Green Jobs

We hear about "green jobs" from Sunil Sharan, who was "a director of the Smart Grid Initiative at GE from 2008 to 2009" and "has worked in the clean-energy industry for a decade"  Incredibly, green jobs may have been hyped and oversold by Team Obama:

"Green jobs" have become a central underpinning of the Obama administration's rationale to promote clean energy. But how valid is the assumption that a "clean-energy" economy will generate enough jobs to mitigate today's high level of unemployment -- new jobless claims were up 22,000 this week -- and to meet the needs of future generations? A green economy would have to spout jobs in the millions to do both. The facts challenge the prevailing thinking among some policymakers and officials that green jobs are a principal reason for transforming the economy.

Mr. Sharan illustrates a simple example of job creation and destruction using "smart meters", which are part of the new smarter electrical grid:

Nearly 40 million smart meters have been deployed worldwide, mostly in Europe. Jobs created in this industry can be broadly classified into four categories: installation, manufacturing, research and development, and IT services.

First, installation: It typically takes a team of two certified electricians half an hour to replace the old, spinning meter. In one day, two people can install about 15 new meters, or about 5,000 in a year. Were a million smart meters to be installed in a year, 400 installation jobs would be created. It follows that the planned U.S. deployment of 20 million smart meters over five years, or 4 million per year, should create 1,600 installation jobs. Unless more meters are added to the annual deployment schedule, this workforce of 1,600 should cover installation needs for the next five years.

Hmm, these guys are working 7.5 hours a day six days a week - we can't be talking about AFSCME jobs here.  And Mr. Sharan has evidently not taken on board the lesson of the weatherization program - many, many jobs will be created surveying prevailing wage standards for smart meter installers across the country.

After noting that most of the smart meters will be manufactured abroad Mr. Sharan presses on with "How Green Was My Job?"

Now let's consider job losses. It takes one worker today roughly 15 minutes to read a single meter. So in a day, a meter reader can scan about 30 meters, or about 700 meters a month. Meters are typically read once a month, making it the base period to calculate meter-reading jobs. Reading a million meters every month engages about 1,400 personnel. In five years, 20 million manually read meters are expected to disappear, taking with them some 28,000 meter-reading jobs.

One might quibble - if meters are actually read once every there months (with estimated readings in between), then 28,000 meter readers are actually surveying 60 million meters per month.  Only a third of these people, or about 9,000, will become redundant if 20 million smart meters have been installed.

Still, send better quibbles!  The gist is that 1,600 installers can work diligently for five years and permanently displace multiples of that number.

In other words, instead of creating jobs, smart metering will probably result in net job destruction. This should not be surprising because the main method of making the electrical grid "smart" is by automating its functions. Automation by definition obviates the need for people.

As I recall, smart metering does lots of other clever things, like turning off my air conditioner when my utility is running at peak output to avoid brownouts.  But it sounds like a loser of a jobs measure.

Let's have a bit more gloom from Mr. Sharan:

In other "clean-energy" sectors such as solar and wind energy, jobs are predicted to emerge in the same broad categories of installation, manufacturing, R&D and IT services, but the near-term expected levels of investment in and adoption of these renewable sources of energy mean that net job creation should top out in the tens of thousands, as opposed to the desired hundreds of thousands or more. Electric vehicles represent another promising green sector, but even if the vehicles were rolled out in substantive quantities, jobs would be created mainly in research and development and infrastructure support, and there, too, only in the hundreds or maybe even thousands. Manufacturing jobs would grow only incrementally since electric vehicle production will for the most part cannibalize that of gasoline-powered cars.

And we close with some jobs gloom from Ronald Bailey of Reason:

When House Speaker Nancy Pelosi (D-Calif.) dropped by the Copenhagen conference, she said of Waxman-Markey, “It’s all about the jobs.” To hear Pelosi talk, saving the planet from climate doom is incidental to making sure Americans are employed making solar panels and weatherizing houses. Sen. John Kerry (D-Mass.), a co-sponsor of an energy and climate change bill in the Senate, similarly asserted in Copenhagen, “Our bill is essentially a jobs bill.”

Showering government largess on an industry will certainly increase employment in that industry. It’s much less clear that such subsidies will produce more jobs on balance. Kerry thinks it will, claiming that when Germany enacted “strong policy mechanisms to drive investment in solar power and other renewable energy sources,” the result supposedly was employment growth: “Renewable energy usage has tripled to 16 percent, creating 1.7 million jobs. By 2020, Germany’s clean energy sector will be the biggest contributor to the nation’s economy.” 

An October 2009 study by RWI, a nonprofit German economic think tank, however, concluded that policies pushing renewable energy end up producing “job losses from crowding out of cheaper forms of conventional energy generation, indirect impacts on upstream industries, additional job losses from the drain on economic activity precipitated by higher electricity prices, private consumers’ overall loss of purchasing power due to higher electricity prices, and diverting funds from other, possibly more beneficial investment.” The report called Germany’s experience “a cautionary tale of massively expensive environmental and energy policy that is devoid of economic and environmental benefits.”

