Biden's 'Green Jobs' Mirage
President Biden finished his whirlwind first week in office with an executive order to tackle climate change. A core part of this strategy relies on training new and incumbent workers, especially those in existing high-carbon jobs like fossil fuels, for new “green” occupations. John Kerry, Biden’s White House lead on climate change, was explicit: Many of those currently working in the energy sector could and should be retrained to install solar panels. Leaving aside the merits of policies designed to slow the accumulation of greenhouse gases and rising global temperatures, the new administration’s emphasis on green jobs as a major contributor to employment and an economically viable alternative for workers in the legacy energy industry is likely a mistake.
The Obama Administration made a similar push for green jobs and a greener economy. In fact, the U.S. Department of Labor (DOL) put millions of grant dollars in the hands of community colleges and other training programs to prepare workers for wind, solar, and other green jobs. There were high-profile green failures like the $528 million federal taxpayer loss on Solyndra, but evidence also demonstrates that wind and solar training programs fell woefully short of providing high-paying and sustainable employment that might be seen as reasonable replacements for other energy-intensive industries and occupations.
A 2018 report by the Environmental Defense Fund suggested there were 777,000 jobs in renewable energy and according to 2019’s U.S. Energy Employment Report (USEER), around 600,000 people worked in zero emissions technology. This is a vanishingly small portion of the 150-million-stong American workforce. Green industries and occupations are unlikely to be able absorb large numbers of new and retrained workers anytime soon, and public subsidies for training won’t solve that problem. While green employment did increase during the Obama Administration, that had a lot to do with the cost of solar and wind coming down and virtually nothing to do with federal job training subsidies.
Wage levels in green occupations are another problem. Pipeline and other traditional energy workers impacted by Biden’s closure of energy development projects on federal lands and his order stopping construction of the Keystone XL pipeline, would likely have a hard time finding an equivalent wage in wind and solar jobs. A rigorous study issued in 2017 by the DOL demonstrated that training in wind and solar did improve earnings, but the annualized salary was only $18,460, far below what welders, pipefitters, and other fossil fuel energy sector workers earn. Reskilling is also a significant challenge as workers attempt to move from one type of work to new forms, like solar installation, that often require time-consuming training and licensing requirements.
These misalignments are often especially acute in green jobs proposals that seek to satisfy multiple but not necessarily compatible objectives simultaneously: employment, energy conservation/alternative energy production, and environmental policy demands. One of us worked on a federally-funded green jobs project in California focused on upskilling electricians to install advanced lighting controls (commercial outdoor lighting accounts for 40 percent of California’s electrical consumption). This project enjoyed modest success but only because trainees were already highly skilled, licensed electricians and because the state had imposed strict mandates on electrical utilities to reduce carbon emissions and on businesses to deploy advanced lighting technology.
The kind of climate policy backstops required to make green employment really work have never gotten much traction at the federal level and are unlikely to do so now in a closely divided Congress. Without them, labor market demand will be insufficient to generate enough jobs for newly trained workers. From an employment standpoint, this amounts pushing on a thread which is a recipe for disappointment and frustration among workers who already feel left out and left behind.
The final problem with Biden’s green jobs plan is that it doesn’t meet the moment and address the biggest issues of the day. Due to the COVID pandemic and recession, the two biggest short-term challenges we face are rapid worker training and upskilling and reemployment. Restarting the economy and helping workers through a dramatically altered and uncertain employment market should be at the top of our list of policy priorities rather than taking the back seat to long-term environmental policy.
To meet these challenges, the federal government should be focusing on how to empower workers, states, and the publicly-funded workforce system through policies like Personal Reemployment Accounts, the redesign and reinvigoration of American Job Centers (AJCs) that can help smooth worker paths back, and better integration of training and support systems to ease the return to work. By prioritizing green workforce as job creation, President Biden risks misallocating limited political and fiscal capital, while leaving American workers without the supports they urgently need to care for themselves and their families.
Brent Orrell is a resident fellow at the American Enterprise Institute. Mason M. Bishop is a visiting fellow at AEI and the owner and principal at WorkED Consulting LLC.