1. Assessment and recommendations

The Pilbara is a vast region located in the northwest Western Australia that covers around 20% of the state of Western Australia, equivalent to Spain’s total land mass. With a residential population of around 58 000 people, the Pilbara is one of the least densely populated regions of the OECD and the world. The Pilbara’s population density (0.17 people per square kilometre) is even lower than the Northern Territory in Australia and in line with regions such as the Yukon, Canada, or Greenland, Denmark.

The Pilbara’s industrialisation dates back to the 1960s, when towns were established to accommodate the mining workforce, while First Nations people1 have inhabited the region for approximately 50 000 years (Webb, 2003[1]). The Pilbara is located on the traditional lands of approximately 25 First Nations language groups who have continuously practised their culture in the Pilbara region (Wangka Maya Pilbara Aboriginal Language Centre, 2020[2]). According to data from the 2021 Census, in the Pilbara, individuals identifying as Aboriginal and/or Torres Strait Islander constitute 12.9% of the population. East Pilbara has a notably higher proportion at 17.9%, compared to West Pilbara's 11.4%. These figures are above the 3.2% observed in Western Australia as a whole and the 2.9% nationwide in Australia2 (Australian Bureau of Statistics, 2021[3]).

Over the course of the 1950s and 1960s, the discovery of vast deposits of iron ore across the region and the repeal of a World War II export ban on iron ore by the Australian Government set the foundation for the industrial transformation and led the construction of the first towns (including the current four main cities in the region). While two of the ten towns initially built were eventually closed, others evolved from closed mining camps to open settlements. The industrialisation and the infrastructure development of this region was driven by extractive companies, which built roads, rail trains and utility infrastructure as part of agreements with the state of Western Australia (State Agreements).

The Pilbara is a leading global mining and energy producer, accounting for a major share of the global mining value production of iron ore and is home to important endowments of offshore petroleum (primarily natural gas), lithium, gold, copper, and nickel. These mineral assets have fuelled economic growth in the region (86.9% of total output in 2020 and 53% of the employed workforce) (REMPLAN, 2023[4]). The Pilbara’s mining resources are nationally and globally relevant:

  • Iron ore: 93% of Australia’s iron ore and 28% of global production are sourced from the Pilbara.

  • Lithium: The Pilbara hosts the fourth-biggest lithium mine in the world and the second- and third-largest lithium-producing mines in Australia.

  • Gold: The Pilbara is home to Western Australia’s third-largest gold-producing mine (Telfer).

  • Petroleum: 85% of Australia’s crude oil and 70% of Australia’s liquefied natural gas are sourced from the Pilbara.

Mining activities have not only driven the bulk of growth in the region but have also made significant contributions to the development of both the state and the country. The Pilbara accounts for 19.2% of Western Australia’s gross domestic product (GDP) and 3.4% of that of the whole country – approximately 15 times higher than its share of the national population (0.2%) (REMPLAN, 2023[4]). During 2012-20, the Pilbara’s economic growth rate (4%) was almost double that of the national average (2.2%) and was significantly higher than the OECD mining benchmark (3.0%)3. Mining activities have also created around 30 000 direct jobs (52% of the total in the region) over the same period. Other key economic figures in the Pilbara include:

  • Major exporter in the state accounting for 31.5% of total exports in Western Australia and 11.5% in the country in 2022.

  • A major provider of fiscal revenue for the state, generating 91% of royalties received by Western Australia (2021-22) and around one-quarter of the state’s total fiscal revenue (WA Government, 2022[5]).

  • One of the lowest unemployment rates in the country and OECD mining regions, at 1.8% (December 2022), one-third the average of OECD regions (4.9%) (OECD.stat, 2022[6]).

The security of employment and high-income opportunities have also attracted people to the region. The average population growth has been 1% over the last 10 years, higher than Western Australia’s average. In fact, in the 2016 census, nearly half the population had been living elsewhere in Australia five years prior.

The Pilbara region is witnessing an expansion in projects fuelled by green energy initiatives. Lithium, rare earths and green energy are offering extensive opportunities, while iron ore continues to be a foundational element of the region’s economy. In fact, the value of projected investments in 2022 from mining and energy projects over the next decade is equivalent to twice the value of regional GDP in 2021. Most of these investments respond to the sector’s need to adapt to the surge in global demand for minerals and the shift towards more environmentally conscious and digital mining practices.

The Pilbara has a number of assets that it can leverage to become a global leader in the green energy transition (Table 1.1). They include its competitive mining ecosystem, robust export infrastructure, proximity to Asian markets and renewable energy potential (solar, wind and hydrogen) to decarbonise mining operations and export low-emissions raw materials (green iron ore or green ammonia). The Pilbara has a strategic opportunity to reinforce its position as a key partner in supporting Asia’s efforts to reduce the overall carbon footprint of its production through a more environmentally sustainable supply of iron ore and critical minerals and a potential capacity to export green hydrogen.

In order to succeed, the Pilbara will also need to ensure better social outcomes, in addition to better environmental results, as these factors are increasingly important to both society and investors. To achieve this, greater participation of First Nations people in mining and energy initiatives, stronger commitments to preserve the environment and cultural heritage and to support thriving local communities must be at the core of policies. At the same time, the Pilbara should also look to diversify its economy by fostering entrepreneurship both within and outside of mining value chains, including tourism and leveraging First Nations know-how.

The Pilbara’s topology and remoteness to markets make it difficult to attract permanent residents. While the Pilbara region can offer a good lifestyle with a unique and spectacular natural environment and community lifestyle, harsh climate (prone to cyclones and high temperatures), remoteness from metropolitan areas and low population density act as disincentives for businesses and people to establish or remain in the region. The main population centre of the Pilbara, Karratha, is approximately 1 530 kilometres by road from Perth or a 2-hour flight and does not have any direct commercial flights from other Australian or international capital cities.

These factors are further complicated by a development model highly reliant on extractive activities (especially iron ore), which increases the vulnerability to economic volatility and the reliance on fly-in, fly-out (FIFO) workers. The volatility of the Pilbara’s economic growth (40%, measured as the average coefficient of deviation of GDP growth between 2008 and 2020) is 4 times the national average (10%). The region is one of the least diversified among 50 OECD mining regions. There are significantly fewer companies per capita in the Pilbara, with only 34 firms per 1 000 inhabitants, compared to the 82 per 1 000 seen in OECD mining regions. Furthermore, out of the 73 mining businesses operating in the Pilbara, only 31 are registered there and 24 of them report having no employees. Many companies in the Pilbara heavily rely on FIFO workers rather than establishing a more permanent, locally based workforce.

In this context, the Pilbara’s development model, heavily reliant on the mining sector, has fuelled a number of well-being challenges (Table 1.2)., including the highest cost of living in the state, acute socio-economic disparities between First Nations and non-First Nations populations and shortage of affordable housing, which in turn make it difficult to attract and retain workers for service provision such as childcare. In addition, greenhouse gas (GHG) emissions of the region are double the average value of 50 OECD mining regions.

Challenges such as high cost of living, a volatile housing market and limited options for secondary or higher-level education represent significant deterrents to longer-term residency. Despite population growth, the Pilbara faces an important turnover in its permanent population. Many work in the Pilbara temporarily due to favourable financial conditions but eventually move to areas with more amenities, including better education options or leave during economic downturns (REMPLAN, 2023[4]). Between 2001 and 2016, 68.5% of the Pilbara’s permanent population changed, meaning that over two-thirds of its residents either moved to or left the region during this period.

An important exception relates to the First Nations people of the Pilbara region, whose ancestors have lived in the region and managed its lands for millennia. For these people, their ancestral and contemporary ties to kinship and community, as well as their spiritual and cultural connections to the lands, waters and Sea Country of the Pilbara, render them a far more permanent, albeit on average, less prosperous component of the Pilbara residential population.

