The phase-out of the coal sector in the Hunter Valley will happen. The only real question is when?
Will we be ready?
When Ansett went bust in 2001, over 10,000 workers were out the door in a flash. Follow-up studies show these workers suffered enormous financial grief. Re-entering the labour market was difficult for many.
In contrast, when the Newcastle steelworks closed in 1999, the Pathways initiative gave employees the chance to prepare for work after steel. Even then, many contractors slipped through the compensation and retraining net, while older workers drifted onto disability support programs as local blue-collar jobs evaporated.
Most shut downs aren't so orderly. In 2012, for instance, Kurri Kurri smelter workers lost their jobs without warning. Compensation and retraining packages never appeared. Is this what the Hunter's coal miners can expect: locked gates, no retraining, no alternative economic strategies, no environmental clean-ups, offshore employers devoid of assets?
A second observation is that many mining workers - quite a lot, in fact - don't have transferrable skills.
The census tells us there were 11,600 workers in the Hunter mining sector in 2016. These are real workers with working years ahead of them, families to support, mortgages and superannuation to pay. Census detail gives us a handy insight into who will be affected by the shutdown of the coal sector.
A few observations can be gleaned. The first is that Hunter coal workers are a reasonably youthful bunch, at least compared to the ageing profiles of workers typically found in declining industrial sectors. Almost half (48 per cent) of Hunter coal workers are under 40 years of age.
When coal exits, these workers will need substantial career planning, and probably re-training. Many will need to sell their homes, uproot family, including a working spouse, to start life afresh somewhere else. Most likely, this will be in a coastal city. Housing costs will be a big issue. Social and cultural adjustments won't come easy.
For the Hunter's older coal workers (24 per cent are over 50 years), migrating to another labour market is less likely, and local job options will be severely limited. Wages will inevitably be lower, by a lot. Resorting to unemployment benefits or disability support will be economically and personally devastating.
A second observation is that many mining workers - quite a lot, in fact - don't have transferrable skills. The background training levels of miners are poor, including among younger miners. Of those under 40 years of age 26 per cent hold nothing beyond a HSC or certificate II qualification, while only 13 per cent of under 40 year olds hold a bachelor degree. Finding a job outside coal that pays $125,000 annually - the sector's average salary in 2019 - without a university degree or genuine trades qualification is unlikely, anywhere in Australia.
A third observation is that mining workers are an unusual mix of local resident workers and drive-in drive-out workers. A study last year by Dr Neil Perry, a colleague at Western Sydney University, revealed that mining represents 31 per cent of all jobs in Muswellbrook and 41 per cent of jobs in Singleton. The shutdown of the coal sector will decimate these townships, with profound negative multiplier impacts on local businesses, and on employment in population-related sectors like education, health, personal care, retailing, accommodation, cafes and so on.
The experience of jobs loss for the drive-in, drive-out workers will be different, but not insignificant. Convoys of workers travel to upper Hunter mines from the lower Hunter, many bunking in rudimentary digs. Where will this group find work? The Newcastle economy isn't crying out for more labourers and truck drivers. Yet, as long distance commuters, these workers obviously place high value on living in the lower Hunter, with links that would be difficult to sever in order to move to a distant new job.
There is much to prepare for. Beyond the mines are mining's support sectors: trucking, rail freight, coal loading at the port, electrical and engineering services and so on and so on. Infrastructure and its operators can't simply run down the M1 and start up again in Sydney. Then there is the restoration task for agriculture, the horse industry, viticulture and tourism, all sectors that have been pushed aside as governments have privileged mine investment in the upper Hunter over the past four decades.
Yikes, what a task lies ahead.