A new report is challenging the notion that the transition to renewable energy will provide sufficient employment opportunities for oil and natural gas workers.
The report, commissioned the American Petroleum Institute and the North America’s Building Trades Unions and performed by data firm Cicero Group, analyzes the assumption that America’s oil and natural gas (ONG) workers can realistically transition to renewable energy occupations given job requirements, quality, and availability. The report finds that there are numerous challenges that policymakers fail to understand and address when making the claim that the energy transition means a just job transition, explaining:
“Transferability is a function of job requirements, quality, and availability. Analyzing these factors shows that ONG workers face considerable challenges transferring from ONG occupations to Clean Energy occupations.
“These findings urge interpreting with caution any policy positions that frame transferability from ONG to Clean Energy as straight forward or easy. They also suggest a more data-driven, nuanced approach to policies that will impact occupation transferability so that American workers are not shortsightedly disadvantaged.”
In fact, only two of the 18 positions analyzed showed reasonable transferability potential. As API’s Frank Macchiarola explains:
“The reality is that transferring workers to the renewable energy sector from careers in oil and natural gas – where non-retail, direct industry jobs pay 80 percent more than the average job in the U.S., according to Bureau of Labor Statistics data – is fraught with challenges. These make the notion of job transferability more aspirational than feasible and economically untenable for millions of American families.”
A Matter of Scale
The analysis compared a list of the most prevalent occupations for the ONG industry with the most in-demand occupations in renewable energy and the below image shows the transferability of those jobs from the former to the latter.
The striking analysis of jobs listed shows a scale that the renewable energy occupations have failed to meet. The rate of employment in technical trade occupations to these jobs would have to explode to absorb half of the corresponding ONG positions. From the report:
“From a job demand perspective, an industry-level analysis of data shows that the most prevalent ONG occupations employ 10x as many workers as there are average annual job postings for the most in-demand Clean Energy occupations.”
What Determines Transferability
The report notes that transferability within occupation type between technical-trade occupations is inherently more feasible, but management-professional, and sales occupations are more difficult due to differences in job requirements between the two industries.
And while policymakers are fond of making broad statements that the technical trade employees can readily transition to renewable energy jobs, they fail to consider how skills, education, pay, location, and job demand impacts job transferability.
These factors result in significant challenges in transitioning ONG workers to renewable energy within a given occupation type – there may not be jobs that workers can transition to within their state or community with comparable pay and a corresponding skillset.
In some cases, ONG employees may be overqualified for renewable energy jobs. The skills gained in the oil patch train workers for complex work, continual maintenance, and constantly upgrading technology used in oil and natural gas production as opposed to the less complex and straightforward building projects in the renewable energy sector.
This report shows that the transferability to ONG jobs to renewable energy is far from a one-to-one transition and leaves out a lot of requirements in the respective sectors and personal circumstance of the workers. As Macchiarola said:
“We should increase American oil and natural gas jobs, not transfer them to other sectors. Doing so could force workers, who’ve made good oil and natural gas industry careers for themselves and their families, to walk away from education and specialized skillsets for work elsewhere that doesn’t necessarily align with their experiences or preferences.
“The millions of skilled workers who produce and deliver American energy are essential to the U.S. economy, helping American families keep their lights on and heat their homes while driving innovation to advance a lower-carbon future.”
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