These challenges also stifle current and future growth opportunities in the Pilbara and can impede the region from becoming a global leader in the green energy transition. The way mining is carried out and its effects on the environment and people is increasingly at the centre of social movements and international investment strategies. Thus, addressing these challenges will contribute to the region’s well-being and help attract investment.

To mobilise the Pilbara’s assets and address its challenges, this study identifies four priority pillars for the Pilbara’s policy development:

  • Enhancing well-being and development opportunities of First Nations people, through First Nations co-designed reforms.

  • Improving access and provision of housing and services in the Pilbara.

  • Diversifying the economy inside and outside mining with a greater focus on green-related activities.

  • Establishing a coherent place-based strategy with a long-term vision for the Pilbara’s development.

First Nations people face substantial socio-economic disadvantages compared to non-First Nations Australians. In line with the national trend, First Nations people in the Pilbara have the highest unemployment rate, lowest median income, greatest deficits in access to basic services, worst health outcomes and higher rates of non-completion of secondary school. Improving the well-being standards of First Nations communities in the Pilbara will have overall benefits for the region, including a stronger labour market and possibilities of new business opportunities beyond mining.

In line with the principles of self-determination and “nothing about us without us”, any policy aimed at addressing historical well-being gaps of First Nations people requires providing clear opportunities for these communities to participate in the policy-making process. Improving the well-being of First Nations people in the Pilbara will require the empowerment of First Nations people to decide and manage resources from mining on their traditional lands and tailor education and entrepreneurship support:

  • The self-determination of First Nations people to manage resources from mining on their traditional lands should be strengthened. First Nations groups and mining companies have entered into arrangements that allow mining companies to access native title lands for the operation of mines in exchange for royalty payments that are made into trusts for which Prescribe Body Corporates (PBC) manage on behalf of native title holders. These substantial and growing funds have the potential to be mobilised to facilitate the economic empowerment of First Nations people. However, the current royalties system follows “mainstream” and top-down practices, making it difficult for First Nations people to navigate the system and hindering self-determination as it controls how and when communities spend their royalties (O’Fairceallaigh, 2017[8])).Thus, the federal and state governments together with First Nations leaders should examine alternative systems to manage native title royalties to enhance the self-determination and encourage enterprise and job creation.

  • Existing education models and capacity and training programmes need to be tailored to First Nations culture and development visions. New education models need to incorporate and align with traditional ways of transferring knowledge and skills to ensure First Nations youth have both the scholarly foundation and cultural connection to prosper as adults in the region.

  • Entrepreneurship and business growth models can be tailored to First Nations people. Building economies of scale and knowledge exchange spaces across First Nations’ business initiatives in the region and with other OECD First Nations groups will assist in sharing best practices, given the remoteness of communities across the region. Easing access to capital for First Nation businesses is also needed, as these communities find it difficult to access mainstream financial channels. Other OECD mining regions have supported First Nations entrepreneurship with First Nations-led associations or First Nations-owned local financial institutions funded by multiple sources (e.g. Canadian Council for Aboriginal Business). Immediate business opportunities include land management and conservation or involvement in renewable energy and circular economy projects.

Many people arrive in the Pilbara for employment opportunities rather than the lifestyle. Improving the attractiveness of the region requires better access to public services and more affordable housing.

More than quality infrastructure, labour supply is the main constraint to improving the quality of public services in the region. For employees working in the non-resource sector, the high cost of living, lack of affordable housing and isolation from metropolitan areas represent major bottlenecks to attracting services sector workers. Even after adjusting wages to higher living standards, there is a shortage of workers, especially for childcare, secondary and tertiary education and specialised health. Some Pilbara towns have in turn relied on FIFO workers to cover some specialised services as an immediate and short-term solution (e.g. healthcare specialists). This, however, is a less sustainable option for long-term local development.

Other remote OECD regions face similar challenges to improve service delivery. Several OECD studies have identified policy responses to address them. These include fostering collaboration among different levels of government for long-term investments and strategic planning, promoting economies of scale in service provision (e.g. through school networks) and implementing targeted attraction policies for public service workers (e.g. offering career incentives to attract rural teachers) (OECD, 2021[9]; OECD.stat, 2022[6]).

