Biden’s Climate Plan & The Energy Workforce

With former Vice President Joe Biden’s campaign releasing an updated energy and environment plan today, I wanted to circulate a brief energy primer addressing some increasingly common misnomers about America’s energy workforce.

Since Biden has directly highlighted the anticipated role of his climate plan in pulling the U.S. out of the current economic downturn, it’s become especially important to scrutinize the plan’s underlying economic assumptions about job creation, and associated job quality. The former Vice President regularly asserted that his previous plan would create 10 million, good paying, union jobs even though The New York Times noted during last year’s primary elections that the candidates’ climate plan job-creation claims were “rosy” and “vague.”

• Myth 1: Plans that mandate a transition to renewable energy will create jobs that pay as well as the union jobs that will be lost. The Facts 
• Myth 2: Americans who lose their job in the natural gas and oil industry can easily transition to a new job working in renewable energy. The Facts 

“We stand at a crossroads for the nation’s energy future, and the choices policymakers make in 2020 and beyond will determine whether we build on America’s energy progress or shift to foreign energy sources with lower environmental standards. You can’t address the risks of climate change without America’s natural gas and oil industry, which continues to lead the world in emissions reductions while delivering affordable, reliable and cleaner energy to all Americans.

We will continue to work with members of both parties to advance real solutions to climate change that build on American energy leadership and protect the good-paying union jobs our industry supports in states like Ohio and Pennsylvania and across the country.” – API President and CEO Mike Sommers

MYTH: Plans that mandate a transition to renewable energy will create jobs that pay as well as the union jobs that will be lost

THE FACTS

Bloomberg Law reports that a “shift to renewable energy is a move away from an industry with union jobs.” (Bloomberg Law, 2/21/19)

• According to Vox, many renewable energy companies are led by individuals “hostile” to union activity and the industry relies on labor practices that “hamper organizing.” (Vox, 7/19/19)
• 3.4% of solar photovoltaic workers are unionized while 4% of workers in wind power generation were unionized.  (“U.S. Energy and Employment Report,” Department of Energy, 1/2017)
• President of the North America’s Building Trades Unions:“Members working in the oil and gas sector can make a middle-class living, whereas renewable energy firms have been less generous.”(Reuters, 2/12/19)
• AFL-CIO President: “[P]lans that devastate communities today, while offering vague promises about the future…are not worthy of the American heroes who build and power this country every day.” (AFL-CIO, 7/24/19)
• President of the International Brotherhood of Boilermakers: “Workers who have completed an apprentice program or otherwise dedicated years of their lives in a craft don’t want to see their skill sets devalued or be thrown into junior positions in a new occupation.” (International Brotherhood of Boilermakers, 3/7/19)

The average annual pay for natural gas and oil extraction workers is $96,600 (BLS, 5/19)

The average annual pay for solar photovoltaic installers is $46,850. (BLS, 5/19)

The average annual pay for wind turbine service technicians is $56,700. (BLS, 5/19)

MYTH: Americans who lose their job in the natural gas and oil industry can easily transition to a new job working in renewable energy

THE FACTS

As workers in any industry that has lost jobs know, a steep drop in employment within one’s industry can have a devastating impact even if someone is able to eventually find employment in a different field. But beyond any emotional and psychological toll, creating a federal retraining program won’t guarantee workers a successful transition:

• The Atlantic: “[M]ost [job-retraining programs] have been found to be ineffective according to numerous studies over the years.” (The Atlantic, 1/8/18)
• Columbia University’s Center on Global Energy Policy: “Despite promises from the federal government for a quarter century to provide worker retraining, education, and other support to help communities displaced by globalization and displacement, both parties have failed to fulfill those promises.” (Columbia’s Center on Global Energy Policy, 3/25/19)

And according to a report titled ‘Jobs and Environmental Regulation’ by Resources for The Future, an environmental research institution:

• A transitional “worker who loses his job won’t immediately find a new job at the same wage, but instead will likely spend a significant amount of time searching for work, and might well need to accept a lower wage in the new job.” (“Jobs and Environmental Regulation,” Resources For The Future, 7/2019, p.9)
• “[W]orkers who lose their jobs in mass-layoff events suffer not just a spell of unemployment, but also have persistently lower earnings for a long period even after finding a new job.” (“Jobs and Environmental Regulation,” Resources For The Future, 7/2019, p.1)
• One case study cited found that older workers were disproportionately subjected to a decrease in wages following a regulation-induced job transition. (“Jobs and Environmental Regulation,” Resources For The Future, 7/2019, p.15)
• Unemployed transitional workers “are much less likely than the average unemployed worker to find jobs in the period immediately after implementation of a new regulation.” (“Jobs and Environmental Regulation,” Resources For The Future, 7/2019, p.41)
• Accommodating transitional workers back into the labor market “becomes more and more difficult as the amount of [transitional workers] grows.” (“Jobs and Environmental Regulation,” Resources For The Future, 7/2019, p.43)
• Workers may need to relocate to find a new job, especially in areas with a high concentration of unemployed transitional workers, which creates additional financial barriers to gaining employment. (“Jobs and Environmental Regulation,” Resources For The Future, 7/2019, p. 6)
  • Urban Institute: A mismatch of where jobs and job seekers are located leads to “spatial mismatch” and that can “cause high unemployment rates and lead to longer spells of joblessness.” (“Too Far from Jobs: Spatial Mismatch and Hourly Workers,” Urban Institute, 2/21/19)
  • National Bureau Of Economic Research: “Blacks, females, and older workers are more sensitive to [spatial mismatch] than other subpopulations.” (“Job Displacement and the Duration of Joblessness: The Role of Spatial Mismatch,” National Bureau Of Economic Research, 4/2014)