Trades Demand to Remain Strong

Labour Market Forecast Projects 2,312 Job Openings by 2030

By John Curran

Through the GNWT’s Skills 4 Success initiative, the Department of Education, Culture and Employment recently teamed up with the Conference Board of Canada to produce a comprehensive Labour Market Forecast and Needs Assessment.

The results of that project show that demand for skilled trades workers will remain high until at least 2030 while at the same time enrolment in trades training has been trending lower.

The report states that in terms of jobs in the skilled trades or requiring occupational certification, there are projected to be 2,312 openings between 2015 and 2030. Overall that represents more than eight per cent of the total job opportunities forecast in the extensive study’s base case projection.

Finding people to fill those jobs will take time as skilled trades and certified occupations typically require a combination of formal postsecondary education at a technical training institution as well as on-the-job training as an apprentice. While the amount of time needed for education and apprenticeship varies, on average it takes three to four years with roughly of eight weeks of postsecondary education required each year to become certified.

Modeling the Economy

To understand how many openings there will be in each job category, researchers first had to model the NWT economy and all expected changes over the 15-year period they were studying. The results of that work have been expressed in a base case although they also left room for more optimism in medium and high case estimates that primarily hinge on increased global demand for Northern commodities. The base case is likely the most accurate depiction of the future to consider for planning purposes since it doesn’t rely on as many forces outside of territorial control. 

While it is still based on a series of assumptions, all of these have been deemed likely to hold over the 15-year forecast period as of August 2015 when the bulk of the research was wrapping up. Individual events like the Snap Lake and Cantung mine closures challenge these predictions. However, the report’s authors state the base case model flagged general weakness in mining in 2015, and weighed that against the activities of the mining sector as a whole.

“In that sense, the base case model and its assumptions do generally hold for the NWT economy,” they wrote.

In this projection, the report closely examines the state and future of the territories’ diamond mining industry which is a huge driver of the total economy.

Diavik, which is owned by Rio Tinto and Dominion Diamond Corporation, is the largest mine in the three territories, and also one of the largest in Canada in terms of economic output. In 2014, the development of the A21 pipe, which is estimated to contain about 10 million carats, was approved and will extend the life of the mine. The base case forecast calls for production to begin in 2018, which will extend the life of the mine until 2023. Yet production is still expected to drop to 6.8 million carats this year and slowly decline over the rest of this decade.

The Ekati mine is majority owned by Dominion Diamond Corporation. Operations have gone well in the past few years, benefiting from higher-than-expected grades and improvements made to the processing plant. In the medium term, output will be boosted by the Misery and Pigeon deposits, which are next scheduled for development. Further ahead, Ekati production will be bolstered by the development of the Jay pipe, which is the mine’s largest undeveloped deposit. The forecast assumes that construction on the Jay pipe will start late in 2017, with production beginning in 2020. Under the current mining plan, which is used in the base case scenario, the Ekati mine is expected to finish operations in 2030.

The smallest of the NWT diamond mines, De Beer’s Snap Lake, is now closed. The immediate impact on employment will be a loss of 258 resident jobs, with an indirect and induced impact of an additional 253 jobs in other sectors of the territory. While the 258 jobs lost is permanent, the 253 (indirect and induced) jobs are a short-term, worst-case scenario. Researchers feel that over time, the impact of these will be reduced as some residents find other employment in different sectors.

The Gahcho Kué mine, which is owned by De Beers Canada and Mountain Province Diamonds, began operations in 2016 after a three-year construction phase. The addition of Gahcho Kué is expected to raise diamond production above pre-recession peak levels of 2007 by the year 2019.

Activity Beyond Diamonds

The economic model points to metal mining as another area of expected resurgence with several mines expected to advance in the coming years including Canadian Zinc’s Prairie Creek project and potentially Fortune Minerals’ NICO project. Ground transportation links for both are currently the subject of ongoing Environmental Assessments by the Mackenzie Valley Environmental Impact Review Board.  

Since peaking in 2001, the NWT’s Oil and Gas industry has been on a downward trajectory. The development of resources in the Canol shale play and the Beaufort Sea are in the very early stages. While this forecast does not include any new mineral fuels production from these plays, they do represent an upside risk to the forecast should substantial exploration activity resume and things progress faster than expected.

“In this mainly pessimistic context for oil and gas production, there is pressure on the mining sector to help pick up the slack,” states the report. “From 2015 to 2022, diamond and metal ore production from new mines are expected to boost the mining industry to an average annual compound growth rate of 13.2 per cent. However, from 2022 to 2025, mining output will contract at an average compound rate of 12.4 per cent per year, as mining at Diavik comes to a close.”

As such the GNWT itself will continue to be an important contributor to economic activity and employment in the territory. The report highlights the introduction of resource royalties as a means for the government to finance needed programs and infrastructure projects, such as several potential highways. While researchers admit growth will be muted by lower oil and diamond production over the longer term, they remain confident economic conditions should be relatively healthy.

Understanding what the economy and labour market will look like are key to the Skills 4 Success initiative as that will allow that government to better know where and when to provide additional resources and assistance. Closing the education and employment gaps to ensure NWT residents have the skills, knowledge and attitudes to achieve employment success are the critical goals of Skills 4 Success.

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