In its ‘Mining in Australia 2013 to 2028’ report, BIS said that the mining production could increase by almost 41% in the next five years, which is expected taking into account the projects being implemented by companies such as BHP Billiton (ASX: BHP), Rio Tinto (ASX: RIO) and Fortescue Metals Group (ASX: FMG), which are noticeably increasing their iron ore production.
"With respect to the mining boom, it’s probably fair to say that this is not the beginning of the end, but the end of the beginning," said Adrian Hart, Senior Manager of BIS Shrapnel’s Infrastructure and Mining Unit said.
"Over the next five years, the strong boost from mining production, led by LNG and iron ore, will more than offset the economic negatives from falling mining investment which will flow through to construction and manufacturing. Consequently, BIS Shrapnel is forecasting mining activity as a share of GDP to rise from 18.7 per cent to 19.8 per cent; Australia becomes a more mining-focused economy from here."
According to the report, the mining production increased by 8.8% in the past year, amounting to $151 billion, however in the next five years a 20% drop in the investment will be seen.
BIS Shrapnel's Adrian Hart remarked: "We expect that mining operations employment will rise only 11 per cent over the next five years, mainly in oil and gas and iron ore, whereas mining construction employment will slump 40 per cent."
According to the report, the exploration spending will not be affected by investment cuts. Around $7.3 billion was spent on exploration last financial year, three times bigger than the 2000s levels, and will remain around this mark for the next five years.
This focus on efficiency and long-term sustainability is predicted to generate both challenges and opportunities for the METS sector.
The METS (mining equipment, technology and services) sector is estimated to be worth more than $90 billion dollars and creates jobs for more people than the mining sector; the latest figure being approximately 386,000 people.
"The METS sector represents the mining jobs of the future," METS advocate and former Queensland Premier Peter Beattie said at a recent industry event.
"This sector will create the dynamic, high tech, highly innovative jobs that are needed to engage those young people and ensure continued employment growth for generations to come."