Gold Rush Down Under
by Tim Skelton

In terms of the global economic outlook, there is a great deal of doom and gloom around at the moment. Europe is being brought to its knees by euro crisis after euro crisis, and the US economy is faring worse, even if they try not to admit it and attempt to divert the world’s attention by blaming the Europeans. On both sides of the Atlantic there is talk of stagnation and a double-dip recession. But another region is bucking the trend and doing rather better - Australasia.

According to recent figures, the Australian economy gained 10,100 new workers in October 2011. This followed a gain of 22,500 in September, and jobs growth is averaging around 17,000 a month. Queensland alone has added 17,900 new jobs, thanks to the expansion of its mining, natural gas, and transportation projects. Another 25,000 jobs are expected in Queensland by late 2012, on the back of similar projects, says the industry funded group Construction Skills Queensland.

Also in the news in the Southern Hemisphere are BG Group, Santos and ConocoPhillips, all of whom are developing liquefied natural gas (LNG) projects off the Queensland coast worth a combined AU$50 billion. And the Shell subsidiary Arrow Energy and PetroChina are also planning a new LNG development in Queensland. Conoco’s LNG venture alone, with its partner Origin Energy, will create 6,000 construction jobs, the companies said earlier this year.

IT’S A GAS

It should not really be any surprise that Australia is entering a new golden age of gas extraction. The nation has long been rich in resources. But with recent advances in LNG transportation and storage, the gas is no longer limited to where it can be transported by pipeline, turning the country into one big energy ‘supermarket’. Delegates at the recent Australian Gas Conference in Sydney were told the country has more than 15 LNG projects under consideration, and gas production is expected to triple within a decade. Moreover, its geographical location close to the thirsty economies of eastern Asia gives it an advantage over its rivals. One estimate is that when all the current projects are in production, Australia could supply 10% of China’s gas needs, 20% of Japan’s, and 30% of South Korea’s.

That’s a lot of gas, and things are moving incredibly fast. And that is just one sector. There are plenty of jobs going in the nation’s other heavy industries. In October the ANZ job advertisement series showed vacancies remaining strong in Western Australia, Queensland and the Northern Territory, driven by the strength of mining. At the end of September, BHP Billiton announced Australia’s resources industry would need an extra 170,000 workers in the next five years, again largely due to mining.

Whichever way you look at it, there is a great deal of activity Down Under. No wonder then that many recruiters are joining this apparent ‘gold rush’ and moving in. Several have recently set up new practices there. BWS International for example has just begun a 50/50 joint venture called BWS Cowan Australia to recruit engineers. “We currently only have two people working for clients there, but as soon as we get our work permit approval we will be taking on a lot more,” Claire Lowrie of BWS International says.

HEADING DOWN UNDER

We can certainly see the attraction. But what kind of packages are being offered to engineers from Europe? What are the projects that need all this extra manpower? And perhaps more importantly, how long can we expect this recruitment bubble to last?

We asked a number of people on the front line of this new bonanza what the fuss is all about.

“The Australian economy is going through a huge boom,” Marcus Ward, Operations Manager at NES Global Talent, says. This is mainly due to the resources sector within oil and gas, and mining. “Australia is developing a reputation as the powerhouse of the Asia Pacific region and appears to be recession proof and going from strength to strength,” he adds. “This coupled with the ongoing work life balance attraction of Australia makes it an exciting place to consider working at present.”

Simon Winfield, Senior Regional Director of Hays Resources & Mining, agrees. “Despite global economy uncertainty, most markets in Australia – and indeed across APAC – remain positive,” he says. “Our latest Hays Quarterly Report highlighted an increase in the number of Australian employers looking for overseas candidates to fill roles and a rise in international candidates looking for work across most of our industries and sectors including architecture, banking, engineering, facilities management, policy and strategy, information technology, oil and gas, sales and marketing and trades and labour.”

