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U.S. compliance sector strong in 2012

September 11, 2012 Leave a comment
business chart showing success

U.S. compliance sector showing strong performance in 2012 (Photo credit: s_falkow)

The annual conference of the American Cultural Resources Association (ACRA) was held a few days ago in Seattle, Washington. ACRA is the trade association for the heritage compliance sector in the United States. While the ACRA program is filled with valuable business topics, the real benefit of attending is gained from talking with company owners and senior employees in the hallways and at the many social events. People often say things about their businesses that they probably shouldn’t and one always comes away from the meeting with a wealth of information about competitors and the compliance sector as a whole.

My back hallway sample, probably representative although not statistical, indicated that the compliance sector in the United States is strong. Most companies reported that 2012 has been a good year for business, with more than a few companies reporting that this year will be their strongest year since the recession of 2008/2009–some reporting their best year ever. Strength is primarily coming from activity in the mining, electrical transmission, alternative energy, and oil/gas client sectors. This pattern of strong performance appears to be geographically uniform, although there are some areas of the country doing better than others due to geographical factors (e.g. locations of oil fields and mineral resources). There are, however, a few gaps in the compliance sector’s overall strong business performance. A few firms reported that they are still having difficult times and have yet to really rebound from the recession four years ago. What is interesting about this is that a few of these firms are well known firms that have been market-share leaders in the past.

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Is Western Australia’s heritage compliance boom suddenly over?

September 2, 2012 1 comment

To Boom or not to boom, that is the question.

Australia’s Resources and Energy Minister Martin Ferguson declared on 23 August 2012 that the country’s mining boom was over. This was one day after the world’s biggest miner BHP Billiton shelved two expansion plans – the Olypmic Dam open cut mine expansion in South Australia and the Port Hedland outer harbour expansion in Western Australia’s Pilbara region – each project valued at around $320 billion.

Archaeological salvage excavation at an iron mine site in the Pilbara (Photo: Guadalupe Cincunegui, ACHM).

These statements prompted some immediate flak from the mining and resources sector, while the Western Australian Premier Colin Barnett repeated his mantra that there never was a “boom”, it was just that his State has a healthy, expanding economy!Minister Ferguson and other senior Labor Government figures rapidly clarified his statement, saying that he was referring to the commodities boom being over, particularly with the international iron ore and coal prices dropping, while tens of billions of dollars in ongoing mining and energy development projects in Australia would continue on track.This is the point at which Australian heritage consultants could stop holding their breath and quaking every time they looked at a media financial report for more news of impending doom.

Heritage consulting in Australia is predominantly tied up with mining and energy developments and regional infrastructure development projects – which in turn are responses to growth through mining and energy developments. Minister Ferguson’s original announcement, coupled with BHP Billiton’s announcement and the resulting media blitz caused considerable angst among consulting firms still taking on new staff to push for bigger shares of mining-related heritage survey and impact-mitigation work – and for the growing numbers of local archaeology and anthropology graduates, as well as international ones on holiday-working visas, who are looking for work in the industry.

There has been some drop in available project work – cancellation of the BHP Billiton projects and some slowdowns in other companies’ projects due to credit and cost recalculations in the face of lower commodity prices. This has hit Queensland’s coal industry, though coal-seam gas projects so far seem unaffected. Overall though, everyone still seems to be maintaining their work flow on current projects. However, heritage services for development projects represent a finite block of work, and to maintain momentum, heritage consultancies need a constant flow of new projects. So while there appears to be enough work at the moment, we will still be all watching China in particular and the financial news in general, to see if the past continues to have a commercial future in Australia.

Australia’s “export resources” boom leads the economy and supports heritage consulting

Perth Airport’s plan for the $500 million upgrade that will integrate international and domestic terminals and provide for the rapidly expanding FIFO requirements of the Pilbara mining industry (photo credit Australian Business Traveller)

The Chamber of Minerals and Energy of Western Australia (CME) described the Australian domestic outlook as “cautiously optimistic”in its quarterly WA Resources and Economics Report (with KPMG) in March 2012. The export resources sector, which is providing a sustained boom for the heritage consulting segment, still leads the national economy.

Western Australia continues to benefit from the surging resources sector. The March 2012 ABS Investment Survey shows that resource investment has grown to be larger than investment in all other Australian business sectors combined. According to the survey, 86 per cent of this investment goes to Western Australia and Queensland, and there could be a further 62 per cent increase in total resource sector investment in 2012/13.

The report also noted that the high level of investment is maintaining record levels of employment in Western Australia, with February 2012 unemployment for the State at four percent, and forecast to remain this low for the next few years.

The Western Australian resources industry supports heritage industry employment (archaeologists, anthropologists, GIS specialists, etc) not just in Western Australia, but throughout the country. Most of the mining and energy project development is in remote areas such as the Pilbara and mid-north regions, so that heritage consultants join the flood of fly in-fly out (FIFO) workers for these projects from around the country. Most heritage consulting firms engaged in heritage survey and management work in this sector source both permanent and casual staff from around the country, who fly in via Perth to regional airports around the country, sometimes followed by hours of four-wheel-drive travel to reach the work sites. Read more…

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