Local Content Policies in the Mining Sector: Stimulating direct local employment

This report by the International Institute for Sustainable Development (IISD) examines policies and strategies used by governments to promote direct local employment in the mining sector. It outlines a five-step process for developing local employment policies and categorizes interventions into regulatory 'stick'-based approaches and facilitative 'carrot'-based incentives. The document emphasizes the importance of matching labour supply with industry demand, promoting gender equity and Indigenous participation, and preparing for technological shifts such as automation.

• Governments implement local employment policies in mining to achieve several strategic goals: responding to political pressure for job creation, securing a "social licence to operate" for projects, increasing national tax revenues, developing the national labour force's skills, promoting gender equality and social inclusion, and maximizing fiscal revenues by reducing company operational costs.
• The report proposes a five-step framework for developing local employment policies: 1) assessing mining's role in national development, 2) evaluating labour force supply against industry demand, 3) setting local content goals and defining "local," 4) formulating a mix of regulatory and facilitative strategies, and 5) monitoring, evaluating, and forecasting.
• Regulatory approaches to local employment are mandatory and rely on compliance mechanisms, such as financial sanctions or loss of licences. Common regulatory tools include mandated minimum percentages of local employees (quotas), required training of local workers, succession or localization plans, visa restrictions on foreign workers, and mandated reporting standards.
• Facilitative approaches use incentives to encourage local hiring. These include giving preference in the bidding process to companies with strong local employment strategies, using non-binding provisions that local people be hired "to the extent feasible," providing fiscal incentives like tax deductions or subsidized financing, and offering government support for the creation of education and training facilities.
• The definition of "local" varies by country: some define it as any citizen resident in the country (e.g., Nigeria, Ghana, Angola, Indonesia), while others prioritize those in communities immediately surrounding the site (e.g., Philippines, Papua New Guinea) or specific ethnic and social subgroups (e.g., Indigenous peoples in Canada and Australia).
• Women are significantly under-represented in the global extractives workforce, estimated at only 10 per cent. Effective gender equity policies must go beyond recruitment to address workplace culture, including anti-discrimination and anti-harassment mechanisms and flexible working conditions to accommodate family responsibilities.
• The report highlights that the mining sector's contribution to direct employment is relatively small, typically around 1–2 per cent of a country's total direct employment, though this can increase to 3–15 per cent when indirect and induced employment are included.
• Technological trends, particularly automation, are expected to impact the number and types of jobs available in the future. This may lead to a decline in the overall number of jobs and a shift in the skills required, necessitating that governments and industry prepare alternative livelihood projects.

APA

Grice, T. (2018). Local Content Policies in the Mining Sector: Stimulating direct local employment. International Institute for Sustainable Development. https://www.iisd.org/system/files/publications/local-content-policies-mining-direct-local-employment.pdf

Chicago

Grice, Tim. Local Content Policies in the Mining Sector: Stimulating direct local employment. International Institute for Sustainable Development, 2018. https://www.iisd.org/system/files/publications/local-content-policies-mining-direct-local-employment.pdf.

Wikipedia

{{cite report |last1=Grice |first1=Tim |title=Local Content Policies in the Mining Sector: Stimulating direct local employment |publisher=International Institute for Sustainable Development |date=October 2018 |url=https://www.iisd.org/system/files/publications/local-content-policies-mining-direct-local-employment.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{grice2018local, author = {Grice, Tim}, title = {{Local Content Policies in the Mining Sector: Stimulating direct local employment}}, institution = {International Institute for Sustainable Development}, year = {2018}, month = oct, url = {https://www.iisd.org/system/files/publications/local-content-policies-mining-direct-local-employment.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }