The United States economy is extremely large and diverse – over 128 million people employed with a gross domestic product (GDP) of almost 20 trillion dollars.  As discussed in previous articles, historically all economic growth has been supported by an increase in energy usage.  Even before the focus on carbon and renewables, the relative increase in energy vs. GDP has slowed.  In recent years, the US economy has been able to grow without an increase in total energy usage.  This lack of demand growth is being offset, on the employment side, by the rapid transition from fossil fuels to renewable energy.  This transition is adding manufacturing and construction jobs in the renewable energy sector and these positions will continue to be needed until this buildout is completed.  In the US Power Generation Sector there are about 1.8 million full time jobs.  The key question is how will total employment be impacted by this transition and certainly how will the job types change during this transition?

As with most topics in the energy sector, the answers are complex and require looking into the details to really understand the issues.  With the transition to more renewable energy, there are several factors that must be considered:

1. Current renewable generation sources (wind and solar) eliminate the need for fuel supply, thus eliminating those jobs. 
2. Building new facilities requires more manufacturing and construction vs. operations & maintenance.
3. Solar and wind technology are deploying in much smaller and more complete modules, so manufacturing is a large portion of the costs vs. on-site construction.  Manufacturing can be worldwide vs. nationwide.
4. Solar and wind facilities require less on-site operations and maintenance personnel.
5. The ownership and size of renewable energy facilities is and will continue to change the type, location and function of many of the existing roles in the electricity generation sector.

This article is focused on the labor associated with electricity generation and has applied only portion of the labor in the fuel supply sector for natural gas and oil, as these sectors have many more uses that are not directly related to electricity generation. 

To best frame this analysis, the total employment in each category of generation is shown relative to the percentage of total US electricity generation in 2018.  For the Storage and Transmission & Distribution (T&D) sectors, there is no comparable generation, but these are shown as they will be major employment sectors no matter the fuel mix.  The largest total and utility employer is the T&D segment, with the growth in the number of generation sites and expected increased reliance on electrification this is expected to grow. 

The largest generation sources remain coal and natural gas, which together provide 63 percent of electricity generation.  As mentioned above, these sources have a significant number of fuel extraction and transportation jobs, but even with those positions, these sectors only contribute 29 percent of the jobs. 

As widely reported, employment in the fast-growing wind and solar segment is large and is continuing to grow.  Their total employment is currently not proportional to their relative generation with 9% of the electricity generation and 20% of the employment.  This is as expected since renewables are were 35 percent of the US new generation capacity added in 2018 and most of these jobs (>60%) are in the construction and manufacturing areas. 

This transition from on-going operating positions directly in the power generation and fuel extraction & transport to more construction and manufacturing positions will be a significant challenge for the US labor market.  Of course, construction will be US based, but how much of the manufacturing will be in the US or located overseas?  Also can those existing workers transition their skills and be willing to move to meet these new needs?

Over the next several decades as the installation of new renewable facilities continues, the growth in the construction and manufacturing employment will continue to increase.  The longer-term question is that once the buildout is complete, what will be the level of employment to support this new fuel mix, or lack of it, in the electrical generation segment? 

The factors mentioned in the beginning of this article are expected to skew this long-term employment picture since the renewable segments are working from a small installed base and growing rapidly.  Even with this caveat, the total employment from the renewable sector should support a similar sized employment base.  There will be significant issues around the types of positions that these facilities provide vs. the large number of centralized employees at centralized fossil and nuclear plants.  The long-term employment position mix maybe more like traditional hydro plants than the fossil fuel facilities that dominate electrical generation today.  Certainly, the increase in electrification and number of electrical generation sites will provide more demand for utility positions in the T&D and Storage sectors which will offset some of the employment type transitions.

This article is based on Continuum Energy’s analysis of data from “The 2019 U.S. Energy & Employment Report” produced the National Association of State Energy Officials and the Energy Futures Initiative.  US electrical generation data is from the US DOE’s Energy Information Agency.