In 2004, the copper-mining industry in Chile advanced $5 billion in operational expenditures, of which $1.3 billion went to acquiring goods and inputs, and $1.7 billion to nonstrategic services.⁴ As industrialization in East Asia advanced in tandem with international demand for raw materials, mining companies became increasingly reliant on contractors. By 2013, mining corporations were allocating 60 percent of their operational costs for the acquisition of goods and services from third parties.⁵ Aside from being a relatively new sector in the Chilean economy, the contracting industry for mining has also become very dynamic. In 2010, there were 4,643 registered contractors, while in 2012 the figure rose to 5,998, which means that in only two years the sector grew by 29 percent.⁶ Besides its dynamism, the sheer size of the sector attests to the increasing relevance of contractors for the mining industry as a whole. In 2012, the sector accounted for 7.4 percent of Chile’s GDP, while the mining industry as a whole accounted for 12 percent.⁷ As of 2012, contractors employed 712,697 laborers under direct working contract, equivalent to 10 percent of Chile’s working population.⁸

The tasks initially outsourced in the mining industry were labor-intensive and marginal to the core operation, such as catering, hostels, and shaft sinking, but gradually began to include more complex services, such as mineral forecasting, geological modeling, and engineering. The trend toward a larger degree of diversification in services provided seems to have taken off in the South African mining industry during the 1990s, when whole shafts began to be outsourced to third parties.⁹ In Chile, this trend has evolved to the extent that large transnational corporations now figure among the key actors in the contracting sector for mining. Komatsu, Siemens, and Finning Cat are among the companies that commonly operate alongside extractive corporations in shafts, pits, and industrial facilities for mineral processing.¹⁰ The distribution of the services outsourced to contractors illustrates the evolving technical composition of labor in the extractive industries. Labor-intensive tasks such as transport, catering, and security constitute the largest percentage of services provided. The more complex, capital-intensive tasks, such as construction, mechanical engineering, industrial and electrical equipment, drilling, mineral crushing, explosives, and lab analysis, account for only 9 percent of outsourced services (see figure 1).

These figures reveal a trend that is not particular to the mining industry but symptomatic of an overall shift in global labor organization, where the tendency toward automation unfolds alongside internal polarization between the various organs of the collective laborer in accordance with their productive attributes. High-skill services such as engineering, consultancy, and lab analysis are contingent upon the expansion of the productive capacities of a segment of the workforce, so the core operations of the mine tend to be carried out by a clique of well-remunerated and skilled wage-laborers. As mines tend to be geographically remote from cities, this “privileged” organ of the collective laborer is, almost without exception, composed of city dwellers with specialized academic training and no connection with the sites of extraction. As an official of Codelco remarked,

The new generations of engineers and technicians do not want to spend 12 hours a day stuck in the dirty, gruesome environment of a mining shaft or pit. They are “technological by nature,” and so they prefer to operate the mine from remote locations, using joysticks and digital platforms.¹¹

The more specialized the worker, the farther away she generally lives from the extraction site. The most qualified engineers usually live in Santiago or other Latin American capitals and commute to extraction sites when required.

When these engineers visit the sites, Merchant notes, they stay in “lavish base camps” akin to “a tiny five-star hotel with ten or so rooms and a private chef plunked down in the weird alien desert.”¹² The wealthy and extravagant lifestyles of mining engineers are perhaps nothing particularly specific to the twenty-first century. As Gray Brechin shows, the profession of mining engineering acquired a heroic, almost evangelical stature following the wave of technological innovation and mechanization tied to the introduction of the internal-combustion engine in the late nineteenth century.¹³ The mining engineer of earlier phases of mechanization, according to Brechin, was “tough yet refined, moving as easily amid the smelters of South Africa’s Rand and Butte … as in the palaces and bourses of the European capitals or the New York Stock Exchange.”¹⁴ For an ambitious young man in that day and age, Brechin considers, “a mining career offered the chance to win the wealth capable of propelling him into the same Olympian caste as the men and women for whom he worked.”¹⁵

Santiago de Chile, in particular, has become one of the most attractive cities in Latin America for the highly skilled workers, financiers, and executive personnel of the mining industry. Many transnational firms and contractors have settled in this bustling, modern city. According to De Mattos, the factors that have made Santiago an attractive hub for transnational corporate networks are its communications/transport infrastructures, its physical proximity to other firms, the availability of a wide array of production services, its highly diverse and qualified labor markets, and relatively diversified industrial base.¹⁶ As a result of the urban modernization that followed Chile’s neoliberal transformations after the 1970s, De Mattos explains, Santiago became increasingly positioned as an organizational hub for global economic operations, similar to other “global cities.”¹⁷ According to Riffo Pérez, Santiago is where the firms and economic groups that plan, coordinate, and control Chile’s export-oriented sectors have established their head-quarters.¹⁸ Perhaps mirroring the growing outsourcing of services and tasks in the mining industry, the service sector that has displayed the fastest growth rates in Santiago. In general terms, it has been argued that Santiago’s introduction to transnational corporate networks has upgraded the technical composition of the local workforce.¹⁹ Not surprisingly, then 62 per cent of the mining industry contractors are based in Santiago.²⁰