DFP Mining and Resources Job Index FEBRUARY 2018 Detailed Market Analysis for the Mining and Resources Sector in Australia 1300 337 000 dfp.com.au
Introduction Welcome to the latest edition of the DFP Mining and Resources Job Index which provides month end data for February 2018. Improvement continued in the Mining and Resources sector with the DFP Mining and Resources Job Index rising in February by 0.9%. 2018 had a positive start with job opportunities up 5.8% for the quarter. In an encouraging sign, Permanent vacancies continue to lead the way with another increase, while Temporary and Contract vacancies were slightly down this month but only by 0.1%. Despite a small dip in results for the month by 0.7% for Western Australia, its results are strong over the past 6 months. Queensland continued its solid start to 2018 with another increase in February by 3.4% to follow the 4.3% increase in January. In the specific sectors, Coal and Mineral Mining continues its upward trend, while the Oil & Gas sector continues to lag the rest of the industry. Our aim is to deliver research that is timely and informative to employers, job seekers and those with an interest in the Australian Mining and Resources job market. Local experts in the resources industry backed by a strong national brand. Focussing on contract and permanent positions, DFP Resources works in partnership with clients and candidates across a variety of Resources segments. We recruit across the following resources segments: Exploration Mining - Surface & Underground Maintenance & Engineering Health, Safety and Environment Site Administration Learning & Development Oil and Gas Shutdowns Logistics and Transport Trades Projects DFP Mining and Resources Job Index - February 2018 1300 337 000 dfp.com.au 2
National Job Index Chart 1: National Index and Job Type Analysis 120 100 80 60 40 20 Nov-13 Mar-14 Jul-14 Nov-14 Mar-15 Jul-15 Nov-15 Mar-16 Jul-16 Nov-16 Mar-17 Jul-17 Permanent Temporary/Contract National Nov-17 Feb-18 February saw a further improvement in job prospects in the mining and resources sector with the DFP Mining and Resources Job Index in positive territory again. The Index rose 0.9% from 85.35 to 86.10. While the scale of the rise is unremarkable, what is most encouraging is that it marks a new high in job opportunities. This is the highest level since April 2014. It also marks the eighth successive monthly rise. Once more it is permanent job vacancies that are driving this growth. Another 1.5% increase this month takes the quarterly rise to 11.1% over the traditionally quiet season. Twelve months growth stands at a very impressive 37.4%. 60.1% Permanent 39.9% Temporary & Contract Percentage of vacancies advertised in February 2018 The Temporary and Contract market eased, by just 0.1%. It leaves contingent job opportunities 1.4% lower over 3 months but still a healthy 20.9% higher than a year ago. The relative strength of the Permanent index now leaves it on 87.60, higher than the 83.95 level for the Temporary and Contract index. This started in January and may well become a feature should the market, as we anticipate, continue to improve in 2018. DFP Mining and Resources Job Index - February 2018 1300 337 000 dfp.com.au 3
National Job Index Chart 2: Comparison between the National Index and the RBA Commodity Price Index 120 100 80 60 40 RBA Bulk Commodity Price Index DFP Mining and Resources Job Index 20 Nov-13 Mar-14 Jul-14 Nov-14 Mar-15 Jul-15 Nov-15 Mar-16 Jul-16 Nov-16 Mar-17 Jul-17 Nov-17 Feb-18 The RBA s Non Rural Bulk Commodity Price Index continues its sharp recovery. It rose another 5.7% in February taking aggregated commodity prices close to their last high set in late 2016. These high prices offer substantial profit margins for large low cost producers. Production levels are rising and this is having a positive impact on the mining and resource job market. The gap in the respective index suggests scope for further improvement in employment opportunities. DFP Mining and Resources Job Index - February 2018 1300 337 000 dfp.com.au 4
