Mining is an important economic activity in many developed and developing countries. The formal mining sector employs more than 3.7 million workers. In addition, more than 20 million people work in artisanal and small-scale mining (ASM).
Despite its importance, there is a misperception that mining is not a significant contributor to global employment. People often reach this conclusion by considering only direct employment or by comparing mining to other sectors. However, such a narrow view fails to consider the many jobs created in the support industries that provide goods and services to the mining sector.
The Geneva-based International Labour Organization reported that in 2010 there were 1.5 million people employed in the mining sector in developed nations, and 2.2 million in developing/emerging nations. The number of people working in mining jobs dropped significantly during the 2008 recession, although many of these jobs have since returned. In addition, artisanal and small-scale mining employs an estimated 25 million people worldwide, and indirectly supports more than 150 million people.
Mining takes place in more than 100 countries, with more than 50 regarded by the World Bank as "mining countries" because of the importance of mining to their exports, domestic markets, or to employment.
The formal mining industry not only creates mining jobs but also generates employment indirectly by stimulating demand for goods and services. Mines spend millions of dollars on equipment, maintenance, food and other services and often use local contractors and suppliers. This creates jobs indirectly in processing and manufacturing mined goods, transportation, and providing equipment and services to the mining industry.
All industries will create these types of spillover effects, known as multipliers, but the mining sector generally creates a higher multiplier effect than other sectors. The multiplier effect can be significant but varies depending on the amount and type of outsourcing done.
Generally the amount of indirect employment generated by a mine exceeds its direct employment. For example, case studies found that for every job directly created by the Yanacocha mine in Peru, 14 jobs were indirectly created. In addition, the number of indirect jobs increases over time and can stimulate local entrepreneurship and new business development. 
Canadian-owned mining firms are active internationally, with nearly 1,000 exploration companies in more than 100 countries and more than 4,300 mineral projects at various stages of development. Canadian mining companies employed more than 169,000i workers in Canada and abroad in 2011.
Mining also remains an important source of employment in Canada. In 2010, one out of every 50 Canadian workers was directly employed in mining, resulting in 308,000 jobs. In 2009, this sector accounted for 2.1% of Canada’s total employment yet contributed 2.7% ($31.9 billion) of Canada’s total GDP, down from 3.2% ($39.8 billion) in 2008.
Mining also generates significant indirect employment in Canada in both rural and urban areas. Statistics Canada does not break down employment data in mining-related supporting activities (e.g. exploration, contract drilling, and transportation). However, the Mining Association of Canada reports that 3,223 companies supply goods and services to mining companies such as accounting, environmental consulting, legal and technical advice, and finance. They also note that the Canadian mining industry also supports many jobs in shipping, rail and transportation. A 2011 analysis of the economic impacts of mining in British Columbia found that 21,112 people were employed directly in mining (2% of BC’s labor force), with an additional 16,590 jobs indirectly created.
i Calculated using the Globe and Mail, “2011 Rankings of Canada’s Top 1000 Public Companies by Profit, total employees in industry categories ‘Metal Mines’, Non-Base Metal Mining’, ‘Other Mines’, and ‘Precious Metals.’
1Hentschel, T., et al., Global Report on Artisanal & Small-Scale Mining, 2002, Minerals, Mining and Sustainable Development [MMSD]. 2Zeballos, E.J. and S. Garry, An Overview of Employment Trends and Working Conditions by Economic Activity in Jobs Recovery: Sectoral Coverage 2010, Sectoral Activities Department, International Labour Organization (ILO). 3Hruschka, F. and C. Echavarria, Rock-Solid Chances: For Responsible Artisanal Mining, in Series on Responisble ASM, No. 3 2011, Alliance for Responsible Mining [ARM]. 4World Bank and International Finance Corporation, Treasure or Trouble? Mining in Developing Countries, 2002, International Finance Corporation. 5Investment Climate Advisory Service (IC), Sectoral Licensing Studies: Mining Studies, 2009, World Bank Group. 6International Council on Mining & Metals, UNCTAD, and World Bank, Synthesis of Four Country Case Studies, in The Challenge of Mineral Wealth:Using resource endowments to foster sustainable development 2006, International Council on Mining & Metals [ICCM]. 7World Bank and International Finance Corporation, Large Mines and Local Communities: Forging Partnerships, Building Sustainability, 2002, International Finance Corporation. 8The Mining Association of Canada, A Report on the State of the Canadian Mining Industry: Facts + Figures 2010, 2010. 9The Globe and Mail, 2011 Rankings of Canada's top 1000 public companies by profit, 2011. 10Canada, Natural Resources Canada [NRC], Employment Information Bulletin, July 2011, 2011. 11Canada, Natural Resources Canada [NRC], Canadian Minerals Yearbook (CMY) - 2009, 2009. 12PricwaterhouseCoopers, Economic Impact Analysis, 2011, Mining Association of British Columbia.
Mining has the potential to shape and affect economies directly and indirectly. Mining brings employment, government revenues, and opportunities for economic growth and diversification. However, market fluctuations, economic and public institutions, and resource revenues can present challenges in converting natural resource wealth into sustainable economic growth and development.
This page will explore how mining affects the economy and answer common questions.
Employment Information Bulletin
Canada, Natural Resources Canada [NRC] (2011). Employment Information Bulletin, July 2011.
A Report on the State of the Canadian Mining Industry: Facts + Figures 2010
The Mining Association of Canada (2010). A Report on the State of the Canadian Mining Industry: Facts + Figures 2010.
Large Mines and Local Communities: Forging Partnerships, Building Sustainability. World Bank Group's Mining Department, International Finance Corporation
World Bank and International Finance Corporation (2002). Large Mines and Local Communities: Forging Partnerships, Building Sustainability. World Bank Group's Mining Department, International Finance Corporation.
©2012 Fraser Institute. All rights reserved.www.fraserinstitute.org