President Joe Biden's efforts to secure American supply chains and usher in a green energy revolution are being hampered by a shrinking pool of workers available to produce critical materials.
Data from the Bureau of Labor Statistics showed the domestic mining workforce shrinking by more than 20% over the past decade. That trend has only accelerated following the COVID-19 pandemic, and mining industry insiders tell the Washington Examiner that some companies aren't pursuing the federal funds included in Biden's bipartisan infrastructure law, CHIPS and Science Act, and Inflation Reduction Act over concerns that the dwindling worker pipeline will make it impossible to hit deliverable goals.
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Since 2016, mining graduations have dropped an additional 39% in the United States, according to a recent analysis from McKinsey and Company, while a similar report from Deloitte found the majority of the mining workforce over the age of 46, with half of all skilled engineers reaching retirement age in the next decade.
"Mining companies are experiencing a talent squeeze: 71 percent of mining leaders are finding the talent shortage is holding them back from delivering on production targets and strategic objectives," McKinsey's analysis reads. "Indeed, 86 percent of mining executives tell us it is harder to recruit and retain the talent they need versus two years ago — particularly in specialized fields such as mine planning, process engineering, and digital (data science and automation). We expect this trend to continue."
As president, Biden has authorized nearly $100 billion in grants, loans, and other incentives aimed at surging the domestic production of semiconductors, electric vehicle batteries, and their critical material components.
In interviews with the Washington Examiner, senior Biden administration officials acknowledged the workforce problems hampering a domestic mining revitalization but added that the president's supply chain and critical materials team is in constant contact with industry executives about how to address the matter.
"There are the kind of rumblings you hear from all industries right now about being able to secure a reliable and skilled pool of labor," one official stated. "But I don't think any of them have indicated — certainly, there are no mining projects that aren't going forward because of a lack of workers."
Officials noted that, due to current demand, domestic mines are "hitting record levels of production" and pointed specifically to MP Materials's Mountain Pass Rare Earth Mine and Processing Facility in California, which accounts for nearly 16% of global rare-earth production.
Asked about the high rate of turnover for younger miners, which contributes to the advanced age of the workforce, senior administration officials stressed the need for companies to enter into agreements with labor unions and claimed that the federal government is partnering with private industry to retrain fossil fuel workers and other union laborers in the skills necessary for critical mineral production.
One official pointed to a nickel proposal in Minnesota that "is going to be built with union labor and then has a workforce training and a kind of revolutionary kind of agreement with the steelworkers for both the training and operations phase of the mine."
The administration is also grappling with the reality that the open calls to boost domestic mining could run contrary to Generation Z's environmentalist leanings and is stressing to private industry the need to develop a "social license to operate."
"In our conversations with the industry, it has really been a more productive kind of dialogue than you might see in the headlines or in hearings or whatnot," one official stated. "Being able to do things upfront and early, like community engagement and signing these community benefits agreements and ensuring the tribes and local communities are at the table, I think is really a big part of changing that perception. We've seen some willingness to move there as well."
Despite the labor problems, the White House has secured some major wins in Biden's push to surge domestic mining. Ioneer, an Australian company, was awarded a $700 million conditional loan for its Rhyolite Ridge Lithium-Boron project in Nevada, which, when operational, will be just the second lithium mine in the U.S.
Perpetua Resources Idaho also received $24.8 million through the Defense Production Act Investments Program to complete "environmental and engineering studies necessary to obtain a Final Environmental Impact Statement, a Final Record of Decision, and other ancillary permits."
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The Department of Commerce has also received more than 200 Statements of Interest across 35 states since launching applications for CHIPS funding opportunities in February 2023, according to the White House, yet the exact number of mining companies vying for Biden's "Made in America" funds remains unclear, as there is no public visibility on the application process.