Thanks, Pierre.
Thank you, Mr. Chair and the members of the committee. It's a pleasure to be here this morning. We certainly appreciate the opportunity to address the committee.
I'm the executive director at the Mining Industry Human Resources Council. The MiHR Council is a non-profit, membership-based organization with a mandate to identify and address the labour market and HR issues facing the mining industry today. If you are familiar with the sector council program, we are an organization that evolved from that. We are one of the few, I think, that continue to survive and thrive and continue to address the needs of our sector.
We do this collaboratively with our industry. We bring industry together, and not just employers and not just members of the Mining Association of Canada, but also organized labour, educational institutions, aboriginal groups, and a variety of other stakeholder groups to help address the needs of industry.
There has been a lot of talk recently, and also a lot of discussion through the media and other vehicles, about the skills shortage in Canada. There are very strong arguments on both sides as to whether or not Canada is in fact facing a skills shortage.
I can tell you, based on all of our consultations with our member companies—as Pierre alluded to, it's taking a bit of a reprieve today with commodity prices—that mining companies continue to face very significant challenges in attracting workers. It's not across all occupations and not across all regions of the country, but there are pockets of challenges, and there are areas of the country where there have been employment vacancies for over a year, where we just simply can't find a mining engineer with 10 or 15 years' experience to walk in to operate a mine. That's a reality.
Like I said, that's not in all areas of the country. There are a number of quotes from the chamber and the Canadian Federation of Independent Business and a number of surveys that all talk about employers talking about labour shortages, but I can tell you anecdotally, from the ground, that our employers are facing a challenge in finding individuals. I'll get into that in a bit more detail when I talk about some of the factors that drive that skills shortage and why we believe it's going to become more challenging in the years to come.
We believe that the Canadian mining labour market is facing somewhat of a perfect storm. According to the Mining Association of Canada and their members, there's about $160 billion in new potential mining projects that currently are going through the environmental assessment and permitting phase. Certainly not all of them will come to fruition, but even if a portion of them do, it will cause significant pressure for an already strained labour market.
When you factor in the aging workforce—about 40% of those in our industry today are over 50 years old, and about a third are going to be eligible to retire in the next five years—this creates a very daunting challenge. You couple an expanding industry with an aging workforce at the same time. There are a number of other recruitment challenges in regard to the fact that the mining industry is operating in more rural and remote locations; there are persistent negative stereotypes associated with careers in mining that we are still trying to dispel. When you put all that together, it makes for a very daunting challenge in trying to recruit the next generation of mine workers when you have this expansion and this aging workforce all coming together at the same time.
At the council, we look at labour market forecasting on a regular basis. We try to look at our forecasts, our demand, over the course of the next two, five, and ten years. Our most recent forecast suggests that we will need about 145,000 new people to join the industry over the course of the next decade. If you break that down, only about 20% of that number is due to growth, and that's based on our baseline scenario. So 20% of that is due to growth, but a full 80% of it is replacement requirements, replacing people who are currently working in the industry and who are leaving due to retirement or for other reasons.
This is one of the most critical challenges facing our mining industry today: where will we find the next generation of skilled mine workers? I know, from speaking to our VPs of HR and our leadership in the industry, that this is a significant problem. Where will these people come from? Well, there's no magic formula here. The mining industry does need to make better use of all potential sources of supply, including youth, women, and new Canadians, but certainly one of the key sources of labour is aboriginal people.
The mining industry has done a tremendous job in the past at doing this, and I think we're one of the leading industries in Canada in attracting and recruiting and retaining aboriginal people. Certainly, as an industry we view this as a strategic source of labour. For many reasons there's a lot of opportunity in doing that. The main one, which I think Pierre spoke to, is the fact that we operate, in many instances, on their traditional territory.
As Pierre mentioned, there are about 100 active impact and benefit agreements. These are agreements signed between mining companies and aboriginal communities. Most of those impact and benefit agreements—our socio-economic, our partnership agreements—have an employment component to them. The employment component often has targets around either a total number of aboriginal people employed or a percentage of the workforce coming from aboriginal communities.
We studied about 16 very prominent impact-benefit agreements a few years ago. We interviewed the company executives who negotiated them and the community leaders who developed them and looked at a number of challenges around why companies and communities were struggling to reach their employment targets. A number of factors came out, for example, the lack of trust and lack of knowledge about the project and careers. There were a number of barriers as to why employment targets were not met. One of the key ones was the lack of education, and in particular, essential skills and work readiness skills. Mining companies often underestimated what level of essential skills were in the community and how much of that early training was required to even get the individual employable in the sector.
As a result of that, MiHR and our industry launched a new program called mining essentials. I'd like to focus the rest of my talk on our mining essentials program and the success this program is having.
Mining essentials is a pre-employment work readiness training program geared for aboriginal people. It was developed between the mining industry and the Assembly of First Nations. It's a partnership between both the industry and the AFN, but it was developed in partnership with the Métis, with the Inuit, with essential skills experts in Canada, with a number of educational institutions. The goal of this program is really to increase the involvement and engagement of aboriginal people across the sector by providing work readiness and essential skills training needed to gain employment.
What's unique about this program is that it teaches essential skills using industry examples, industry tools, industry documents, industry scenarios, industry simulations, but it teaches all of this using an aboriginal culture. So it's not somebody lecturing in front of a classroom. It's using a culturally appropriate aboriginal approach to education, and it's using things like learning circles and storytelling and cultural events, and bringing elders into the classroom to talk about the history of aboriginal participation in mining. It's really a very holistic and different approach to education. We've seen a tremendous amount of uptake in this program, a tremendous amount of value, from the local communities and the mining companies that are hiring the individuals at the end.
We have now developed this program. It's been operating for about 18 months. We've seen uptake of this in a number of different provinces and territories across the country. We've graduated 110 graduates so far. There are 180 currently in the program. This is a 12-week program. There's a significant amount of growth with this program; it's almost exponential at this point. We anticipate an additional 200 this year. So really by the end of 2014 we could have 450 new young aboriginal people going through this program. We have about a 75% graduation rate, and 80% of those who graduate find employment immediately in the sector.
Now, that 75% graduation rate may seem low, but I can say that from an aboriginal essential skills perspective, it's actually very high. One of the key challenges with this program or requirement is attendance. That's one of the key challenges, getting these individuals in a classroom regularly for 12 weeks. That's almost like a 12-week interview that the companies can go to and see if the person is coming in on time, if they're receiving the training.
All of these intakes require an employer, partner, at the table; an educational institution, be it a community college or a private aboriginal training organization; and an aboriginal community. It's that three-stakeholder approach that has made mining essentials such a success.
The biggest challenge with mining essentials is one of funding. My last point on this is the program has been extremely successful and has been rolled out across the country in both English and French with a number of communities, not just first nations, but with Métis and Inuit communities as well. The biggest challenge is trying to find the funding to run the program. I can tell you that the federal government, through the SPF and the ASETS program, has been instrumental. There's a number of funding pots available for this funding as well through the provincial and territorial governments that have been quite successful. Mining companies and industry associations have also stepped up and helped fund these programs, but the key challenge is trying to get aboriginal communities access to this funding and steer that funding into programs like mining essentials that have a meaningful return on that investment and lead directly to employment in any industry, but in our case, mining.
I'll leave it at that. Thank you very much, Mr. Chair.