Profits up, jobs down: the resources sector paradox
Site wind downs and job cuts dominated headlines in 2025.
In November, BHP Mitsubishi Alliance (BMA) placed its Saraji South coal mine, which employed more than 750 workers, into care and maintenance. In a second culling, the company announced it would also be winding down operations at its Yandi iron ore mine in the Pilbara — putting another 850 jobs on the line.
Anglo American also cut more than 200 jobs across its coal operations in Queensland and more than 450 jobs were lost when Mount Gibson Iron (ASX: MGX) closed its Koolan Island mine in WA.
These are just a handful of the confirmed redundancies reported in 2025.
Yet, the resources sector has continued to cash in with market capitalisation increasing 15% from last year, according to PwC’s Aussie Mine Report 2025.
Australian Resources and Energy Employer Association (AREEA) reports that, as of May 2025, the Australian resources and energy sector directly employed 317,400 people — a rebound of 10.4% since employment numbers dropped to 287,600 in 2024.
Even backed by a strong pipeline of 96 projects valued at $129.5b that are forecast to generate demand for 22,279 new operating-phase jobs, the 2025 annual resources and energy workforce forecast from AREEA reported the weakest five-year outlook in more than half a decade.
Despite a strong project pipeline, employment projections remain highly sensitive to global market shifts, political dynamics and regulatory settings. Increased sustainability efforts, shifting policy settings, extended approval timelines and rising geopolitical tensions are all shaping an uncertain future for industry.
Amid the mixed signals, the question remains — what’s really happening to Australian mining jobs?
Industry forecast
Australia has found itself in an increasingly challenging and competitive labour market that is tightening globally.
In Australia, there are about 330,000 job vacancies, including about 10,000 in the mining sector and more than 20,000 in the manufacturing sector as of August 2025, according to the Australian Bureau of Statistics (ABS).
AREEA reports that the national decline is driven primarily by WA and NSW — both of which recorded their weakest pipelines in more than five years. WA fell from 48 projects and 11,065 jobs in 2024 to 42 projects and 8,924 jobs in 2025, while NSW dropped from 19 projects and 5412 jobs to just 11 projects and 3290 jobs.
While it appears that Queensland has firmly re-established itself as the nation’s second most attractive mining destination, defying the trend with its pipeline surging from 11 projects and 3527 jobs to 17 projects and 4412 jobs in 2025, there remains a risk that any new workforce demand could be offset by coal sector job losses.
Bankwest-Curtin Economics Centre Professor Michael Dockery says the mining industry has grown strongly, but industries associated with downstream processing have been declining in terms of employment.
“I suspect that these economics will continue into the future,” he said.
In October, Rio Tinto (ASX: RIO) began consulting more than 1000 workers at its Tomago aluminium smelter in NSW — Australia’s largest aluminium smelter — as it was unable to identify a pathway that supported commercially sustainable operations.
Rio also announced it will be cutting about 180 jobs as it reduces production at its Yarwun alumina refinery in Gladstone, Queensland from October 2026.
Alcoa (ASX: AAI) confirmed a $1.36b plan to permanently close its Kwinana alumina refinery in WA, citing the age of the facility, scale and operating costs, market conditions and bauxite grade challenges.
Also in Kwinana, IGO (ASX: IGO) announced it had little hope for its lithium refinery’s future, citing uncompetitive energy and labour costs.
“If we look at the censuses between 2011 and 2021, mining increased by about 38,000 jobs, but those downstream activities decreased by 54,000 or 30%,” Professor Dockery said.
“There’s a real contrast within the sector between those dimensions.”
Waning iron ore demand
While global analysts have been predicting a fall in iron ore demand for the past two years, iron ore remains highly profitable. Prices have remained considerably high — sitting at more than $150/t for most of 2025 — and major producers, including BHP, Rio Tinto and Fortescue, have consistently shipped ore from pit to port for about $25- 40/t.
Australian Workers Union (AWU) national mining organiser Shane Roulstone says the sector is not facing the kind of demand collapse that would lead to widespread job losses.
“What we are seeing instead is a slow structural shift, with some softening in employment driven more by company-specific changes than by global markets,” he said.
In 2025, BHP announced it would be winding down operations at its Yandi iron ore mine in the Pilbara region of WA. However, the company continues to ramp up operations at its nearby South Flank site, potentially creating opportunities for its displaced workforce.
