Coal Companies Go Mining For Workers [BlackDiamond]
Coal industry and union executives are concerned that Pennsylvania soon could face shortages of skilled coal miners that already are cropping up elsewhere in the other Appalachian Basin states of Ohio, West Virginia, Maryland, Virginia and Kentucky.
In much of central Appalachia, "We've just been starved for experienced miners," said Katharine Kenny, director of investor relations for Richmond, Va.-based Massey Energy Co., the nation's fourth-largest producer. "We never have what we need. We're always 200 to 300 miners short of where we want to be."
While coal producers in Pennsylvania have yet to feel such a pinch, "We see a problem up the road if we don't start doing something" to step up recruitment, said George Ellis, president of the Pennsylvania Coal Association, the industry's Harrisburg-based trade organization.
Spurred by increased global demand for metallurgical coal -- especially in China -- rising electricity consumption and a surge in oil prices, coal mining companies saw their industry begin to boom last year after a 20-year slump that brought mine shutdowns and layoffs.
The lack of hiring in the past two decades -- exacerbated by new technology that eliminated many mining jobs and increased the skills needed to be a miner -- has left the industry with outright labor shortages in some industry strongholds, such as southern West Virginia and Eastern Kentucky, and a rapidly aging work force in others, including Pennsylvania.
To head off the kinds of problems seen elsewhere, United Mine Workers of America District 3, based in Belle Vernon, is seeking $4.6 million in state funding for a training center in Greene County, said Ed Yankovich, the district's international vice president.
Union and industry officials also are discussing a proposal to ask state regulators to recognize skill certifications experienced miners obtain outside Pennsylvania. Other key mining states already provide the so-called "reciprocity," Yankovich said.
Companies such as Upper St. Clair-based Consol Energy Inc., which plans next year to begin a $500 million expansion project -- the largest in its history -- in Washington County, also are taking steps on their own to avoid shortages in Pennsylvania.
Among other things, the nation's third-largest coal mining company is working with technical schools and "going to every job fair we can attend," said Tom Hoffman, Consol's vice president of investor relations.
Consol has seen shortages first-hand at its mines in Eastern Kentucky and other "more remote" towns in the Appalachian Basin, he said.
In Consol's Pennsylvania operations, hiring hasn't been as much of a problem because the metropolitan area offers a larger labor pool, Hoffman said, adding that it has been able to attract its share of available workers by increasing wages.
Still, Consol's need for skilled mining personnel -- including not only miners but mine electricians, engineers and foreman and others -- will escalate in the state as retirements take a toll on its existing work force, Hoffman said.
"We really haven't recruited in a generation," he said, adding that he expects that will change. "I will tell you we're going to be hiring hundreds of people a year. We've got 7,000 employees and 3,500 to 4,000 are set to retire over the next five to 10 years."
Like many industrial era companies, coal producers "lost a generation" of recruitment during the sector's slump and now has workers whose average age is in the 50s, said Ellis of the state coal association.
At the same time, many of the coal towns that dot the Appalachian Basin saw their younger people, many of whom would have followed their fathers into the mines a generation ago, leave the region for opportunities elsewhere.
The population loss, the industry's reputation for dirty and dangerous work and its history of boom-and-bust cycles may make recruitment difficult, industry experts acknowledged.
Additionally, because of the new technology and equipment now prevalent in their industry, coal producers increasingly are competing for workers with the technical skills who have options outside of mining.
"The days of hiring guys because they have big muscles is gone," said Hoffman at Consol. "Those are the challenges."
On the industry's side are wages that average $53,000 a year without overtime and significant improvements in mine safety, said the coal association's Ellis.
It helps that the jobs also aren't as physically demanding as they once were thanks to pervasive automated equipment, said Kenny at Massey Energy.
Still, Massey Energy has had to raise wages to compete for new workers and to be much more "creative" about recruitment, she said.
The producer last year went so far as to fly a plane pulling a banner over Myrtle Beach, S.C., during the summer in hopes of recruiting former West Virginia miners, many of whom historically took vacations there.
Through a variety of recruitment efforts, Massey Energy hired 1,800 new miners last year but hung onto only 600, largely because many who faced commutes of an hour or longer were lured away by small mine operators that were closer and paid more, Kenny said. At the end of 2004, the company employed 5,000, including 4,500 miners.
Kenny said lots of younger, single workers weren't as interested in the company's health plan -- one of few that doesn't require employees to share premiums -- as they were in making more money. But the company tries to make its benefits competitive to retain workers, she noted.
Kenny said Massey Energy also has increased wages to remain competitive, with raises in October that were as high as 7 percent.
Mining personnel with higher skills, such as mine electricians, now make as much as $100,000 a year, up from $70,000 several years ago, Kenny estimated. She said wages for those without specialties are as high as $60,000 a year, up from a high in the neighborhood of $50,000 a few years back.
