CANBERRA, May 25: Australia will allow mining companies to use foreign workers to help address chronic labour shortages, with mining magnate Gina Rinehart’s A$9.5 billion ($9.2 billion) Roy Hill iron ore project winning approval on Friday to bring in 1,715 workers.
Immigration Minister Chris Bowen said the government had approved Rinehart’s plan to bring in the workers to help develop the iron ore mine in the booming and remote Pilbara region of northwestern Australia.
The approval is a major shift in immigration policy and clears the way for the resources sector to use more foreign labour to help develop major projects at a time when Australian companies are struggling to find skilled workers.
‘There is no doubt that the Roy Hill Project is one of national significance,’ Bowen told the National Press Club as he announced the first Enterprise Migration Agreement with Rinehart’s company Hancock Prospecting.
Australia’s economy avoided recession following the global financial crisis, with strong labour market growth and an unemployment rate currently at 4.9 percent, well below unemployment rates in the United states and Europe.
But the resources sector, supported by continued demand from China and India, has long complained that the tight labour market and worker shortages are a constraint on expansion plans.
Rinehart, Australia’s richest woman, has long called for easier access to foreign temporary workers to help fill shortages.
In March, Japan’s Marubeni Corp, and South Korea’s steelmaker POSCO and shipbuilder STX Corp said they would buy 30 percent of the Roy Hill project for A$3.5 billion.
The Roy Hill project plans to start shipping ore in 2014, with production expected to peak at 55 million tonnes a year, which would match production rates of Australia’s no. 3 producer, Fortescue Metals Group.
Latest government figures show more than A$260 billion worth of mining and energy projects are underway in Australia, with A$450 billion of resources projects either underway or planned.
The government estimates the resources industry will need an extra 89,000 workers by 2016 to meet demand, with Australia needing a peak of 49,000 short-term construction jobs in the resources sector in 2014.
Resources Minister Martin Ferguson said the Enterprise Migration Agreements would be available to projects worth more than A$2 billion and with a peak workforce above 1,500 people.
Australia has been holding immigration roadshows for workers in the United States, India and Europe. Australia’s Mines and Metals Association says about 10 to 14 projects will be able to take advantage of the scheme.
Australia’s union movement condemned the government decision and said the new rules would allow foreign workers to take jobs at the expense of Australian workers who are losing their jobs in manufacturing industries.
‘This is just sheer lunacy, sheer lunacy, that in a week when so many jobs have been cut, to give Gina Rinehart the massive pat on the back and free Christmas present they did today,’ Australian Workers Union boss Paul Howes told reporters.
Bowen said some large resource projects would be at risk without foreign workers. The agreement with Roy Hill would cover electricians, fitters, scaffolders and boilermakers, who would be hired on the same wages and conditions as Australian workers.
He said the foreign workers would also have the same rights to workplace protection as Australian workers, and they will be made aware of their rights before starting.
($1=A$1.03)
(agencies)
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