Changing Community Dynamics – the impact of Fly-in Fly-out , Drive in Drive Out
Presentation to Local Government Chief Officers
Group 21st November 2013
Professor Fiona Haslam McKenzie
Background to the study …
• We embarked on this study because: • Understanding the impact of fly-in/fly-out is part of the Enduring
Community Value from Mining research program • We successfully bid on Commonwealth research funds • We received top-up funds and considerable inkind from an industry
partner (Rio Tinto) (Busselton component).
• The impact of fly-in/fly-out and host communities has been examined however the impact on source communities has not.
• ~ 1/3 of submissions to the House of Representatives Enquiry into fly-in/fly-out work arrangements were from source communities
• Most of the submissions were based on anecdotal information
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Research questions
• What are the socio-economic impacts of a fly-in/fly-out population on source communities?
• What are the economic and administrative implications of a FIFO population cohort for local government, government and non-government agencies, mining companies and local business communities? (Does a fly-in/fly-out population put undue pressure on services?
• the effects of a significant LDC population cohort on the wider community structures, networks and arrangements vital to individual and community wellbeing and social cohesiveness.
• What are the employee and communities benefits? • Could the benefits be enhanced, and if so what are the strategies?
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The case studies: Mandurah and Busselton
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- Shire Boundaries
Regional Boundary
Built Up Area
The economic impacts – individual level (1)
• High income is the most commonly cited incentive for entering LDC workforce.
• The mean annual income in the Busselton local government
area (LGA) is $43,665.
• Anecdotally the difference between working in an LDC position in mining or an equivalent local position in Busselton or Mandurah is approximately $40,000 pa.
• Salary structures and working conditions vary widely between oil and gas, and mining companies and contractors to mining.
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The economic impacts – individual level (2)
Busselton survey respondents: LDC and LDC spouse income distribution
0
5
10
15
20
25% GROSS WEEKLY PERSONAL INCOME PER WEEK
I currently work LDC in the mining/oil & gasindustryI have a spouse who currently works LDC in themining/oil & gas industry
The economic impacts – individual level (3)
• LDC enables many families to live where and how they want to live. • Survey and interview cohorts included individuals who where:
Living in the case study sites and moved to LDC because of new job opportunities and/or financial pressures:
in LDC who moved to the case study sites for lifestyle (direct flights from Busselton to Rio mines especially influential).
Some to Busselton from Mandurah ‘which had become “too busy”.
• Coastal lifestyle was important to 70%, rural lifestyle to 50%
The economic impacts – individual level (4)
Survey and interview cohorts in both case studies included individuals who had moved to LDC work because of financial pressures:
o contraction in local economy/ loss of job,
o recovery from financial set back (eg. post divorce),
o Supplementing income from, or funding the development of agricultural enterprise,
o were older and appreciated the opportunity to bolster their
superannuation or savings.
“Thanks to this job, I can look forward to a comfortable retirement in a place I only ever dreamed about. For the first time in our working lives, my [spouse] and I are not struggling”.
The economic impacts – individual level (Savings)
Busselton survey respondents: Household savings
88
60 60 60
12
40 40 40
0
10
20
30
40
50
60
70
80
90
100
25-34 35-44 45-54 55-64
%
Age groups
Regularly save a portion of your HOUSEHOLD income?
No Yes
The economic impacts – individual level (Wealth accumulation)
Busselton survey respondents: Change in wealth
31%
35%
25%
6%4%
0% 0%0%
5%
10%
15%
20%
25%
30%
35%
40%
increasedsignificantly
increasedsomewhat
little or nochange
decreasedsomewhat
decreasedsignificantly
I have nopersonalwealth
Other (pleasespecify)
Has the overall wealth of your HOUSEHOLD (savings, investments, property) changed in the past 5 years?
The economic impacts – individual level (debt level)
Busselton survey respondents: Debt level
65%
10%
23%
2% 0%0%
10%
20%
30%
40%
50%
60%
70%
increased no change decreased don't know no debt
Has you overall level of HOUSEHOLD debt (mortgage, loans, hire purchase, credit card) changed in the past 5 years?