"Everyone's wages have escalated," she said. "In this environment it's a sellers' market of miners being able to go wherever they want."
In much of central Appalachia, "We've just been starved for experienced miners," said Katharine Kenny, director of investor relations for Richmond, Va.-based Massey Energy Co., the nation's fourth-largest producer. "We never have what we need. We're always 200 to 300 miners short of where we want to be."
While coal producers in Pennsylvania have yet to feel such a pinch, "We see a problem up the road if we don't start doing something" to step up recruitment, said George Ellis, president of the Pennsylvania Coal Association, the industry's Harrisburg-based trade organization.
Spurred by increased global demand for metallurgical coal -- especially in China -- rising electricity consumption and a surge in oil prices, coal mining companies saw their industry begin to boom last year after a 20-year slump that brought mine shutdowns and layoffs.
The lack of hiring in the past two decades -- exacerbated by new technology that eliminated many mining jobs and increased the skills needed to be a miner -- has left the industry with outright labor shortages in some industry strongholds, such as southern West Virginia and Eastern Kentucky, and a rapidly aging work force in others, including Pennsylvania.
To head off the kinds of problems seen elsewhere, United Mine Workers of America District 3, based in Belle Vernon, is seeking $4.6 million in state funding for a training center in Greene County, said Ed Yankovich, the district's international vice president.
Union and industry officials also are discussing a proposal to ask state regulators to recognize skill certifications experienced miners obtain outside Pennsylvania. Other key mining states already provide the so-called "reciprocity," Yankovich said.
Companies such as Upper St. Clair-based Consol Energy Inc., which plans next year to begin a $500 million expansion project -- the largest in its history -- in Washington County, also are taking steps on their own to avoid shortages in Pennsylvania.
Among other things, the nation's third-largest coal mining company is working with technical schools and "going to every job fair we can attend," said Tom Hoffman, Consol's vice president of investor relations.
Consol has seen shortages first-hand at its mines in Eastern Kentucky and other "more remote" towns in the Appalachian Basin, he said.
In Consol's Pennsylvania operations, hiring hasn't been as much of a problem because the metropolitan area offers a larger labor pool, Hoffman said, adding that it has been able to attract its share of available workers by increasing wages.
Still, Consol's need for skilled mining personnel -- including not only miners but mine electricians, engineers and foreman and others -- will escalate in the state as retirements take a toll on its existing work force, Hoffman said.
"We really haven't recruited in a generation," he said, adding that he expects that will change. "I will tell you we're going to be hiring hundreds of people a year. We've got 7,000 employees and 3,500 to 4,000 are set to retire over the next five to 10 years."
Like many industrial era companies, coal producers "lost a generation" of recruitment during the sector's slump and now has workers whose average age is in the 50s, said Ellis of the state coal association.
At the same time, many of the coal towns that dot the Appalachian Basin saw their younger people, many of whom would have followed their fathers into the mines a generation ago, leave the region for opportunities elsewhere.
The population loss, the industry's reputation for dirty and dangerous work and its history of boom-and-bust cycles may make recruitment difficult, industry experts acknowledged.
Additionally, because of the new technology and equipment now prevalent in their industry, coal producers increasingly are competing for workers with the technical skills who have options outside of mining.
"The days of hiring guys because they have big muscles is gone," said Hoffman at Consol. "Those are the challenges."
On the industry's side are wages that average $53,000 a year without overtime and significant improvements in mine safety, said the coal association's Ellis.
It helps that the jobs also aren't as physically demanding as they once were thanks to pervasive automated equipment, said Kenny at Massey Energy.
Still, Massey Energy has had to raise wages to compete for new workers and to be much more "creative" about recruitment, she said.
The producer last year went so far as to fly a plane pulling a banner over Myrtle Beach, S.C., during the summer in hopes of recruiting former West Virginia miners, many of whom historically took vacations there.
Through a variety of recruitment efforts, Massey Energy hired 1,800 new miners last year but hung onto only 600, largely because many who faced commutes of an hour or longer were lured away by small mine operators that were closer and paid more, Kenny said. At the end of 2004, the company employed 5,000, including 4,500 miners.
Kenny said lots of younger, single workers weren't as interested in the company's health plan -- one of few that doesn't require employees to share premiums -- as they were in making more money. But the company tries to make its benefits competitive to retain workers, she noted.
Kenny said Massey Energy also has increased wages to remain competitive, with raises in October that were as high as 7 percent.
Mining personnel with higher skills, such as mine electricians, now make as much as $100,000 a year, up from $70,000 several years ago, Kenny estimated. She said wages for those without specialties are as high as $60,000 a year, up from a high in the neighborhood of $50,000 a few years back.
"Everyone's wages have escalated," she said. "In this environment it's a sellers' market of miners being able to go wherever they want."
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