Despite concerns that production from Rio Tinto’s West African Simandou iron ore project, dubbed the “Pilbara killer”, will impact the Australian industry, WA iron ore is likely to remain Rio Tinto’s crown jewel for the foreseeable future. The company has multiple growth projects underway, including a $1.1b investment to extend the West Angelas mine in WA and a $2.4b investment to develop the Hope Downs 2 project, also in the Pilbara.
Fortescue (ASX: FMG) and Gina Rinehart’s Hancock Prospecting are also pursuing growth and expansion projects across the country.
“Major producers have expanded, more than 20 previously closed mines have reopened and the resulting growth has effectively offset any employment losses in iron ore,” Mr Roulstone said.
“This has kept mining-sector employment broadly stable.”
Critical minerals shift
In recent years, critical minerals have been a hot topic for industry as governments have become weary of China-dominant supply chains.
Though the critical minerals sector is beginning to shape the future workforce, the influence it will have is largely unknown and likely to be slow.
“Critical minerals are a real wild card,” Professor Dockery said.
“Some projections show over the next five years we may see a 7% or so increase in workforce — and that’s been revised down largely changing sentiment surrounding lithium.
“Including nickel and copper, the total national critical minerals workforce is still likely under 15,000.”
The signing of the Australia-US rare earths and critical minerals framework in 2025 provides long-term investment certainty, but a shift towards new projects significantly influencing employment levels will not occur over night.
PwC reported that Australia has 124 “investment-ready” critical minerals projects positioned to capitalise on surging global demand but, according to the Reserve Bank of Australia (RAB), it can take critical mineral projects more than 10 years to go from the exploration to the production stage.
To support a shift that will create greater demand for technical specialists, processing and refining workers and regional project development roles, Australia will need to develop more progressive processing and refining capabilities onshore.
“The concern I have with the Australia-US critical minerals agreement is it’s geared to try and reduce China’s dominance in the critical minerals market. However, where China really dominates is in the downstream process and refinement,” Professor Dockery said.
“For us to counter China’s dominance, as the agreement is intending to do, requires that further processing — and the economics are really against us.”
One of the Federal Government’s focus areas in its Critical Minerals Strategy is growing a skilled workforce to enable the sector’s desired development, especially in downstream processing, but it is yet to clarify how it will do so.
“I’m not particularly positive about that agreement nor the critical mineral side of things. Our staples, such as gold and iron ore, are much healthier,” Professor Dockery said.
According to PwC Australia, total market capitsalisation in FY25 reached $128.6m, of which gold accounted for $64.8b and critical minerals, including copper, just $37.1b.
“Record high gold prices have transformed the gold sector into a jobs engine,” Mr Roulstone said.
The industry’s AI future
Advanced technology integration in the mining industry is reshaping the future of jobs, but it is doing so in a far more complex way than simple job loss predictions suggest.
Most major miners are moving toward autonomous operations, although the transition has not been without setbacks.
“Rio Tinto’s 2024 autonomous train derailment, which shut the main line for five days and cost the company many millions, demonstrated both the scale of the challenge and the stakes involved,” Mr Roulstone said.
“Even so, Rio continues to lead the industry, with its automation program now more than 60% complete.
“BHP, by contrast, has postponed its Area C automation project and is now targeting mid-2027 for completion, while Fortescue is only just beginning to introduce properly automated operations.
“Rio has already spent more than $10b on its automation push and, while BHP and Fortescue will not need to invest quite as much, they will still spend billions to catch up.”
As these systems mature, automated operations are creating new forms of employment rather than eliminating all on-site work.
“Remote operating centres provide ongoing, skilled technical roles and recent reviews indicate that automated sites typically operate with staffing levels at about 65% of non-automated sites,” Mr Roulstone said.
“Importantly, that figure is not expected to fall further over the next decade because the need for tradespeople and technicians on-site actually increases in an automated environment.
“The major mining companies are, for now, managing the workforce impacts reasonably well, but this task will become more difficult as more sites move toward full autonomy.
“Mining companies remain acutely aware that their social licence to operate is tied to the jobs they sustain in regional communities, and that awareness is shaping how quickly and how aggressively they move.”
The Federal Government expects the use of AI to alter the labour market, significantly so for white-collar employment, including administrative roles, technical professionals and middle management.
