Wesdome Gold Resources Ltd.'s third-quarter loss increased as challenging ground conditions and difficulties attracting skilled development miners cut gold production, the Toronto-based company said Monday.

In the quarter ended Sept. 30, Wesdome lost $1.62 million, or one cent per share, compared to a loss in the year-earlier quarter of $118,000 or breakeven per share, said Wesdome, which owns the Eagle River mine in Ontario and the Kiena mine in Quebec.

Revenue slipped to $19.62 million from $20.76 million.

The Toronto-based company said it produced 10,337 ounces in the last quarter compared to 15,131 ounces in the 2010 third quarter.

Wesdome's Kiena mine suffered lower production caused by severe dilution and lost ore caused by ground control challenges encountered in the first and second quarters.

These unfavorable circumstances were exacerbated by a retarded development advance due to labor issues related to the very tight labor market causing high turnover, the company said in a statement.

Development of our larger, future production areas is proceeding more slowly than anticipated. Both mining operations are in major development cycles to bring on the next generation of production areas.  It is difficult to attract and retain skilled and experienced development miners under present industry conditions.