Saving the Planet Is Not a Jobs Killer: The Employment Impact of Phasing Out Fossil Fuels

An aggressive reduction in fossil fuel use over two decades is projected to cause an annual job loss that is less than the number of workers that employers typically fire or lay off in a single day, even in states with a large fossil fuel industry, according to a new report released today by the Center for Economic and Policy Research (CEPR).

The Employment Impact of Curtailing Fossil Fuel Use, by senior economist Dean Baker and researcher Aiden Lee, projects the amount of displacement that can reasonably be anticipated nationally and by state (including the District of Columbia) across jobs with skills that are readily transferable and jobs with skills that are largely industry specific.

Employment in the oil and gas industries is not an especially large share of the economy. If fossil fuel consumption were largely eliminated over a 20-year period (an extreme scenario), it would imply a loss of an average of 53,600 jobs annually over this period. If only the jobs with nontransferable skills were eliminated at this pace, the loss would be 32,700 a year.

"It's not an impossible task to make sure workers in the fossil fuel industry are provided with the skills, training, and opportunities to find other jobs," said co-author Lee. "The employment impacts of moving towards green energy is something that must be considered, and this report shows that it can be feasibly addressed."

For perspective, the report compares the projected job loss in the fossil fuel industry to job loss in manufacturing (caused primarily by the growth of the trade deficit) between 2000 and 2007. Over the seven years from December of 2000 to December of 2007, the country lost 3,435,000 manufacturing jobs, just under 20 percent of the total. This comes to an average job loss of 491,000 a year.

"This calculation gives us some perspective on the size of the possible job loss from phasing out fossil fuel consumption," said co-author Baker. "It should be possible to meet most of the job loss in the sector through retirements and other voluntary quits."

However, Baker adds that, "There will invariably be cases where a refinery or power plant is closed, and all the workers are laid off, which will almost certainly include many workers who are not ready for retirement. Ideally, we would make efforts to ensure these workers are reemployed elsewhere."