Unlike many remote regions across the OECD, the Pilbara stands out, given its significant wealth contribution to the state. Some of these resources could be reallocated to offer grants or other public incentives to compensate service workers for the region’s high living costs, particularly housing expenses. Beyond living costs, specificities of work in rural remote areas, such as small and multi-grade classroom teaching for teachers or feelings of isolation and long travel times, can also deter specialised service workers. To this end, non-financial incentives for service workers used in other OECD remote rural regions include more flexibility in roles for older staff, strong career and training incentives for newly qualified staff or greater use of part-time contracts (OECD.stat, 2022[6]).

The Pilbara faces a shortage of affordable housing. Prices have risen by 25% over 2015-21, with residential vacancies below 1% (PDC, 2022[10]). Critical to both mining companies and communities, this has been a long-standing barrier to improving liveability and economic opportunities locally, contributing to inequality in the region and reducing incentives for people and businesses to move into the area. Although the causes are multifaceted, they are rooted in the Pilbara’s high volatility, high construction costs and complex system of land tenure. These challenges are exacerbated by a reactive and siloed policy approach to dealing with housing issues (Table 1.3).

The nature of these challenges – managing a housing market in the midst of booms and busts – is also present in other remote OECD regions specialised in mining. Some of these OECD mining regions have created dedicated public funds to support affordable housing during bust periods (e.g. the local government of Thompson in Northern Manitoba, Canada) or created special task forces where different stakeholders join forces to develop strategic action plans and raise funds and awareness (Labrador West Housing and Homelessness Coalition of Labrador West, Canada).

Although regional communities have consistently advocated for measures to permanently locate workers in the regions, the FIFO working model has played an essential role in attracting and retaining a skilled and professional workforce from a larger pool of options in remote areas of operation and providing a buffer for governments to develop local community infrastructure during expansions or construction periods (Haslam McKenzie, 2020[12]). Despite these benefits, relying on high flows of FIFO workers brings major drawbacks, including pressures on the local cost of living, increased local inequalities, lack of social cohesion and deterioration of the mental health of FIFO workers.

The use of FIFO in the region needs to be planned and co-ordinated across levels of government to avoid pressures on the housing market and services. Some initiatives to help mitigate the negative impacts of a FIFO workforce locally include standardising models on how an effective FIFO camp is designed and operates and encouraging, where possible, better integration of FIFO accommodation within the Pilbara towns to help attain economies of scale for local businesses. These decisions need to involve communities early on, to attain common agreements with local governments and industry.

Economic diversification is essential to attain sustained and resilient growth in the Pilbara and reduce economic volatility. A strategy to advance economic diversification should be anchored on regional strengths, including its resource sector and co-developed with communities and First Nations people. The Pilbara needs to work with the region’s First Nations people to co-create an inclusive economic ecosystem that continues to attract international investments and unlock new growth opportunities inside and outside the mining and energy sector.

Inside the mining and energy sector, the region has the potential to:

  • Diversify its current mineral production by exploring ventures in critical minerals, leveraging its world-class mineral deposits with competitive deposits of at least four critical minerals (lithium, nickel, manganese and copper).

  • Leverage renewable energy sources to accelerate the decarbonisation of the mining process, incentivise downstream activities and create new opportunities for First Nations. The Pilbara has large solar and wind resources and extensive areas of undeveloped land. Most of the main mining companies in the region have set investment plans to increase renewable energy sources for mining production, which can help decarbonise the energy matrix of the region and create new employment. Moreover, the creation of the Pilbara Hydrogen Hub to fast-track renewable (green) hydrogen production and exports can help build the know-how and value chain to produce and export green hydrogen at scale via green ammonia. Working together with First Nations people can empower them to own stakes in these projects and ease access to land.

