A SOCIAL ECONOMIC STUDY - THE WEST COAST

Our contribution to the West Coast region

We commissioned the AIGIS Group led by socio-economic scientist Dr Mark Sargent, to investigate and report on our contribution to the social and economic fabric of the West Coast of the South Island, where our Stockton export mine is located.

The study tells a story of people employed in mining on the West Coast, their involvement with families and communities, and how we contribute to the region. Mining and miners are a significant and living part of the West Coast and its people.

The lead for the study, Dr Sargent says “Employment, qualification and industry of employment data for the West Coast indicate that the composition of the regional workforce is strongly influenced by the presence of the mining industry as a key economic and employment driver.”

The workforce survey in August 2018 produced responses from 204 employees and 54 permanent contractors, an 88.9 percent response rate, who on average have worked in the industry for 13.5 years. In the following year we recruited a net 24 additional employees to work at the Stockton mine, with further information from them being incorporated into the survey results.

Other information was sourced from publicly available data (including updating in 2020 with latest available census data), and our internal financial and employment data.

Who are our miners?

  • Only 13 percent of the people surveyed have worked in mining for less than six years.
  • 36 percent have worked in mining for between six and ten years, and 33 percent have worked in mining between 11 and 20 years.
  • 12 percent have worked in the industry between 21 and 30 years.

Buller District and the West Coast Region have higher proportions of people employed as machinery operators and workers (10.1 percent and 9.6 percent, respectively) than the national average of 6.0 percent, based on 2018 Census data. This reflects the strong regional industrial base, including our mining operations.

Living in the region

Our people are committed to living on the West Coast, and are an integral part of the West Coast communities.

As at 2019, 68 percent of our workforce (employees and contractors) lived in Westport, and 93 percent in the wider Buller District.

Around one-third of the workforce has lived on the West Coast for ten years or less, and around half, for more than 20 years. The mean and median residence times are 25 and 21 years, respectively.

Around 86 percent of the workforce either fully own, or own their homes under mortgage, an investment of around $43 million, based on average regional house prices.

Contractors are more likely to rent accommodation (29.6 percent) than employees (10.3 percent). Renters contribute on average $406,000/year in rents into the regional economy.

Ours is a workforce with strong local economic and social ties. This is also reflected in how the West Coast’s population reacts to changes in mining activity.

Data from Statistics NZ, Development West Coast and Infometrics show that in 2013 the region’s population was 32,150, and in 2018, this figure dropped to 31,550. This followed the rationalisation of the former Solid Energy assets, the closure of Oceana Gold’s Globe Progress gold mine, and closure of the Holcim cement works. Conversely, future expansion of mining would be expected to see people coming into the region for work.

Family life is important to our employees, with 76.7 percent of the work force living as couples, or couples with children. Survey respondents have households totalling 734 people, an average of 2.8 per household, compared to the Buller District average of 2.3.

Active in the community

Of the 734 people in the workforce survey respondents’ households, 25.6 percent are at schools or in other education. Around 36 percent of people in these households are 24 years or younger, and 20 percent are aged 5–17, with an estimated 160 children attending local schools.

Workforce members play an important part in their communities, with 161 respondents (62 percent of the survey sample) providing 248 responses, covering 399 activities, across all categories of community involvement. They include emergency services, sports, community, schools, service, recreation and cultural organisations.

Connected into the West Coast economy

Our workforce spends on average 70 percent of their income in the regional economy, estimated at $8.6-9.4m per year, inferred from Statistics NZ data.

87 percent of other members of our employees’ households either study or work, and of the 87 percent, 48.4 percent are employed full time, and 12.5 percent part time. These working residents also spend part of their incomes in the local and regional economies.

We spent $13.5m across 102 West Coast businesses, averaged over the 2017–2019 financial years. This included $5.6m spent with 79 businesses in Buller, and $4.8m with 73 businesses in Westport. These figures compare with the $96m Bathurst spent with 397 businesses throughout New Zealand.

Based on a separate survey of West Coast extractives industries conducted in 2018, each of the above businesses likely have at least one or two other West Coast businesses among their major suppliers; i.e. an estimated 153 additional West Coast businesses benefit from economic activity consequent to our activities.

We directly inject approximately $19m per year into the West Coast economy. This breaks down to $16.3m and $12.2m per year for Buller District and Westport, respectively.

Mining and the West Coast

In 2018 mining was the third largest industry on the West Coast, delivering $107m, or 19 percent of Gross Regional Product for the region’s main economic drivers, behind tourism (34 percent), and dairying (36 percent), according to Development West Coast (“DWC”)/Infometrics data, and mining was ahead of agriculture, forestry and fishing (11 percent).

Between 2010 and 2018, DWC/Infometrics data show that labour productivity for mining was on average 2.5 times greater than that for the regional economy generally. This means mining is a relatively capital-intensive industry, with workers earning high wages.

We spent $13.5m across 102 West Coast businesses, averaged over the 2017–2019 financial years. This included $5.6m spent with 79 businesses in Buller, and $4.8m with 73 businesses in Westport. These figures compare with the $96m Bathurst spent with 397 businesses throughout New Zealand.

Taking total GDP for the West Coast of $1,517 bn as at March 2018, mining’s contribution was 7.1 percent while mining employment in the region was 2.9 percent. The equivalent figures for Buller District were 13.8 percent and 6.9 percent.

In 2018 mining on the West Coast produced $227,660 of GDP per filled job, while dairying in comparison produced $173,061, other agriculture $81,041, manufacturing (minus dairy) $68,589, and tourism $59,603.

Mining and miners are a significant and living part of the West Coast.