Mining jobs slumping amid tax uncertainty

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By Reicelene Joy N. Ignacio

EMPLOYMENT in the mining and quarrying sector bounced back slightly in 2018 to 206,000 but remains below its 2015 levels, the Department of Labor and Employment (DoLE) said.

DoLE’s Bureau of Labor and Employment (BLE) Director Dominique R. Tutay said that the mining and quarrying sector employed 235,000 in 2015, which dropped to 219,000 in 2016. In 2017, the total declined to 203,000.

“Employment used to gain 50,000 a year on a net basis,” Ms. Tutay told BusinessWorld of the employment slowdown in the sector, in an interview in early January.

The Chamber of Mines of the Philippines (CoMP) said that it hopes the national government will address key issues that are weighing down the industry, including proposals for higher mining taxes as well as the ban on open-pit mining, to increase job opportunities in the sector.

“It is clear that this development is brought about mainly by the policy issues confronting the industry, including the moratorium on new mining permits and the ban on open pit mining,” Rocky G. Dimaculangan, Vice President for Communications of CoMP, told BusinessWorld in an e-mail.

“The sooner these issues are resolved, the better are the chances for the industry to recover so that it can generate more employment opportunities and contribute further to the socio-economic development of our nation,” Mr. Dimaculangan added.

According to Mr. Dimaculangan, “the bigger cause for concern for the Philippine mining industry is the ongoing moratorium on mining permits under Executive Order (EO) 79 and the ban on open pit mining under DENR (Department of Environment and Natural Resources) Administrative Order 2018-19. EO 79 states that the moratorium will not be lifted until a new mining tax regime is legislated, but despite the doubling of mining excise tax from 2% to 4% of gross output, the moratorium remains in place.”

The Department of Mining, Metallurgical, and Materials Engineering (DMMME) of the University of the Philippines Diliman said it has been a decline in the number of enrollees, though it added that some outside factors like the K to 12 program may have also been a factor.

“Employment has gone down but for our graduates from 2012 to 2016, local employment is maybe 60% with 5% continuing to graduate school and the rest going abroad. Where previous data show our graduates staying in the mining industry, now some have gone on to related areas such as construction, etc,” Eligia D. Clemente, DMMME Assistant Chair and Professor, said in an e-mail.

“The decline in student population for 2016 and 2017 was also affected by the shift to K to 12. All courses had low enrollment so the industry effect was probably masked,” Ms. Clemente said.

The Commission on Higher Education (CHED) said that despite the decline in employment opportunities in the Philippines for mining program graduates, universities should continue offering such degrees as there is still global demand for these professionals.

“There is a global demand so there is no reason to stop these programs,” CHED Commissioner Prospero E. De Vera III said in a chat message.

Mr. De Vera pointed out that “the problem is not the oversupply of mining and metallurgical engineers but oversupply from other programs.”

Mr. De Vera also said that “mining and metallurgical engineering are not very glamorous programs” as compared with industrial engineering, civil engineering, and electrical and electronics engineering (EEE).

“The enrollment is low and there are fewer HEIs (higher education institutes) offering these programs because you need geology courses in these programs and very few universities have good geology programs outside of UP,” Mr. De Vera said.

“As far as I know, the supply side for mining and metallurgical engineering has always been low compared to the demand side. That is the reason PNOC EC (Philippine National Oil Company Exploration Corporation) in 2017 gave P250 million to UP to produce more engineers and geologists because of this problem,” Mr. De Vera said.

Mr. De Vera is the former Vice President for Public Affairs of the UP System, prior to his designation as CHED Commissioner.

Ms. Clemente, meanwhile, said, that it is still UP’s aim to produce graduates that will work for the nation, and hopes that the mining sector’s problems will be resolved.

“We are working with the industry to address issues on social and environmental impacts and we have a very straight-thinking DENR Secretary now,” Ms. Clemente said.

Ms. Clemente also noted that some of the graduates proceed to take up Master in Environmental Engineering which lead them to have concerns on rehabilitation inherent in mining operations.

“Our primary target is to produce graduates for the Industry as well as federal for our graduate programs,” Ms. Clemente said.

St. Louis University (SLU), in Baguio, also a producer of mining graduates, saw a decline in their number of enrollees for the program.

“We started graduating mining students in 2013. Statistically, we have graduated 317 students with 284 passing the licensure exam from 2013 to date,” SLU Mining Engineering Department Head and Professor Romeo M. Santos said in an e-mail.

“Most of our graduates are working locally with about 75% employed either in mining companies, academe, and government agencies (Environmental Management Bureau, Mines and Geosciences Bureau, DENR, Department of Energy). About 3% are employed abroad in the mining industry. Our enrollees have declined 50% since the crackdown on illegal and irresponsible mining companies,” Mr. Santos added.

Mr. Santos said that mining industry is not dying due to stable demand for mining products.

Mapua University also reported a decline in the number of graduates related to mining in the last few years.

According to data provided by the Mapua University Registrar through e-mail, the institution produced 15 graduates in geology, geological science and engineering, as well as geological engineering and geology courses in 2013.

This number dropped to eight graduates in 2014, but rebounded to 14 in 2015; 27 in 2016; and 47 in 2017. There were 10 graduates in the first quarter of 2018.

“There is room in the Philippines for mining courses. It is not a dying industry. For as long as people need metals, cement, cosmetics, cars, cellphones, etc, mining will always be active,” Mr. Santos said.

Meanwhile, the BLE’s Ms. Tutay said that mining graduates can venture into various engineering careers.

“You will always find a niche in the other related sectors. So for instance, you can go into manufacturing, shipbuilding, construction,” Ms. Tutay said.

“Mining skills have an overlap in metallurgy and other industries,” Ms. Tutay added.