Again, there is one particular sector seeing a lot of expat activity, Simon adds, reflecting what everyone is seeing. “Any candidate with resources and mining industry experience is in a great position to pick and choose the roles they want,” he says. “There are plenty of opportunities in the market and this is drawing candidates from all over the world to Western Australia and Queensland, in particular, to take advantage of our second mining boom and secure a great career and better lifestyle.”

One company seeing the benefits of this is CPG Resources Pty Ltd, which delivers mineral processing and material handling solutions for the coal, industrial minerals and iron ore sectors. The company’s Senior Recruitment Advisor, Ross Cooper, says the longevity of various major construction projects in the oil/gas and mineral processing sectors that will commence in 2012/2013, involving both green and brownfield sites, will provide plentiful opportunities in Western Australia, Central Queensland, and the Hunter Valley in New South Wales. “These projects will range in value from AU$200 million up to AU$1 billion, which will see solid employment opportunities for at least the next three to five years,” he says.

As more and more projects get the green light, there has been an increase in demand for skilled and specialist workers across many trades and technical disciplines. Most projects are very complex and so finding people with the right skills and qualifications is of paramount importance. This is creating a market for expat workers as there simply aren’t enough local candidates to keep up with demand. “Oil & gas and mining are calling out for large numbers of people,” Marcus Ward says. “The main areas where people are needed is within project management and control, construction and contracts, with an ongoing requirement for suitably qualified design engineers.”

But while the market is undoubtedly booming, Trevor Whiting of JTC International Manpower Services Pty Ltd adds a note of caution for recruiters rubbing their hands at the prospect of riches. “No need to get overexcited, as many companies are employing their own in house recruitment teams and often cutting out agencies to find people,” he warns. “It’s not an easy market to crack if you are a recruiter straight off the boat. But there are plenty of projects happening all round in oil/gas and mining. It also seems that all construction and maintenance engineering trades are in demand. [We] have been awarded several projects to assist in the recruitment of personnel, so all interested people should send me their résumé!”

“In [CPG’s] case, as we deliver mineral processing and material handling solutions for the coal, industrial minerals and iron ore sectors, the skills we will be seeking over the next two years are: quantity surveyors (contracts administrators as we call them in Australia), project controls, project planning, mechanical/materials handling engineers, mechanical/mineral process engineers, chemical engineers, metallurgists, civil/structural engineers, project managers, construction managers, materials controllers, coal quality consultants, and mechanical/civil estimators, ideally with industrial/mineral processing construction/engineering experience,” Ross Cooper says.

For its part, BWS is involved in both Brisbane and Perth. “The main sector for us is in the oil and gas industry and we specialise in project controls, which in the main means contracts engineers, cost engineers, planning engineers, QA/QC engineers, HSE engineers and document controllers,” Claire Lowrie says

“There is strong demand for technically skilled candidates in Western Australia, particularly geologists with experience in mine or resources geology. [Hays] currently has over 100 geology jobs available on a temp and permanent basis. Drill and blast supervisors with experience in diamond exploration, water well and production are also highly sought,” Simon Winfield says “Over in Queensland there continues to be demand for geologists, mine engineers, mine surveyors and mine managers. There has been a spike in demand for candidates with coal experience, including hydro geologists and petrochemical engineers. Currently in the geology space there are around 200 permanent openings available in the market.”

But geology is not the only hotspot for Hays. The company has a list of skills in demand across Australia that is as long as your arm. It seems there are openings for almost everyone from Finance Managers, Auditors and Bankers to Civil Engineers, Health Workers and IT…

MONEY TALKS

So much for the opportunities. There is a small downside in that Australia imposes a disadvantageous tax regime on ‘non-resident’ workers, as was recently discussed in Nexus. The cost of living is also quite high. But the good news is that salaries often take this into account. “In Australia the salary package is normally comprised of a base salary and a standard 9% superannuation, which is based on your base salary and a form of compulsory saving for retirement,” Ross Cooper explains. “But in an expat’s case, should they decide to leave Australia and not become a permanent resident, this can be returned after a qualifying period.” In addition, Ross points out, the gross cost of a vehicle can be included in a salary package and is taxed at a different rate to the base salary component. “Then when an individual is required to work on site continually, site allowances are paid. These vary depending on site location, roster/hours worked per day, and can range from 15% up to 30%,” he says.