  • Create new businesses and attract new investments with circular mining practices. For example, mining waste in some operations can often reach well over double the amount of extracted ore, e.g. for each tonne of iron ore extracted, between 2 to 12 tonnes of overburden might be removed (Kinnunen and Kaksonen, 2019[13]; Mohanty et al., 2010[14]). However, creating a system that harnesses the benefits of the circular economy in mining requires facilitating partnership opportunities with small and medium-sized enterprises (SMEs) and research centres to put in place an appropriate value chain and technological development.

Outside the mining and energy sector, the region is well positioned to work with First Nations people and interested stakeholders to unlock: i) cultural and traditionally based business opportunities; ii) ecotourism and/or adventure-based businesses due to its environmental amenities; and iii) manufacturing, logistics and services that leverage the mining know-how and demand in the region. This requires actions to promote entrepreneurship in people already working in mining companies, such as in-company incubation, targeting entrepreneurship support programmes for women and First Nations people and improving infrastructure outside mining, particularly for tourism (e.g. accommodation and broadband).

The development of the Pilbara is mainly driven by the policies and strategies set by the Western Australia state. State departments are in charge of designing and implementing the main sectorial policies in the region, while local governments deliver a relatively narrow range of services, with all of their responsibilities defined by the state. Acting as a main link between state policies and local needs, the Pilbara’s Regional Development Commission (PDC) helps identify the region’s main development priorities and offers advice to regional businesses. The Pilbara has a range of development strategies that recognise the need to further diversify the economy and improve well-being.

Nevertheless, the region lacks a master plan or mechanism to co-ordinate actions across different state ministries for long-term strategies addressing pressing local priorities, such as housing affordability. Development plans are typically designed and delivered independently by each state department, following their respective sectorial scope, without common monitoring indicators to promote coherent implementation across departments. This lack of co-ordination is also evident at the local level, with little collaboration among strategic projects of local governments and with extractive companies’ environmental, social and corporate governance goals.

Moreover, the Pilbara’s policy-making process has been historically top-down driven, grounded in the region’s industrialisation development that relied on direct agreements between the state and private companies to secure the investments needed to activate natural resources in the region. This approach has resulted in a lack of a systematic approach to identify and integrate local initiatives in regional development policies and limited subsidiarity in governance, which hampers the capacity to sustainably address well-being and economic diversification challenges.

Attaining a more diversified and inclusive development in the Pilbara requires a coherent, long-term vision that unites efforts of different levels of government and regional stakeholders towards specific strategies that are tailored to the main well-being priorities in the region. A place-based policy can materialise this vision with a proactive approach to integrating regional actors in the policy-making process. This policy needs to be supported by a formal mechanism to co-ordinate different levels of government and regional stakeholders to monitor and implement strategic policies for the Pilbara’s development by strengthening accountability and better linking corporate social responsibility (CSR) strategies of extractive companies with government plans.


[3] Australian Bureau of Statistics (2021), East Pilbara 2021 Census Aboriginal and/or Torres Stait Islander people Quickstats, https://www.abs.gov.au/census/find-census-data/quickstats/2021/IQSLGA53220.

[15] Australian Institute of Health and Welfare (2023), Profile of First Nations people, https://www.aihw.gov.au/reports/australias-welfare/profile-of-indigenous-australians.

[17] Government of Western Australia WA Country Health Service (2022), Pilbara Health Profile, https://www.wacountry.health.wa.gov.au/~/media/WACHS/Documents/About-us/Publications/Health-profiles-and-service-plans/Pilbara-profile-2022.pdf.

[12] Haslam McKenzie, F. (2020), “Long distance commuting: A tool to mitigate the impacts of the resources industries boom and bust cycle?”, Land Use Policy, Vol. 93, p. 103932, https://doi.org/10.1016/j.landusepol.2019.03.045.

[7] Hurley, P., H. Matthews and S. Pennicuik (2022), Deserts and oases: How accessible is childcare?, Mitchell Institute, Victoria University, https://www.vu.edu.au/mitchell-institute/early-learning/childcare-deserts-oases-how-accessible-is-childcare-in-australia.

