Resources Minister Martin Ferguson has told miners the Government is sympathetic to their concerns about the cost of doing business in Australia.
Addressing the Minerals Council of Australia conference in Canberra, Mr Ferguson said global trade across several commodities would continue to grow in the next five years.
Mr Ferguson said Australia was a high-wage economy, and improving efficiency of labour, plants and equipment would be crucial to keep up with the demand.
"But we cannot afford to believe that things will just naturally work out for the Australian economy," Mr Ferguson said.
There were significant growing cost pressures across the whole mining industry from iron ore to gold.
"The Government appreciates the mining industry's concerns about the rising costs of doing business in Australia."
Productivity increases within the sector were necessary, as was the Government's regulation of it and in the sections of the economy that support the industry, Mr Ferguson said.
Meeting the challenge of the skills shortage was a crucial challenge for the industry.
"Chief among them is the need for more skilled workers to meet expected demand," Mr Ferguson said.
Mining operations would need an extra 89,000 workers in the five years until 2016 to meet expected construction of new projects and production.
The Government's national resources sector workforce strategy was tackling the issue head on with industry and State governments to undertake workforce planning and to train more tradespeople and graduates, he said.
But the Government recognised the Australian labour market would not always be able to meet peak workforce demands, resulting in the fast-tracking of processing applications for 457 visas and the introduction of enterprise migration agreements.
The announcement last week by the Federal Government that more than 1700 foreign workers could be brought in under an EMA for Gina Rinehart's Roy Hill iron ore project in the Pilbara has sparked controversy.
But Mr Ferguson said the arrangement would ensure skills shortages did not create constraints on major projects or jeopardise Australian jobs.