Socio-economic impacts of mining industry
Standardization
The Gulp River Chamber of Commerce Submission
According to modern research, the mining industry is one of the important pillars that assist in boosting the growth of economies globally. The reason for that is because it is regarded as one of the avenues that create jobs for thousands of people wherever it is situated. Despite that, the social and economic challenges of the increasing mining activities are the ones that effect the economic well-being of the rich resource nations. The reason for that is because the mining industry and other associated activities have been realized to affect the employment rate of local employment nations. Considerable community and social infrastructure society are pressurized to observe mining as the ultimate intercontinental employment opportunity (Alanna et al., 2018). For instance, community demographics, working hours, and so on, create significant social impacts on countries with strong and efficient mining activities.
Nevertheless, it is important to identify the gaps that exist in the mining sector to enable mining developers to address its economic effects. Although mining sectors have been perceived to have the ability to bring economic benefits to the concerned nations, it has various negative economic factors. For example, mining activities have a profound impact on the health of people as well as deteriorating the natural environment. From the historical information collected, it has been realized that mining places less emphasis on the management of the welfare of the surrounding communities particularly on issues relating to environmental management, health, and safety of its workers (World Bank, 2018). Therefore, the social and economic impacts of the mining sector are what should necessitate mining developers to come up with measures that can combat these challenges. As a result of that, it is easier for them to take into consideration the effects of mining activities on the surrounding communities. In so doing, both the government and the concerned authorities can be able to formulate and implement effective policies that that can assist in promoting positive outcomes (Thomas et al., 2017). The same strategy can also have the ability to minimize the negative impacts of mining on the community.
Through mining activities, economic research indicates that it is possible for mining developers to increase the rate of employment, infrastructure development, and improvement, flow of revenue to local communities, and so on to solve communal problems. Whenever a mining site is established within a certain region, the surrounding towns get expanded to service such an activity. For instance, a large percentage of agricultural service sectors or towns encounter economic growth as a result of the services that they receive for the surrounding mining industries (Haslam, 2016). For the towns that had been previously established, gender imbalances occur in the process of establishing or building mining towns. Such a situation has the likelihood of lowering the average income for workers.
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With the increase in demand for commodities, the development of mining sectors also continues to be negatively affected. Conventional mining patterns of the traditional towns change with time because of the majority of the adoption of the FIFO strategy by mining developers. Instead of developing mining towns, companies end up establishing self-contained and permanent camps within the mining sites to provide houses for their workers. Even though the FIFO strategy could have been initially adopted by few mining sectors, a large percentage of the conventional mining sectors foster the adoption of the same strategy thus making a proportion of its workers to opt for urban works. The impact of this is that it ends up increasing the non-resident workforce of the mining sectors in urban areas (Bebbington, 2018).
Technological innovation is a necessary requirement in mining projects that need implementation. New mining projects require high standards to successfully implement the projects. However, it not easy for new mining projects to attain the technological standards that are needed to successfully implement their operations. The life cycle of mining projects begins with exploration, goes to production, and ends with closure and post-mining of the sites (Haslam, 2016). Technological innovations can accord immense benefits to mining companies and consumers at all stages of this life cycle.
Fly-in-fly-out practices draw strong concerns from critics because of these reasons. A good example of the concerns is where long-distance commuting takes place instead of immigration. Local communities do not benefit to the levels that are required in the places that new mining projects are implemented. Although the three life cycles somehow overlap, the industry must make a substantial investment in mine development especially technologically to derive optimum benefits for every stakeholder before production begins (Alanna et al., 2018). The investments will accrue in further explorations near the mineral deposits and development drilling while the mining is undergoing. In the small-host municipalities, the local employment is somehow modest as compared to the operating phase as other supporting businesses arise such as maintenance and repair firms. The suggestion, therefore, is that the employment impacts of new mining projects tend to be highly region-specific. Hence, the larger the mining site is, the more the employment prospects (Nalule, 2020). For example, the larger the expanse of the area covered by the mining project, the more the likelihood of having a higher capacity of requiring more labor skills in their expenditures.
Analysis
The Gulp River Chamber of Commerce Submission
The mining industry is a crucial component of the global economy. While the economic benefits have been thoroughly magnified and explored, social factors are now coming to light. Increasingly, the social impacts on the communities they operate in are being considered to minimize negative impacts. Research in the field is limited, but researchers are continuingly taking interest in the field. Recent studies continue to document how mining activities have a negative impact on nearby communities and town residents. The themes researchers are concentrating on include adverse effects on the imported workforce, infrastructure pressures, housing and services, inequality gaps, poor child development, family break-ups, drug and alcohol abuse, and impact on indigenous communities (Thomas et al., 2017). The themes researched are credible and valid in determining research outcomes.
The extent to which the inputs of the mining activities are implemented will determine the prevailing industrial structure. For instance, in diversified regional economies are better equipped to deal with an explosion demand for services and goods. In consideration of these uncertainties about the real-life impacts, sound assessments of employment effects are vital. Mining should be a vehicle for regional development and job creation (Filer et al., 2017). Although community relations may be intense and lead to costly conflicts, as well as increase risks for other businesses, it has to derive optimum benefits for the communities they operate.
On the other hand, the information collected indicates that the mining industry has a strong and positive impact on the non-recruitment industries. Regardless of that, research indicates that such an impact is relatively limited to service-aggregated industries. What this implies is the fact that in the long-run, technological advancement has the propensity of reducing the number of workers that are required to operative in the perceived mining industry. In this case, the time diminishing spillovers have been realized to be affecting the well-being of the local economies (Bebbington, 2018). The strategies to be implemented by communities will comprise of efforts that will enable it to achieve economic diversification.