[13] Kinnunen, P. and A. Kaksonen (2019), “Towards circular economy in mining: Opportunities and bottlenecks for tailings valorization”, Journal of Cleaner Production, Vol. 228, pp. 153-160, https://doi.org/10.1016/j.jclepro.2019.04.171.

[14] Mohanty, M. et al. (2010), “Phytoremediation: A novel approach for utilization of iron-ore wastes”, Reviews of Environmental Contamination and Toxicology, Vol. 206, pp. 29-47, https://doi.org/10.1007/978-1-4419-6260-7_2.

[16] OECD (2023), OECD Toolkit to Measure Well-Being in Mining Regions, https://www.oecd.org/publications/toolkit-to-measure-well-being-in-mining-regions-5a740fe0-en.htm.

[9] OECD (2021), Regions and Cities - Western Australia - Population Density, OECD, Paris, https://regions-cities-atlas.oecd.org/metroregional/TL2/AUS/AU5/REGION_DEMOGR-POP_DEN-T/2019/x.

[6] OECD.stat (2022), Regional Economy (database), OECD, Paris, https://stats.oecd.org/Index.aspx?DataSetCode=REGION_ECONOM#.

[8] O’Fairceallaigh, C. (2017), Mining royalty payments, Griffith University.

[10] PDC (2022), Annual Report 2021-22, Pilbara Development Commission, https://www.pdc.wa.gov.au/Profiles/pdc/Assets/ClientData/Documents/PDC_Annual_Report_2012-2022.pdf.

[4] REMPLAN (2023), Economy Pilbara - Economy, Jobs and Business Insights, https://app.remplan.com.au/pilbararegion/economy/industries/output?state=Ma5RIx!A8AdIpG6gslRmA8TA9EM2tMtEhE1DFzxNx3cpjajOH1hNOi2h9SaaYAC8mB.

[18] REMPLAN (2022), Remplan Community, https://app.remplan.com.au/pilbararegion/community/work/employment?state=xNvJTe!BVepuZp58tay0k8tKkWbquJC2F5bVS3FgFZFdunFq7G (accessed on 30 March 2023).

[11] Townsend & Turner (2022), International Construction Market Survey: Australia and New Zealand.

[5] WA Government (2022), Western Australia Mineral and Petroleum Statistics Digest 2021-22, Government of Western Australia, http://www.dmp.wa.gov.au/Documents/About-Us-Careers/Stats_Digest_2021-22.pdf.

[2] Wangka Maya Pilbara Aboriginal Language Centre (2020), Aboriginal Languages of Australia, https://www.wangkamaya.org.au/pilbara-languages/01-indigenous-languages-of-australia.

[1] Webb, J. (2003), N212/N412 Global Environmental Issues - Pilbara Project.


← 1. Aboriginal and Torres Strait Islander (First Nations) people are the first peoples of Australia. They are not one group, but rather comprise hundreds of groups that have their own distinct set of languages, histories, and cultural traditions (Australian Institute of Health and Welfare, 2023[15]).

← 2. The share of First Nations people within the total population has been calculated by combining 2021 Census data from East and West Pilbara (Australian Bureau of Statistics, 2021[3]). Based on the place of usual residence, this serves as the most updated and closest approximation to identify the number of First Nations individuals in the region.

← 3. The OECD Toolkit to Measure Well-Being in Mining Regions (OECD, 2023[16]) identifies 50 OECD mining regions with a high specialisation in mining activity relative to their respective countries to better benchmark well-being trends relative to other OECD regions, as well as challenges and strengths.

Metadata, Legal and Rights

This document, as well as any data and map included herein, are without prejudice to the status of or sovereignty over any territory, to the delimitation of international frontiers and boundaries and to the name of any territory, city or area. Extracts from publications may be subject to additional disclaimers, which are set out in the complete version of the publication, available at the link provided.

© OECD 2023

The use of this work, whether digital or print, is governed by the Terms and Conditions to be found at https://www.oecd.org/termsandconditions.