By 2020, the Environmental Protection Agency’s (EPA) proposed Clean Power Plan will create nearly 100,000 more jobs than are lost, according to a new report from the Economic Policy Institute, a non-partisan think tank.
The report’s initial estimates are higher than some similar studies; however, the institute found that the job impacts of the Clean Power Plan, which limits carbon emissions from power plants, would not last, and would become “almost completely insignificant by 2030.”
Coal mining and coal-fired power plants will face the biggest job losses if the Clean Power Plan is implemented, because coal-fired power plants are responsible for 39 percent of the United States’ electricity generation and three-quarters of the sector’s carbon emissions. But other sectors, including renewable energy, scientific research, and appliance manufacturing, will all increase, at least initially, the report found. Efficiency investments, such as retrofits for homes and businesses, will be a key driver in initial job growth, but will ultimately lower electricity demand, EPI said.
The report looks not only at direct employment — for instance, coal mining positions that will be lost, or solar industry jobs created — but also at indirect employment, such as a waitressing job in a mining town or railroad jobs affected by decreased coal shipping. That means the report looked at where coal miners are spending their paychecks.
But job growth analysis is incredibly complicated. Josh Bivens, research and policy director at the Economic Policy Institute and the report’s author, explained that measuring such things as doctor’s visits could end up on both sides of the ledger.
“Induced losses include fewer visits to doctors offices from people who’ve lost jobs, incomes, and insurance, but also include increased visits to doctors offices from people who have gained jobs, incomes, and insurance coverage,” he told ThinkProgress in an email.
But other related changes might not be included in a jobs analysis. For instance, the EPA estimates the Clean Power Plan will have “climate and health benefits worth an estimated $55 billion to $93 billion per year in 2030. This includes avoiding 2,700 to 6,600 premature deaths and 140,000 to 150,000 asthma attacks in children.” These savings are not included in the Bivens’ tally.
“I do not translate the monetized health benefits into jobs — that would be near impossible to do because even [though] they’re monetized they probably don’t add to measured GDP and hence employment,” he said.
More generally, though, Bivens acknowledged the ancillary benefits of the Clean Power Plan. “Given the vast importance of global climate change, this means that the impact of the CPP on economic, health, and environmental outcomes is likely to be quite large,” he wrote in the report. “It’s not an employment policy, so it really shouldn’t be graded on that continuum,” Bivens added on a call with reporters.
Bivens did emphasize, though, that even though overall the plan will add American jobs, expected losses will be “geographically concentrated.” Areas that have coal-fired plants or coal mining will be disproportionately negatively affected by the rule. Bivens noted that policies such as the Obama Administration’s support of miners’ health groups will be important to mitigate these effects.
There are roughly 80,000 people working in coal mining, according to the National Mining Association, but that number is declining every year. Domestic coal production, particularly in Appalachia, has fallen in recent years, largely due to lowering natural gas prices, which have made coal less competitive. There is also downward pressure on coal mining jobs because of increased automation in the industry.
Moreover, amid a global push to decrease carbon emissions, activist shareholders, including the world’s largest sovereign wealth fund, the Church of England, and Stanford University, have all divested from coal interests. Coal companies are also struggling with their cash flows, and recent analysis found that overall, they likely do not have enough money to pay for the environmental damages they have caused.
Because of the decline in the workforce, the United Mine Workers (UMW) pension fund is about $1 billion short of being in actuarial balance, the EPI report said. Bivens noted that policies to address the specific groups most impacted by the new rule will be critical, including recent Obama administration efforts to mitigate losses to the coal industry’s pension and health plans. The proposed Fiscal Year 2016 Budget provides more than $55 million in funding for job training, job creation, economic diversification, and other economic efforts in communities that have experienced layoffs due to the declining coal industry. According to the White House, that funding is “unprecedented” and will go toward improving the economic security of coal miners and their families, who have “helped keep the lights on in this nation for generations,” ThinkProgress reported in February.