21/01/2009 - 22:00

Gold shows its timeless value to Kalgoorlie

21/01/2009 - 22:00

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THE Goldfields could once again become an accurate descriptor of the region around Kalgoorlie after the returns from the gold mining industry helped the area cope with a recent slump in nickel mining.

THE Goldfields could once again become an accurate descriptor of the region around Kalgoorlie after the returns from the gold mining industry helped the area cope with a recent slump in nickel mining.

This marks a reversal of the region's growth pattern over the past decade, with nickel and other commodities having become more important than its historical mainstay.

But plummeting nickel prices have caused a number of mines to halt production or delay expansions, such as Mincor's Miitel in Kambalda, Consolidated Minerals' Kambalda nickel operations, Russian miner Norilsk's Waterloo mine in Leinster, OZ Minerals' Scuddles mine, and BHP Billiton's Mt Keith mine in Wiluna.

Despite the closures resulting in the loss of about 400 jobs, spending in Kalgoorlie remained steady over Christmas and, in some cases, was better than the previous year.

City of Kalgoorlie-Boulder executive officer Don Burnett said the faltering fates of nickel had not severely affected the town because of the strong presence of gold.

"Bearing in mind Kalgoorlie was founded on gold, so although there have been some mine closures in nickel, gold stayed strong," he said.

"My impression is that some of the people who were losing jobs in nickel were being taken up in the gold sector and the general services industry."

Integrated Personnel general manager mining resources, Craig Hudson, said the company had initially been involved in helping to relocate workers, but many of those workers had been offered employment by gold produces.

Sentiment among retailers was that trade was steady and, in some cases, relatively good.

Toyworld acting manager Gabe Cullinan said the nickel layoffs were apparent but they had not affected sales.

"There have been a few layoffs. People are losing their jobs, and not just in the mines but in industries related to the mines," he said.

Despite this, trade was not any slower, equalling last year's sales figures, according to Mr Cullinan.

"No matter what happens, people still spend their money on toys at Christmas," he said.

"In November we were a bit slower but in December business just boomed. I think that was because of the $1,000 grant the government gave to parents."

Star City Memorabilia owner Nigel Quick said Christmas had been a very good trading period, but it was hard to compare figures to last year because the store had expanded.

"It's been steady as she goes," he said.

"A lot of people in town are losing their jobs but they go into another one straight away.

"A lot of the jobs are high-end. Lots of jobs in the mining industry are highly skilled, so if they let workers go, someone's going to pick them [the workers] up straight away."

Mr Quick said that, before the nickel slump, there was a shortage of workers at other mines and associated industries.

"It hasn't affected us in retail, unless it's yet to come, but so far so good," he said.

At Sheedy's Jewellery store, gold's good fortune has been a double-edged sword. Although many customers are turning from shares to gold, the mineral's strong value against a weakening dollar is driving up stock prices.

Owner Tony Pepper said sales figures were on a par with last year.

He said most workers who had been laid off had walked into new jobs within three weeks.

"There are that many skilled jobs up here. Generally it's a different type of mining, they're going from nickel to gold," Mr Pepper said.

He said the mood around town was positive despite recent closures.

"In a town like Kalgoorlie, where the average income is $150,000, it's not going to be such a big deal," he said.

Mr Pepper said there had been an increase in customers wanting to invest in gold.

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