State Analysis Chart 3: Comparison of State Job Indices - February index WA QLD Other -0.7% 3.4% 0.9% 86.63 75.60 100.90 After 5 months of continuous growth demand in Western Australia eased, but by only 0.7%. It has been an encouraging Bull Run 15.8% growth in 6 months, but December and January s stunning growth was always going to be hard to maintain. The relative size of this month s decline against prior monthly rises suggests this may be a temporary aberration and growth likely to resume in the months ahead. 46% 2.5% 4.6% 28.7% 12.2% 5.1% 0.2% Queensland also looks in good shape. It sustained a modest fall in December but this has been followed by encouraging growth in the first 2 months of 2018. Net growth for the quarter is 6.2% but even more impressively, annual growth now stands at 44%, which is excellent news for job seekers. Chart 4 provides a breakdown of the proportions of each state and territory. Queensland s phenomenal 12 months has seen its share of national job opportunities rise from 26% to 28.7%. As expected, WA continues to have the greatest marketshare which currently stands at 46%. 0.7% Chart 4: Analysis of Job Advertisements by State and Territory DFP Mining and Resources Job Index - February 2018 1300 337 000 dfp.com.au 5
Sub Sector Analysis Chart 5: Analysis of Job Vacancies by Sub Sector - February index Chart 6: The Proportion of Job Vacancies by Sub Sector - February index 110.66 Coal & Mineral Mining 16.6% Mining Services 5.9% Coal & Mineral Mining 60.61 107.01 114.12 82.49 Oil & Gas Extraction Metal Ore Mining Exploration Mining Services 6% Exploration 45.4% Metal Ore Mining 26% Oil & Gas Extraction Job opportunities in the Coal and Mineral Mining continue to grow at an exponential rate, rising 10.3% in February. The index is now at a record high of 110.66. Annualised growth of 43.8% disguises a relatively weak market in early 2017, followed by the last 6 months of successive improvement. The main driver for this is the price of Thermal Coal, up 27.5% (12 months to January 2018). Exploration has also had a remarkably strong run of growth. It rose by 7.4% in February. The index is also at a record level (114.21) but we saw an equally strong second quarter of 2017 fade rapidly. Again, high prices are going to make marginal projects commercially viable, however the volume of opportunities here are low and therefore volatile. The Oil and Gas index certainly lags the rest of the market. The index slipped in February by 0.9% to just 60.61 but OPEC s production cuts and the consequent rise in prices has helped employment prospects in Australia, up 33% in the last 6 months. Job opportunities with metal ore producers have been steady. It also slipped 0.9% in February but net growth of 4.5% in the last quarter and 19.6% is well below the national average. The index figure of 107.01 is not far short of record levels over 4 years. Likewise, iron ore prices have been trending upwards since last September stimulating demand in Australia. Despite the rapid improvement in job vacancies in the Coal Mining sector in the last year and in Exploration in the last 3 months, both still represent a small proportion, 6% each, of the national market. DFP Mining and Resources Job Index - February 2018 1300 337 000 dfp.com.au 6
High Level Occupational Analysis Chart 7: Analysis of Job Advertisements by Occupational Group - February index Operational Management Engineering Professionals Trades and Operators Business Support Jan 2018 (1 month ago) 65.63 86.76 99.27 88.59 Aug 2017 (6 months ago) 2.4% -2.3% 0.8% 4.8% 67.19 84.80 100.01 92.88 59.99 72.53 87.53 74.76 Feb 2017 (12 months ago) 56.10 62.91 80.64 60.70 Rising production levels are starting to push the Operational Management market to improved levels. It enjoyed a stronger than average monthly growth in February of 2.4%, and likewise, quarterly growth of 12.4% is well above the broader industry norm. The Operational Management group is still well below all other major occupations at 67.19. This is its highest level since November 2014. Engineering Professional job opportunities had also lagged the market but enjoyed considerable improvement throughout 2017. February saw a 2.3% retreat from January s high of 86.76. This is more likely to be a temporary stalling rather than anything more profound and concerning. Trades and Operators continue to be treading water. A 0.8% rise in February only nullifies falls in December and January leaving demand just 0.4% lower over the quarter. Prospects in this area still remain positive. DFP Mining and Resources Job Index - February 2018 1300 337 000 dfp.com.au 7