“Packages are based on experience with employers setting minimum and maximum salary brackets that they are willing to pay,” Simon Winfield adds. “That said, employers are still highly flexible and open to negotiation for certain roles. We have seen a lot of counter offer activity going on in the market for in demand talent. We are not seeing salaries being ‘grossed up’ for European expats, but instead employers will pay for relocation costs, including flights, accommodation and furniture.”

“Australian salaries are attractive in comparison to other worldwide salaries but these do need to take into account the tax circa 40% and the cost of living which is higher in Australia,” Marcus Ward says. But in general it’s not uncommon for a company to pay full relocation to Australia and help a worker to settle in, then employing them on a local package. Such workers may be eligible for a Living Away from Home allowance, in which you can claim rent and food pre-tax.

“Salaries can vary and are tailored around the candidate’s qualifications and experience, unless it’s an award-driven site,” Trevor Whiting says. “Tradespeople are paid as per the award and supervisors/engineers and all senior personnel negotiate their salary package or hourly rate. Rates can vary between AU$120k to 450k. The tax is very high, but there are allowances to minimise the tax rate for people on Work Visas.” Trevor adds that it is better to arrive in Australia as a Skilled Migrant as opposed to on a 457 Work Visa, as you have the choice to shop around the employment market.

SETTLING IN

Once you are in Australia, it certainly offers a good work/life balance and high quality of living. Having a stronger economy than many other parts of the world at present also means the country can offer more job stability and fewer barriers to entry than most.

And there is plenty of advice available for anyone considering relocating. “Don’t accept a job based on salary alone,” Simon Winfield – himself an expat - suggests. “Do your research on the company and make sure you are well informed – this is where your recruiter will help you to look at the career progression and development opportunities available to you. You do not want to move for a role that you won’t like and will leave in less than a year.”

Also research the locations you are interested in, which may be based on specific employment opportunities, lifestyle considerations or to be close to friends and relatives. “Once you have established potential locations you would like to live in then make enquiries with the Australian embassy about applying for either permanent residency or temporary work visas in relation to skills that have been identified as being needed in Australia,” Ross Cooper adds. “Also do research on Australian company careers websites that indicate they will consider Sponsorship on a 457 Visa basis. [CPG Resources] will consider & offer 457 Visa sponsorship and relocation assistance to individuals we identify as meeting our requirements, based on successful reference checks and pre-employment medicals.”

AN EXPAT VIEW

Expat Network member John Hirrill lives in Mindarie, just north of Perth, with his wife Nikki. Having been there over 5 years, they are both now Australian citizens. And like many members, John works in oil & gas and has recently taken a short-term role as a QC Welding Inspector on the Montara wellhead repair (a well in the East Timor Sea was damaged by a major oil fire in 2010). He says he has had plenty of work this year. But what was it that first tempted him to head south? “Originally it was for the weather, lifestyle, work opportunities and the cheaper cost of living,” he admits. “All those reasons still apply - apart from the cost of living which has soared in the short time we’ve lived here. Most things are at least double the price of the UK, but the salaries and pay rates compensate for this.”

There are certainly downsides to life in Australia, but the positives seem to far outweigh the negatives. “The weather, the outdoor lifestyle, the houses with pools, the ability to earn a good wage…” John says. “We are taxed up to the hilt, but there are lots of opportunities, great jobs working for international companies, and we are close to Asia for work and holidays. And it’s great to wake up in summer to 30-40 degree temperatures during the day, walk along the beach, soak in the pool and sit on the balcony watching the sun set over the Indian Ocean…

A HIGH COST

Despite the obvious benefits, there are still many things to consider - not least of all the aforementioned costs. The strength of the Australian Dollar means housing in Sterling terms can be very expensive – even renting can cost £250 to 300 a week. Salaries in excess of AU$100k may seem good on paper, but as mentioned the taxman is ready and waiting to take a large chunk of that. And there are other daily living costs. “Food (except meat) is very expensive,” John Hirrill says. “Other states can be slightly cheaper, but Queensland, WA and soon NT are driving the Australian economy, so they are also the most expensive to live in.”

