AUTONOMOUS MINING TRANSFORMING THE LABOUR FORCE

by Professor Fiona Haslam McKenzie, Co-operative Research Centre for Transformation in Mining Economies (CRC TiME), University of Western Australia

Industrial automation has revolutionised mining operations around the world, increasing productivity, reducing human exposure to hazardous environments, and enabling mining companies to streamline operations. However, as this technological shift continues to unfold, it is important to examine both the benefits of the change, and the challenges that automation brings to the mining sector.

Mining in first world countries is dominated by large, well-resourced, multinational companies, with the means to extract megatonnes of resources every year, harnessing trained skilled and unskilled operators, sophisticated technologies, capital and significant METS support industries to get products to market efficiently.

For almost three decades there have been year-on-year increases in productivity in a number of Australian commodities, significantly coal and iron-ore. The quest for efficiency and supply and market domination of key commodities is what drives companies.

At the same time, companies are challenged by a global shortage of labour and declining labour productivity. In addition, lower grade ore bodies demand deeper and more dangerous operations.

There is also growing societal demand for improved and transparent environmental, social and governance (ESG) reporting. These considerations apply consistent pressure on companies to seek out technological improvements to enhance productivity and mine site safety, and minimise environmental impact.

These challenges have been powerful drivers for mining companies to harness sophisticated digital technologies to optimise their return on investment.

Industrial automation in action

In 2008, Rio Tinto pioneered a fully integrated vision to deliver a digitised ’pit-to-port’ operation, coordinating large-scale open cut operators and transport (rail) networks from a remote operation centre located in Perth more than 1,500km from its mines.

Since then, the Australian mining sector, in particular, has quickly adopted digital innovation across a range of sectors using robotics, autonomous vehicles, drones, sophisticated analytics and smart sensors, in addition to multiple city-based remote operation centres for businesses with large-scale mining operations.

The application of digital technologies has a range of advantages.

Parsed across a long mine life or a rich deposit, there are significant cost savings for the company, both in labour and ancillary onsite costs, with the redundancy of some unskilled labour, many of whom have been retrained for other roles.

The scale and timeliness of operational data transforms business processes, creating intelligent networks along the entire value chain, allowing a better understanding and utilisation of all assets (Storey, 2023).

Enhanced safety is also cited by companies as a feature of the application of digital technologies on a mine site, especially with deeper, more precarious mines. These innovations have resulted in greater productivity, enhanced labour management onsite, and financial and environmental cost savings, delivering increased overall control over mining operations (Botha 2016; McKinsey 2018).

Mining is not the only industry in Australia to be applying these technologies. The impact of the COVID-19 pandemic and the severe episodic lockdowns increased the demand and appreciation of digitalisation and automation of operational tasks across a range of industries, including agriculture and manufacturing.

Impact on people and places

Automation of mining equipment and sensors means that fewer operators are required for particular jobs.

Automation enables individual operators – usually located in the relative comfort of a city office – to manage more than one piece of equipment, several equipment types, or monitor a range of sensor units.

However, rather than making (usually relatively unskilled, mine-based) people redundant, it has been particular roles, rather than workers, that have been made obsolete from the mine site, due to the application of digitised autonomous work innovations and the introduction of remote operation centres.

Storey (2023) explains how the application of sophisticated workforce technologies, particularly remote operation centres, has created a range of different skill sets and more specialised and sophisticated education and training opportunities, particularly in cities such as Perth, where the remote operations centres are located.

Automation and the introduction of driverless trucks and trains has reduced some unskilled jobs at the mine site but, given the long-term tight labour force conditions, staff that have already been trained in mine site protocols are usually redeployed into other roles.

Consequently, given the continued growth in mining production and the demand for labour which continues unabated, the net impact of automated mine work has been negligible. This is borne out by the relatively benign response by trade unions, who initially were concerned at the potential impact of job losses on workers (rather than communities).

As documented by Storey (2023), trade unions in Australia urged State and Commonwealth Governments “to protect the workers from automation”, but to date, no direction from government or unions has been taken.

At the local level, census data (Australian Bureau of Statistics, 2022) shows there has been minimal net-impact on the workforce and population in mining communities since the introduction of automated mine sites and transport networks.