The economic impacts – community level (Salaries by local government and postcode for a mining company cohort: Busselton area)
The economic impacts – community level (2)
• Airport fees incurred by mining companies flow direct to the local government authority (Busselton).
• Mining company sponsorship of community events and even infrastructure.
• LDC source communities gain directly from the higher incomes their commuters repatriate.
• Indirect multiplier effects: LDC money spent locally
bolsters local businesses and is likely to be re-spent in the local economy.
The economic impacts – community level (3)
• Economic leakage from both case study sites occurs due to:
• Expenditure outside of the local community • Choice and price • Overseas purchases and holidays • Internet purchases.
• Time and costs associated with travelling to airport or DIDO destination.
• High cost of housing and accommodation (mortgage repayments and
rental to non-resident property owners). • Savings and superannuation.
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Impacts on individual wellbeing: • The LDC workforce is diverse, as are the conditions of work. • Long distance commuting is a tough gig for both the LDC
worker and the family at home: o Loneliness/ sadness o Periodic separation/reunion - switching modes of engagement o Fatigue for both parties o Parenting
issues of consistency role models Accessibility
o Gendered roles o Balancing distinctive rhythms of LDC with main-steam rhythms
• Most individuals and families who make the choice work
through the challenges, although this is rarely easy.
Impacts on individual and family wellbeing: support
Sense of wellbeing is also influenced by quality, availability and accessibility of formal and informal support services and networks:
• LDC worker like everyone else need support at times.
• While not the primary cause where there is a propensity for personal and relationship or social engagement problems, the stresses particular to a LDC lifestyle tend to have a compounding effect.
• Services report that growth associated with LDC is contributing to growing demand on services/ but LDC usage is not routinely measured.
• The rhythms of an LDC lifestyle make it difficult to access existing services and associations designed around 9-5 /5 day working week.
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The social impacts … community cohesion, participation and resilience
• Social tensions- Evidence of a widening gap between ‘the haves’ and the ‘have nots’ in source communities.
• No definitive evidence re reported lack of engagement
in community life. Many LDC workers do volunteer in their home community using skills developed at their work. Others admit to being insular.
• Increasing FIFO population creates a potential community vulnerability to the resource sector market cycle – are communities prepared for that?
Key recommendations: Pressing need for companies to provide: • pre employment preparation for employee and spouse/families for
demands of LDC including basic personal financial management. • recognize role of spouse through tailored orientation, direct
communications concerning entitlements and support services • work with service providers to pilot flexible compatible services
• LDC workers and their families need to be fully aware of the personal and
community challenges of the lifestyle
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Key recommendations to local government sector: Long distance commuting: • will often bring new people to town, some of whom need support • local government to work with service providers to pilot flexible
compatible services • community organisations need to work collaboratively on initiatives to
strengthen ties across new ‘class’ divisions, integrate newcomers and foster informal as well as formal support networks.
• Develop strategies to minimize economic leakage. • Strategies to encourage community inclusiveness and sense of
community.
• Do not look a gift horse in the mouth – resources companies are businesses and corporate social responsibility only goes so far.
• The resources sector will not boom forever – how well equipped are you for the future contractions?
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Acknowledgements
• Sincere thanks go to:
• Co-researcher Dr Aileen Hoath • the many interviewees who volunteered their stories and
experiences of LDC. • The Cities of Busselton and Mandurah and the many agencies
throughout Western Australia which assisted us with data and interviews
• Rio Tinto Iron-ore and Newmont Asia Pacific • The Commonwealth Department of Infrastructure and
Regional Development • Co-operative Research Centre - Remote Economic
Participation • Our research assistants, Berina Causevic and Luciano Pavez
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For further information:
Professor Fiona Haslam McKenzie (Curtin Graduate School of Business) [email protected] 0417 09 8880
Dr Aileen Hoath (Curtin Graduate School of Business) [email protected] 0439474269
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