CETI’s recently released Net-Zero Northwest Workforce analysis offers insights into Northwest energy employment as the region aims to achieve net-zero emissions by 2050, with a focus on the next seven years through 2030.
The study found that despite displaced fossil-fuel related jobs, Northwest net energy employment would grow by 17% from 2021 to 2030 if the region were on the path to net-zero by 2050. But an equitable clean energy transition will not happen on its own: how can we ensure that this transition not only brings that job growth, but that these are quality jobs that pay sustaining wages with benefits (including healthcare), and the opportunity for advancement in a safe work environment?
One aspect of the NZNW Workforce analysis that shines a light on job quality is its examination of employment by wage tier. BW Research, the firm that modeled the jobs, developed wage tiers based on the MIT Living Wage Calculator of median living wages for different living circumstances, weighted by employment across the four Northwest states. The wage tiers are: less than $30 an hour, $30-$44 an hour, or more than $44 an hour.
The figure below helps illustrate why efforts to address job quality remain important in all energy sectors included in this analysis. While the number of jobs in each sector increases between 2021 and 2030, the distribution of jobs within each of these three wage tiers does not significantly change:
Note: Use buttons next to figure title to switch between 2021 and 2030, and hover over bar graphs to see additional details.
There are various strategies that could promote good-paying jobs in emerging clean energy sectors and bring economic development to a wide range of communities that have historically been left out of opportunities to share in economic prosperity.
Through the Inflation Reduction Act (IRA), the federal government has taken significant steps to try to ensure that clean energy investment creates quality, good-paying jobs. One such mechanism is a bonus tax credit that links prevailing wage (a minimum wage rate typically the average or market wage for a type of work in a specific area) and registered apprenticeship requirements to the level of clean energy tax incentive available.
While it is still early to evaluate effects of the IRA provisions on clean energy job growth and job quality, stories are emerging around the country about people of diverse backgrounds entering the energy workforce as electricians, automotive system technicians, and more, thanks to expanded opportunities from the IRA.
Prevailing wages have historically been established for public works or federal construction projects. While prevailing wage requirements can be met without unions demanding them, historically unions have been effective at ensuring workers are paid the prevailing wage. With prevailing wages now tied to certain federal IRA incentives, there may be more market demand for union involvement.
In addition to benefits for workers, UC Berkeley Labor Center research finds that prevailing wages accelerated solar production in California, pushing back on the argument that prevailing wage requirements hinder clean energy development by making it too expensive.
Registered apprenticeships (paid positions with on-the-job training and additional instruction) are another key strategy that can be sponsored by unions, employers, or collaboration between the two. Registered apprenticeships have proven to bring higher earnings to participating workers, help employers reduce the cost of hiring, and improve company culture and employee loyalty.
Project Labor Agreements (PLAs, agreements negotiated in advance of a project to specify wages, benefits, working conditions, and more) can be another helpful tool to ensure job quality. President Biden signed an Executive Order in February 2022 clarifying that “it is the policy of the Federal Government for agencies to use project labor agreements in connection with large-scale construction projects to promote economy and efficiency in Federal procurement.”
Recent proposed rulemaking from the U.S. Department of Treasury and the Internal Revenue Service also includes several provisions connected to PLAs and their role in encouraging compliance with the tax incentives for registered apprenticeships and prevailing wage.
Lastly, Community Benefits Plans (CBPs) often go beyond the scope of PLAs and can also be beneficial tools to maximize benefits for local communities. The DOE requires Community Benefits Plans as part of all Bipartisan Infrastructure Law (BIL) and IRA funding opportunity announcements and loan applications. Ensuring this work gets done quickly but also correctly—with proper engagement with local communities—is likely one of the biggest challenges to emerge with this transition.
Our analysis found that on balance net energy jobs in the Northwest would grow on the path to net-zero. The question for the region’s stakeholders is how to manage the transition to clean energy in such a way that as many people as possible benefit, either by having access to jobs that were previously foreclosed or by receiving training that would enable them to learn new skills and maintain a good standard of living.
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