Given the need for different, sophisticated, skill sets and more specialised education and training for the more complex ‘new collar’ jobs, capital cities such as Brisbane and Perth have been the beneficiaries, just as has been the case from long-distance commuting workforce arrangements.

Cities are the direct beneficiaries through salaries and investment from the development and attraction of ‘new collar’ labour pools (Selko, 2020) to jobs located in metropolitan areas that have access to the lifestyle, amenities and services necessary to attract qualified, ‘new collar’ candidates.

Those operators whose jobs were made redundant by the application of sophisticated autonomous technologies usually remain onsite in other roles and are retrained for new jobs.

As explained by Storey (2023) “even though the equipment may be different and more may be required of workers in terms of communication and decision-making skills, … mining companies have indicated that many existing operators will be able to transition into the new roles.”1

Addressing housing demand

Housing demand across the country has exceeded supply for more than two decades in almost all mining communities across Australia, and the tight housing market was exacerbated not only by the scale of development in the mining industry but also by tightly restricted movement within and across state borders during COVID-19 lockdowns.

These restrictions forced people who would otherwise have commuted, to relocate to mining communities, or locations within state borders where they could fly-in/fly-out or drive-in/ drive-out.

Given that a large proportion of the mining labour force across Australia commute long distances either by fly-in/fly-out or drive-in/drive-out, from capital cities, the impact of digital technologies on mining towns and communities, particularly bigger regional centres such as Port Hedland, Karratha, Muswellbrook and Emerald, is not likely to be consequential.

Long distance commuting enables companies to respond quickly to the dynamism of market conditions. Moreover, some argue that the flexible cost-effective arrangements of long distance commuting and worker mobility, underwritten by companies, facilitate nimble workforce arrangements and outweigh the expensive infrastructure development costs required for residential workforces (Haslam McKenzie, 2019, Cassells et al., 2014, Morrison et al., 2012).

State governments have not hindered the utilisation of long distance commuting or the application of digital technologies on mine sites across any jurisdiction.

City vs town

The settlement pattern of Australia reflects a real paradox; many areas where considerable wealth is generated are also those areas with very sparse populations.

Mining communities such as Karratha, Port Hedland and Emerald are not the digital centres attracting new, creative, technical ‘new collar’ jobs, but their role as regional mining centres will likely continue with little change from the status quo.

Potentially it is the smaller, inland towns such as Moranbah (Queensland) and Newman (Western Australia) where impacts from contracting workforce may be noted.

However, these contractions cannot necessarily be attributed to digitisation of mining operations, but rather, are a symptom of mono-economies tied to global market conditions and/or specific mining operations whose resources eventually run out or become unsafe or uneconomic to extract.

Other bigger, mining regional centres such as Karratha, Emerald and Muswellbrook with more diverse economies and raison d’ etre are likely to weather the industry innovations and market conditions with more resilience.

The application of digital, smart, labour-saving technologies has put Australia at the forefront of sophisticated mining practices and while it hasn’t been a boon for mining towns, it has certainly advantaged mining companies and the national economy.

For a comprehensive assessment of the impacts of autonomous digital technologies on mine sites in Australia and some international settings, see Storey (2023).

Footnotes:

1. BDO (2018) suggests that while robots will replace more than 50 percent of miners, half of the miners will themselves be retrained to run the technology controlling the robots. BHP claim that over 50% of their mine control team at their Jimblebar iron ore operation in Western Australia are former heavy vehicle operators (Gleeson 2019). In contrast, Cooney and Lansbury (2018) report that less than 10 per cent of workers at BHP’s Brisbane ROC workforce had transferred there from coal basin mine sites.

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GLEESON, D. 2019. BMA's Palmer talks up potential for autonomous haul trucks. International Mining. 26.07.2019 ed. Berkhampstead.

HASLAM MCKENZIE, F. 2019. Long distance commuting: A tool to mitigate the impacts of the resources industries boom and bust cycle. Land Use Policy.

MORRISON, T., WILSON, C. & BELL, M. 2012. The role of private corporations in regional planning and development: Opportunities and challenges for the governance of housing and land use. Journal of Rural Studies, 28, 478-489.

SELKO, A. 2020. The 'new collar' workforce. Industry Week.

STOREY, K. 2023. From FIFO to LILO: From FIFO to LILO: The place effects of digitalization in the mining sector The Extractive Industries and Society, 13. (BDO, 2018, Gleeson, 2019)