Future Challenges

There are many challenges that could impact future green job growth. Some analysts worry that not enough workers are being trained for new green jobs being created, which could slow economic growth. Others worry that the green job boom is too dependent on government funding, which could dwindle if the public comes to view the return on investment as too small.

Watch Videos of Experts Discussing the Green Economy

Talent Shortage

With an estimated 10 million Americans laid off during the recession so far 1, and plenty of competition for green jobs today 2, it's hard to imagine a talent shortage in green industries. But some sectors are preparing for just that 3. The Pew Charitable Trusts estimated green job growth outpaced overall job growth by two and a half times, increasing 9.1 percent between 1998 and 2007 4. Because of stimulus package and other government funding – as well as public concern about climate change and energy security – many industry watchers expect these industries to continue to grow, creating thousands of new jobs that didn't exist before 5. (Check out lists of hot new jobs here [please link to the list at the bottom of this page].)

Some green companies will necessarily have to hire inexperienced employees. In the second quarter of 2008, before the recession began, a number of clean technology companies already had reported a talent shortage 6,7,8. That changed in the recession, with hiring slowing as cleantech companies saw project delays, layoffs and bankruptcies 9,10,11. Industry watchers predict the demand for personnel will soon rise again 12. As in many industries, experts predict the problem will be compounded by the retirement of the baby boomers 13.

Utilities could be particularly vulnerable, with many utility employees nearing retirement age 14. For example, 46 percent of the employees at the Pacific Gas & Electric Co., California's largest utility with more than 20,000 workers, will be eligible for retirement in the next four years 15. To meet these challenges, a wide variety of new training programs are being created [please link to Chapter 6 on training], and many employees are crossing over from other industries as well.

Truth in Accounting

Because job creation is a key goal of the Recovery Act, agencies are reporting the number of jobs “created or saved” by the package to help justify the spending. But there is debate over the accuracy of those numbers, particularly with green jobs. The final number of green jobs created or saved per stimulus dollar could impact future government spending on green programs. In November 2009, the Obama administration said the stimulus had created or saved 640,000 jobs by September 2009. The White House estimated the figure closer to 1 million jobs when October estimates – and indirect jobs – were included 16,17,18. It's difficult to verifiably account for saved jobs, as well as for indirectly saved or created jobs, even though they make up a big portion of the total 19.

In California, for example, a review by The Sacramento Bee concluded that up to a quarter of the 110,000 jobs reportedly saved by stimulus money weren’t likely in jeopardy in the first place 20. The administration’s latest estimates did not break out green jobs. But a study by researchers from four universities found that green job projections may be overstated 21,22.

Are Green Jobs too Expensive?

All together, stimulus jobs are expected to cost an estimated $92,000 per job, if everything goes as planned 23. Some critics say that the environmental segment will be the most expensive part of the stimulus and will actually reduce, rather than increase, economic activity and jobs.24 “Even worse than being a zero-sum game, government spending creates less economic activity than if the money had been left in the private sector,” according to conservative think tank The Heritage Foundation 25.

Others also have warned that green jobs could cost more than anticipated. A study from a Madrid university estimates that the U.S. stimulus’ support for renewable energy could end two jobs for every one created [53]. In Spain, the government ended up paying $774,000 for each renewable energy job that it had created since 2000, the study found 26. Spain isn’t alone, either. A renewable energy tax-credit program in Oregon cost 40 times more than expected, according to an investigation by The Oregonian 27.

Picking Winners

The jury’s still out on whether the government will make a good greentech investor, with some venture capitalists expressing skepticism 28,29. The wrong government investments could end up harming, not helping, the economy, critics argue 30. If government agencies make bad choices, selecting technologies and companies that end up needing “crutches” – or government support – forever, it “could ruin a complete sector,” Ajit Nazre, a partner at venture firm Kleiner Perkins Caufield & Byers, argued at the Renewable Energy Finance Forum – West in September 31. Creating green jobs isn”t as easy as just throwing money at the problem, experts warn 32. “It”s important to remember that the stimulus program is a one-time $800 billion experiment that will hopefully never be repeated in our lifetimes,” Chuck McDermott, a general partner at venture capital firm RockPort Capital, said at a Thomson Reuters conference in June 2009 33.

Government agencies are looking for investments that will result in jobs that last beyond the stimulus package’s 18 months 34. To do that, agencies are trying to pick projects that will help create strong and financially sustainable industries. And they are evaluating the likelihood of new technologies and business models to work, make a difference in combating climate change, create jobs and ultimately succeed in the marketplace without subsidies, all at the same time 35. Those different goals and requirements create an incredibly challenging and novel task. The difficulty is compounded by the need to fund projects quickly to improve the economy now 36.

Are Green Jobs Good Jobs?

One big subject of debate has been whether green jobs are as good as or better than the regular jobs they’re replacing. One 2009 report by the U.S. Senate Subcommittee on Green Jobs and the New Economy found that many green jobs pay below average 37. And a United Nations report also warns that not all green jobs offer decent working conditions 38. For example, the report found that working conditions in sugarcane plantations in Brazil “are notorious, marked by crowding, poor hygiene and nutrition, and violence by company security guards against workers. … These are not decent jobs by any stretch of the imagination.” 39 A Clean Edge and PayScale study found that many clean tech jobs pay well, with some entry-level positions requiring only high school degrees paying more than $40,000 and alternative energy design engineering managers earning a median salary of $112,000 40.

Al Lee, director of quantitative analysis at PayScale, said that because many of the positions are relatively new, most clean tech employees have less experience in the field than those in other sectors and would therefore earn less than employees with more experience 41. In addition, because the industry is just emerging, its unions are less powerful than, say, those in the auto industry, he said 42.

References

1. 1. Elizabeth Williamson and Louise Radnofsky (2 November 2009). “Stimulus Created 640,000 Jobs, White House Says.” The Wall Street Journal. http://online.wsj.com/article/SB125689799688318277.html. Retrieved 3 November 2009.
2. 2. Ron Pernick, Clint Wilder, et al. (October 2009). “Clean Tech Job Trends 2009” (PDF). Clean Edge. http://www.cleanedge.com/reports/pdf/JobTrends2009.pdf. Retrieved 12 November 2009.
3. 3. Ron Pernick, Clint Wilder, et al. (October 2009). “Clean Tech Job Trends 2009” (PDF). Clean Edge. http://www.cleanedge.com/reports/pdf/JobTrends2009.pdf. Retrieved 12 November 2009.
4. 4. Mark Waite (26 June 2009). “Study shows green energy jobs growing at 2.5 times higher rate.” Pahrump Valley Times.

   http://www.pahrumpvalleytimes.com/2009/Jun-26-Fri-2009/news/29606974.html. Retrieved 12 November 2009.

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