“Australian Mining and Automotive Skills Alliance (Ausmasa) is currently finalising projected figures, but the early indicators are troubling. The mining sector is likely to lose between 30,000 and 40,000 white-collar jobs over the next decade as AI replaces routine analysis, reporting, planning and supervisory functions,” Mr Roulstone said.
“The most significant employment risks lie not at the pit face but in offices, control rooms and corporate headquarters, where AI is poised to drive major structural change across the next ten years.”
AI is not yet eliminating frontline mining work on the scale once predicted — it is reshaping it.
“The impact of AI is still an unfolding story,” Professor Dockery said.
“Nobody is certain, but on all the international evidence I’ve seen, where they have tried to actually quantify those impacts, mining generally rates fairly low as an impacted sector.”
Is advanced technology creating a skills gap?
Jobs and Skills Australia’s Our gen AI transition report found that, over time, Australia has experienced steady growth in the share of higher-skilled and non-routine work, including those requiring digital capabilities.
The report found that at the same time, many occupations involving routine and repetitive work tasks have experienced slower rates of growth and technological change since the latter half of the 20th century has typically been viewed as complementary to those with higher skills.
“The shift toward more technologically advanced operations is already creating pressure on the industry’s skill base and that pressure is likely to intensify,” Mr Roulstone said.
“While there is hope that some of the workers whose roles are displaced by AI will be able to upskill into new technology-focused positions, the reality on the ground is that automation is already driving a significant skills shortage.
“The industry is currently short by roughly 2000 electricians and heavy diesel mechanics, and that gap is widening as more equipment becomes electrified in line with the sector’s decarbonisation goals.
The MCA reports that modern mining workforces increasingly require leading edge technical skills, including advanced engineering and mathematics, robotics and communications, in addition to the traditional employment in engineering, trades, chemistry and environmental science.
Technological innovation will continue to change the nature of work in mining and therefore skills requirements. As mining companies continue to automate and electrify their fleets and processing systems, the demand for highly skilled tradespeople and technicians is expected to increase.
“Without a concerted effort to expand training pathways, apprenticeships and mid-career transition programs, the sector risks developing not only a growing labour shortage but a broader education deficit that will constrain future growth,” Mr Roulstone said.
“The industry’s ability to retrain existing workers will help, but it will not be enough on its own to meet the scale of demand created by advanced technologies.”
The next generation
A 2024 survey conducted by CSIRO, Australian attitudes towards mining, found that 71% of respondents believe mining is important to the Australian way of life.
Despite this, mining is not currently considered an aspirational industry for young technical talent, with the Australian Minerals Tertiary Education Council reporting a 63% drop in mining engineering enrolment in Australia since 2014.
As a result of shifting attitudes, mining companies are experiencing a talent squeeze — 71% of mining leaders are finding the talent shortage is holding them back from delivering on production targets and strategic objectives, according to McKinsey.
There are many factors that are likely to be adversely affecting attitudes towards mining, such as publicised safety issues, Indigenous relations conflicts and perceived workplace culture.
Gen Z perceptions of mining survey, conducted by Ausmasa, found that 62% of young people say media reports overall negatively impact their view of mining and 77% have moderate to serious concerns about workplace culture, diversity, safety and respect.
The same survey found that just 24% of young Australians are interested in undertaking subsidised education and training for a promised mining job.
Skills shortages coupled with a reluctance of young people and recent graduates to join the mining sector present a real risk for the sector more broadly but also for the critical minerals industry.
The Australian resources sector has proved its resilience time and time again.
Though the long-term future surrounding the country’s established resources, iron ore and coal, are uncertain, Australia is not lacking in diversification opportunities. With the global energy transition well underway, Australia is beginning to home in on the opportunities presented by its abundant reserves of strategic and critical minerals.
The Queensland Government recently secured a $3b investment for the development of the colossal Eva copper project near Mount Isa, which is set to create about 1450 jobs.
In South Australia, BHP’s Olympic Dam copper project now employs more than 3000 people — an increase of roughly 1000 workers in just two years.
Considered as a whole, the resources job market is being reshaped slowly by multiple factors with an overall trajectory of stability in the short term and diversification in the long term.
The industry is changing, there is no denying that, but change is not inherently good or bad — just different.
