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

The document examines how host governments can stimulate direct local employment in mining to drive socioeconomic growth and maintain a social licence to operate. It outlines a five-step process for developing local employment policies: assessing the sector's role in national development, evaluating labour supply and demand, setting goals, formulating policies, and monitoring outcomes. The report categorizes interventions into regulatory 'stick' policies—such as employment quotas, mandated training, and visa restrictions—and facilitative 'carrot' policies, including bidding preferences, fiscal incentives, and support for training facilities. It emphasizes the need for context-specific strategies that address gender inequality and the inclusion of Indigenous Peoples, while warning that automation and technological trends may shift future workforce requirements.

• Mining's contribution to direct employment is relatively small, estimated at around 1–2 per cent of total direct employment in a country, though this can increase to 3–15 per cent when indirect and induced employment are included.
• Governments use local employment policies to achieve several objectives: responding to political pressure for job creation, maintaining a "social licence to operate," increasing tax revenues, developing the national labour force, progressing gender equality and social inclusion, and maximizing fiscal revenues by reducing project costs.
• Regulatory approaches to local employment typically involve mandatory, compliance-based policies such as minimum employment quotas, which are common in developing states but can stifle investment if targets are unrealistic.
• Facilitative approaches use incentives to encourage local hiring, such as giving preference in the bidding process to companies with strong local employment strategies or providing tax deductions for training expenses.
• Succession or localization plans are used to transition technical or management roles from expatriates to locals; for example, Nigeria's law allows a local to understudy an expatriate for a maximum of four years before the position is "Nigerianized."
• Women are significantly under-represented in the global extractives workforce, estimated at only 10 per cent, and policies must address workplace culture and safety beyond simple recruitment to be effective.
• Local content policies can be used to facilitate the participation of Indigenous Peoples through formal agreements, such as Impact and Benefit Agreements (IBAs) in Canada or the Argyle ILUA Management Plan in Australia.
• Technological trends, particularly automation, are expected to impact the number and types of jobs available in the future, potentially reducing the overall number of positions and changing skill requirements.

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} }