Operational Management Chart 8: Analysis of Job Vacancies across Operational Management Occupations - February index 75.03 Geologists & Other Sciences 10.3% 3.8% 59.98 Production & Project Management Jan 2018 (1 month ago) 68.01 51.81 55.01 87.80 57.08 Occupational Health & Welfare 3.8% -4.6% 83.75 Technical Services & Maintenance Management Aug 2017 (6 months ago) 46.83 60.09 46.41 80.76 Feb 2017 (12 months ago) 70.35 45.93 48.57 71.52 Operational Management was, once again, buoyed by strong growth in demand for Geologists and Geo Scientists. In February we recorded a further 10.3% increase. This growth and the decline preceding it, correlates well with the increase in hiring by exploration companies. Ironically, demand has been so volatile that it is now just 6.6% higher than last February. The level of demand is now higher than it has been for over 3 years. Demand for Technical Services and Maintenance Management has been subdued in the early months of 2018 with demand falling by 4.6% in February. DFP Mining and Resources Job Index - February 2018 1300 337 000 dfp.com.au 8
Engineering Professionals Chart 9: Analysis of Job Vacancies across Engineering Occupations - February index 79.91 Mechanical & Production Engineers 72.22 - Jan 2018 (1 month ago) 83.21 - Aug 2017 (6 months ago) 58.04 - Feb 2017 (12 months ago) 10.6% 6.7% 46.33 Mining & Petroleum Engineers 48.95 - Jan 2018 (1 month ago) 33.54 - Aug 2017 (6 months ago) 41.77 - Feb 2017 (12 months ago) -5.4% -6% 61.46 Other Engineers 57.59 - Jan 2018 (1 month ago) 61.42 - Aug 2017 (6 months ago) 56.77 - Feb 2017 (12 months ago) 111.47 Engineering Trades & Technicians 118.55 - Jan 2018 (1 month ago) 89.18 - Aug 2017 (6 months ago) 74.30 - Feb 2017 (12 months ago) February saw mixed results amongst Engineering Professionals. On one hand, demand for Mechanical and Production Engineers rose 10.6% and Other Engineers by 6.7%, while demand for Engineering Trades and Technicians fell 6% and Mining and Production Engineers by 5.4%. This result is very disappointing for those seeking work as mining and petroleum engineers where demand remains very poor. Opportunities did pick up in the last quarter of 2017 with the index reaching 50 for the first time in 3 years only to see it slip back in the first 2 months of 2018. Engineering Trades and Technicians remain the strongest engineering category. While below the high point of 118.55 set in January, annual growth of 50% leaves opportunities well ahead of all other engineering professionals. DFP Mining and Resources Job Index - February 2018 1300 337 000 dfp.com.au 9
Trades and Operators Chart 10: Analysis of Job Vacancies across Mining and Resources Trades and Operators - February index 127.49 Riggers and Labourers 3.4% 75.32 Construction, Electrical and Mechanical Trades -7% 96.15 Drillers, Miners and Moving Plant Operators 3.2% Drillers, Miners and Moving Plant Operators have seen the improvement in their job prospects in the second half of 2017 continue into the New Year. In February demand rose by 3.2%, its eighth monthly rise. The index is now on 96.15 closing in on the levels of demand last seen in early 2014. Riggers and Labourers should feel equally confident. Demand also rose by 3.2% in February but the Christmas / New Year period was not nearly as bullish. Demand is down 3.8% over the quarter but this is offset by the 36.6% growth achieved in 12 months and an index looking to hit new heights in the months ahead. 123.34 Jan 2018 (1 month ago) 80.96 Jan 2018 (1 month ago) 93.16 Jan 2018 (1 month ago) 116.30 Aug 2017 (6 months ago) 75.78 Aug 2017 (6 months ago) 71.98 Aug 2017 (6 months ago) 93.35 Feb 2017 (12 months ago) 73.17 Feb 2017 (12 months ago) 75.62 Feb 2017 (12 months ago) Data supplied under Copyright by HRO2 Research Pty Ltd DFP Mining and Resources Job Index - February 2018 1300 337 000 dfp.com.au 10