The loss of direct employment in the mining sectors can also be dealt with through enhancing a business environment that fosters the growth of suppliers of the mining industry. Such a mechanism will enable the mining industry to develop into a mineral cluster that has the potential for internationalization (Alanna et al., 2018). Regardless of that, it should be understood that business organizations that participate in specialized intensive activities for instance environmental and technical consulting might end up facing obstacles in attracting skilled and semi-skilled labor from the remote local communities.
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The mining industry is one of the economic activities that have been perceived to have the propensity of creating jobs for thousands of people globally. In any region where such activity is being conducted, research indicates that it has continued to become one of the most important economic activities that enable people to improve their living standards. As much as they are lowly paid, they will have to cater for their daily expenses which also keep on increasing with the increase in mining activities within their region. The costs that they in for food, housing, and other services are perceived to be relatively higher in mining areas as compared to non-mining regions (Filer et al., 2017). Considering the creation of new jobs, research indicates that the attractiveness of mining activities is the one that ends up affecting the number of people who are willing to work in private and public service industries.
From the differences that exist between different mining regions, the increasing rate of employment is what has been perceived to have the propensity of affecting the economic activities of other sectors of the economy. Although private sectors are the ones that are greatly impacted, industrial sectors continue to benefit as a result of the considerations provided by the mining municipalities. The private service sectors comprise of employment in hotels, restaurants, and trade, and so on (Nalule, 2020). The information collected indicates that it is important to address the context-specific situations that affect the employment rate of the mining industry.
The inter-country differences that exist between the mining and service industry have been realized to impact the living standards of people. The result of this research also illustrates that the mining industry has the propensity of more people as compared to the service industry. With specialization in mining activities makes such industries to be able to increase the economies of scale (Thomas et al., 2017). As a result of that, it is evident that some of the differences that exist between these industries can be attributed to stronger recruitment impacts of mining.
The increase in employment rates in these sectors means that the service industry will benefit more because they have a lot of money to spend. This means that the mining boom that is experienced cannot induce the fly-in or fly-out effects because of the increasing number of people employed in mining and service industries. On the other hand, the same scenario is coupled with strategies that are used by the construction industry to attract potential investors to make huge investments (Haslam, 2016). Since mining is a tedious activity and requires a huge capital outlay, it in return increases logistic and infrastructure demands
Recommendation
Technological advancement continues to grow which in return will assist in reducing the mining spill-over effects on local communities. Traditionally, the development of the mining industry was found to have placed less emphasis on the management of the negative impacts arising from such activity. As a result of that, it is paramount for communities to ensure that they have diversified their economies through a strategy termed as mineral clusters (Bebbington, 2018). The same strategy is perceived to enable to be able to face or handle challenges they might face as a result of the establishment of mining industries within the region
Some of the issues that need to be dealt with encompass things like environmental impacts and the health and safety of the workers. since the social effects of mining have been some of the issues that have received considerable global attention, the developers of mining industries are required to take into consideration the effect such activity will have on the surrounding communities (Nalule, 2020). As a result of that, it is importat for the mining developers to come up with various strategies to decrease negative impacts as well as enhance positive outcomes.
Through mining activities, there is the creation of jobs, improvement of infrastructure, as well as the continued flow of revenues to the local communities. For instance, income inequality arising from the mining industry is one of the challenges that need to be taken into consideration by developers. Ideally, the rate of employment is associated with the decline or increase in the flow of revenues to the local communities (Filer et al., 2017). Although it is evident that workers in mining industries are paid highly, those individuals who are employed in other sectors of the economy end up receiving relatively low wages. Despite that, the social problems that are created as a result of such activity ought to be addressed appropriately to ensure that the wellbeing of the local communities does not deteriorate.
Regardless of the prevailing uncertainties in the industry, it is important for developers and the associated government to conduct sound evaluations regarding the effects such activity has on its workers. Such a scenario will have to take into account the need for applying systematic econometric approaches in assessing mining-induced work multipliers in the pragmatic context of the work being offered to the community. It is also paramount to take into consideration the data collected from the workers who are employed in the mining and the non-mining sectors so as to understand the effects of the current mining boom period.
References
Alanna, S, Tess G, Ashleigh W, & Sally B. (2018). The social impacts of mining on local communities in Australia, Rural Society. Routledge Press. 27:1, 18-34, DOI: 10.1080/10371656.2018.1443725
Bebbington, A. (2018). Governing extractive industries: Politics, histories, ideas. Oxford, United Kingdom : Oxford University Press
In Filer, C., In Le, M. P.-Y., & Australian National University Press. (2017). Large-scale mines and local-level politics: Between New Caledonia and Papua New Guinea. Canberra : ANU Press
In Haslam, M. K. F. M. (2016). Labour Force Mobility in the Australian Resources Industry: Socio-Economic and Regional Impacts. Singapore : Springer Singapore
Nalule, V. R. (2020). Mining and the law in Africa: Exploring the social and environmental impacts. Place of publication not identified: SPRINGER NATURE.
Thomas M, Thomas E, Patrik S, and Linda, W. (2017). “The local employment impacts of mining: an econometric analysis of job multipliers in northern Sweden”. Mineral Economics. 30:53–65
World Bank. (2018). Poverty and shared prosperity 2018: Piecing together the poverty puzzle. Washington, D.C : World Bank
