Western Australia is seeing tentative signs of economic vigour after suffering from the end of the mining investment boom.
The state has been hit by job losses, falling property prices and a rush to the airport as those lured to the state for mining jobs headed back to the eastern states where the housing boom and infrastructure spending has been creating jobs.
However, recruitment group Harrier Human Capital says hiring has increased by about 70% compared to last year.
“That was from a very low base,” says CEO Kelly Quirk.
A year ago there were 50 to 60 new jobs a month compared to between 350 and 400 jobs there three years ago.
“Last year was pretty disastrous with very minimal hiring and very, very little permanent hiring, it was all contract work,” she says.
“What we were seeing last year was any hiring was done in healthcare, government, education, not for profit, and specifically around the age care sector.
“That’s the only thing that was propping up the economy.
“So, it seems to be turning and there’s definitely a more positive sentiment in the marketplace.”
But the rise in jobs is patchy, mainly coming from the big operators and contractors.
“So there’s certainly been a turnaround and it’s principally led by iron ore and coal and continued momentum in gold,” she says.
She says the jobs are coming back across all of resource and mining but the leader is iron ore, followed by coal, and then gold.
“It’s tilted down not just to the operators, which are the big firms like Rio and BHP =, but is now actually filtering down to the mining support services businesses,” she says.
Harrier Human Capital has also seen a 54% increase in production and refinement levels.
The jobs are in directional drilling and re-drilling services, followed by cementing services and then mine draining and pumping services.
The end of the mining investment boom saw a sharp drop in salaries and a reversal in interstate migration with many who came to WA for a jobs heading back to the eastern states.
But salaries are on their way up again in WA.
“I’d be very interesting to see the impact that the boom in the East coast fueled by government spending is going to have on WA,” she says.
“Because a lot of people have left WA to undertake projects there. There’s been a drop in salaries of about 20%, 23% over the last three years in WA.”
Peter Dyball, of Pit Crew Management Consulting Services, says the market is rebalancing, coming back to an equilibrium after several years of cost cutting.
“The early part of this decade saw the market in a frantic state, a massive demand for product meant efforts were all towards getting that product to market,” he says.
“This resulted in a huge increase in construction activity as well as operating assets being worked very hard. In many cases this resulted in organisations losing focus on the cost element of their business, having impacts right across the board which included huge increases in workforce numbers.”
However, for the past three to four years it been swinging the other way, with construction projects reaching completion and very few new resources and energy projects in the pipeline as well as most operations driving greater productivity and shedding staff.
“The resources and energy sector has been fairly brutal in their efforts to cut costs,” says Dyball. “A lot of this has come from reducing numbers and significant organisational restructuring.
“A lot of organisations having cut fairly close to the bone, are now looking at how they move forward and the roles which need to be filled, and so are making some very targeted placements within their ranks.
“In other areas maintenance and capital works were put on hold or deferred to cut costs, you can only do this for so long before it bites in terms of utilisation and production. There is a slow but steady move to undertake some of these works.
“In terms of people, the market at present is rebalancing and coming back to an equilibrium, which will hopefully be the new normal. Ideally this will be right-sized organisations which have a think smart and work smart approach.”
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