Exchange rates continue to impact mining salaries

Mine geologist: change in salaries

Employment in the mining industry is highly specialized and as a result, retaining skilled staff is challenging. These employees are often the most valuable asset at a mine and can run anywhere from 25% to 50% of the daily operating costs.

One of the top reasons that employees leave for greener pastures is how much they are paid. Individuals such as geologists, engineers and top line supervisors are in demand and can often find new opportunities fairly quickly. Mines compete for these specialized employees, often recruiting from other countries. As a result, the mining workforce is highly mobile.

According to CostMine’s 2019 mine survey results of U.S. and Canadian mines, employees at Canadian mines received a 2 to 4% salary increase for the year, while their U.S. counterparts reported an average increase of 2.7%. These statistics are derived from the results of two surveys completed last year by CostMine.

Taking a longer view, we analyzed the salaries for Canadian and U.S. mine superintendents and mine geologists over the last ten years derived from our previous surveys. The charts below show the average annual salaries for these selected titles at metal mines in Canada and the U.S., over the period from 2009 to 2019.

In 2009, the salaries were very similar for these professionals between the two countries. It is clear from the charts, that beginning in 2011, U.S. salaries for these titles lagged behind their Canadian counterparts. Our studies show that while salaries expressed in their own currencies have steadily increased over time, once the exchange rate between the two countries is factored in, the salaries for Canadian mine superintendents and geologists falls far short of their U.S. counterparts beginning in 2015. As shown below, the strengthening U.S. dollar shows the impact on Canadian salaries when expressed in U.S. dollars.

Over the ten year period from 2010 to 2019, salaries for mine superintendents have increased by 21% in the U.S., and 23% in Canada. Though, for Canadian mine superintendents, when you factor in the exchange rate their salary is 5% less than in 2010, when expressed in USD.

Salaries for mine geologists show a similar trend over the last ten years, with the exception of a slight downturn for U.S. geologists in 2019. Even with the decline in 2019, a geologist in the U.S. enjoyed a 25% increase over the last ten years, while Canadians saw a 21% increase. However, as with mine superintendents, when you factor in the exchange rate, Canadian geologists are making almost 7% less than they were in 2010 in USD equivalents.

But are Canadians in the mining industry keeping up with inflation?

According to Statistics Canada, inflation increased by 16.7% from 2010 to 2019, while mining wages increased an average of 21%.

So while Canadians may be at a disadvantage compared to their American counterparts, within Canada, wages continue to grow at a pace greater than inflation.

Krista Noyes is a cost analyst/geologist with CostMine (www.costmine.com), publisher of Mining Cost Service and part of the Glacier Resource Innovation Group, based in Spokane, Wash. She can be reached at knoyes@glacierrig.com.

CostMine conducts annual surveys of compensation practices at U.S. and Canadian mines. Complete survey reports – including actual wage and salary scales, benefit plan profiles and bonus plans for Canadian mines, and US mines can be purchased from CostMine. Details are available at www.costmine.com or by calling +1-509-328-8023.