Local Content Policies in the Mining Sector: Stimulating Direct Local Employment

The Intergovernmental Forum on Mining, Minerals, Metals and Sustainable Development (IGF) is a voluntary initiative supporting over 70 nations committed to leveraging mining for sustainable development to ensure negative impacts are limited and financial benefits are shared.

One of IGF’s priorities is to help member states as they seek to maximize local employment and supply chain opportunities throughout the mining lifecycle. An estimated 90 per cent of resource-rich countries employ some sort of local content policy to promote local social and economic impacts. However, it is not clear which policies work best in different contexts.

Square Circle reviewed local content policies and strategies for direct employment as part of a broader set of inputs on enhancing local content in the mining sector prepared for IGF in collaboration with the International Institute for Sustainable Development (IISD).

Our report critically investigates the objectives that drive governments to introduce policies for local employment in the sector; provides an overview of a process that can be used to develop policies to promote direct employment; outlines regulatory and facilitative approaches to regulating supply and demand for domestic labour in the mining sector; and presents some general principles to help governments and policy-makers create inclusive and well-informed local employment policies in line with national development strategies. The report also presents six case studies offering insights into the implementation of policies to promote local employment in the mining sectors in Chile, Canada, South Africa, Ghana, Australia and Papua New Guinea. Our review also offers insight into the development of effective policy frameworks that incorporate the social impacts of development and direct local employment policies, especially for women and indigenous peoples.