Another unexpected cost is that some expat trades people, particularly plumbers and electricians, have to follow (and pay for) various courses when they arrive, before they are allowed to practise, but the government doesn’t always warn you of this in advance. It can drive costs up before you can legally work.

Trevor Whiting believes people should not arrive with unrealistic expectations. “For someone heading to Australia I advise them to come in as a skilled migrant first of all, and look at the cost of living as it is quite expensive for houses, food and drink. Perth is more expensive than London and Singapore for a pint of British ale in some pubs,” he says.

REMOTE

As with any expat move, the best advice is to do proper research and ask plenty of questions. And there is a particular note of caution for those coming to work in the energy and mining sectors. Australia is already a pretty big place, and most of the rigs and mines are in really out of the way sites. “Make sure you know where you will be working,” John Hirrill advises. “People have got here and been sent to mines/ remote sites on a 4 weeks on, 1 week off basis. It puts tremendous strain on a wife at home in a strange place looking after the kids. There are also 2 weeks on, 1 week off jobs on mine sites. So make sure your family is OK before you go off for weeks at a time.”

Trevor Whiting agrees. “Australia is a great place to live and work and there is plenty of opportunity for people that are willing to get stuck in,” he says. “However, many of the projects are in remote areas and the R&R roster is not always that great, i.e. 11 days on, 3 off, or 3 weeks on, 1 week off. Not good if the family is based in the city and the husband/wife is working away.”

SET TO LAST?

The good times are certainly rolling, but can it all be expected to last? Opinion is a bit divided on this front, but everyone seems to agree that it will continue for a few years yet. “Based on the proposed range of projects that are currently waiting to proceed, but are being hindered by shortages of relevant skills, I can see the Australian employment market remaining strong for at least the next 3 to 5 years,” Ross Cooper says.

Trevor Whiting agrees the boom will go on for a few more years. “I predict 3 to 5 years from now it will flatten out,” he says. But Marcus Ward is more optimistic. “This spate of work is due to last for circa 10 years,” he thinks.

“With so much activity going on in the booming resources and mining sector we expect to see this bubble last for some time. Employers are so confident of this many have plans to triple their workforce in the next few years,” Simon Winfield adds on a confident note. Claire Lowrie also describes BWS’s entry into the market as a “long-term investment.”

THE LAST WORD

With all the pros and cons (but let’s face it, mostly pros) of relocating to Australia, I will leave it to someone who has made the move permanently to sum up. “Even with all the taxes, GST (VAT) and all the cost of things, it’s still worth while coming here especially if you have a young family. There are loads of jobs available and will be for a while to come,” John Hirrill says. “Leave Blighty behind and take the plunge and wake up to the lovely Perth weather” If you are prepared to work hard and give it a ‘fair go’ - to use an Aussie phrase - it certainly is the Land of Opportunity. Wish we’d done it years ago.”

Thanks to all the following companies for their help in compiling this feature:

BWS International: www.bwsinternational.com
CPG: www.cpg-global.com
Hays: www.hays.com.au
INPEX: www.inpex.com.au
JTC International Manpower Services: www.jtcims.com.au
NES Global: www.nesglobal.com
Wood Group PSN: www.woodgroup-psn.com

The Writer - Tim Skelton

Dutch-based freelance writer Tim Skelton has spent the past 22 years living outside the UK, and has been a regular contributor to the Expat Network's Nexus magazine since 2004. As well writing on expat issues, he uses his engineering background and experience gained at the Dutch environment agency to comment and write about a variety of energy and environmental matters, and is always happy to wax lyrical about his personal favourite subjects - travel, food and beer. When not appearing in airline magazines, national newspapers and lifestyle magazines from Playboy to GQ, he has also written two books: Luxembourg - the Bradt Guide (2008), and Around Amsterdam in 80 Beers (2010).