining is an attractive industry for many based solely on the perceived incomes offered for entry-level people. The industry needs to be transparent with the requisites to earn high salaries. $100,000 is not on offer to a person wanting to work FIFO from Sydney. The more people in the industry can “tell it like it is”, the higher the probability of attracting individuals who want to be in mining, rather than those whose sole focus is a six-figure salary.
During the boom, job vacancies were abundant and skilled people in short supply. There were times people changed roles for ludicrous reasons. We’ve all heard stories of employees leaving for more money, better facilities or the notion “it’ll be better there”. Most of the time, they didn’t use the facilities or “it wasn’t any better at all”. Consider your personal reasons for wanting a change of role and ensure it ties in with your career plan.
A few people made a small fortune through investment, timing or good luck. Others lost everything.
This article quotes findings from a recent report from Mission Australia showing 30 per cent of people are six paydays from homelessness. The reality for this 30 per cent: lose your job in August and you’re on the street before summer starts. Jobs, mines and high salaries are not forever. The same article provides relevant tips on financial resilience.
Where to from here?
As we enter a period of cautious optimism, it’s worth reflecting on the above. Not everyone in Australia benefited. And the next downturn is as certain as death and taxes.
During the boom, Australia needed more forward thinking from Canberra. We’ve needed budget surpluses to be generated instead of our current post-boom record national and state debt. Perhaps Australia one day could follow the example of the Norway Sovereign Wealth Fund?
Hopefully, companies and governments all have the ability for reflection, critique their actions and plans and learn from past mistakes. At an individual level, it’s up to each of us to do the same, and manage our own plans, goals and careers responsibly.