Iain Murry cited that study in Congressional testimony.

 

Comments

[Al Asad]

A Tea-Baggers idea of 'Green' is colored by their lustful obsession with Nuke Power.

Fission is their only mission, and the green glow from waste byproducts should be found on breakfast cereal.

Small alternative energy entrepreneurs can suck wind and die. The only cost=effective government contractor is of the oligarchic variety. KBR is the only big dog they approve, but it is due to the TeaBaggers love of fiscal responsibilty, not their well-documented disdain for social progress, which propels their ignorance and nihilism.

[Jim Ryan]

Al Asad is doing parody. I couldn't spot it at first. The best parody takes a stupid position and makes it slightly stupider than even the morons who hold it ever do, and Al Asad has a knack for this. Hats off to you, Al. You're good.

[TheRadicalModerate]

Hmm, let's see: We'll replace an industry with relatively low labor intensiveness (oil, gas, and coal) with a highly labor-intensive one (solar, wind, etc.). Since labor pretty much makes up 85% of the cost of everything what does this do to the price of energy?

We already have a pretty good idea how sensitive our economy is to the price of energy. So: job creation = some baseline - fossil fuel workers + green energy workers - workers who can't get hired because the whole economy is growing slower. Ya think that number will be positive or negative?

[The value of the energy taken from the wind or the sun is always less than the damages caused by so doing.]

It's all quibbling. Wind and solar haven't the energy density to make the propositions viable, except for localized or specialized applications. Infrastructure costs are a derivative of that problem.
======================================

[Ignatz]

--It typically takes a team of two certified electricians half an hour to replace the old, spinning meter.--

You can cut his 1600 jobs estimate at least in half.
It took one PG&E guy about five minutes to swap ours out. All he has to do is break the old seal, yank the old one and plug the new one in.

[Soylent Red]

It's best to read Al Asad's posts aloud, in a raspy, conspiratorial whisper.

Try it!

[How many government certified and employed electricians does it take to change a lightbulb?]

That's PG&E for you.
============

[test]

test

[meter readers union]

we're against the smart grid.

[Danube of Thought]

The whole concept is nonsense. Jobs arise in industries that produce something that is in demand at a price the customer is willing to pay. Government is powerless to "create" jobs, green or otherwise, other than by delivering taxpayer money to some favored group.

[Ignatz]

--Government is powerless to "create" jobs, green or otherwise, other than by delivering taxpayer money to some favored group.--

....which simultaneously "creates" jobs the market has already demonstrated do not make economic sense and takes capital either through taxes or borrowing from the private sector, preventing it from using the capitol to create jobs the market actually does want and can sustain.
Which, in turn is precisely why the idea of a positive multiplier for government spending is a fantasy.

[Al Asad]

"The whole concept is nonsense"

Your historical context must post-date the
advent of transistors.

[John]

Georgia is promoting "Green Jobs" in the biofuel industry. For the life of me, I keep thinking, how many pulpwood workers will Georgia need?

Regards

[PaulL]

Dem Sen. Sherrod Brown of Ohio says that there will be MILLIONS of green jobs, so I don't know.

[Ignatz]

--Your historical context must post-date the
advent of transistors.--

The transistor was first patented in the 20s or 30s and was perfected at Bell Labs.
You're probably thinking of TANG.

[Al Asad]

"perfected at Bell Labs."

At too high a price for mass production. You see, it's about cost-per-unit. When the gubmint contracted overseas to mass produce the transistor, it lowered the price enough so that Joe Lunchbucket could afford a portable radio.

See. That's the context for your 'nonsense'.

[Danube of Thought]

"You see, it's about cost-per-unit. When the gubmint contracted overseas to mass produce the transistor..."

In a word, nonsense. See, Texas Instruments, 1954.

In any event, what exactly is the "green technology" that, if mass-produced pursuant to government contracting (overseas or otherwise), would suddenly become desirable on a cost-per-unit basis?

[Pops]

Green jobs under Obama means sitting home unemployed and getting unemployment check.

This is an issue the weak knee'd Republicans should bash Obama over the head with..

If Obama really believes in Clean and Green and doesn't want Coal power plants, then he should ban the export of coal to China.

China burns coal far less efficiently then we do yet Obama punishes our Coal plants while letting the trains and ships roll to burn that coal in China and do MORE damage to the environment.

A green job would be any job that used more coal here and less coal in China.

[Danube of Thought]

The advent of transistors, historical context-wise:

Many scientists predicted it would be years before a production-worthy silicon transistor process could be developed, and others theorized it could never be built in quantity. But Executive Vice President Pat Haggerty's plan was in place, and TI had the team to meet the challenge head-on.

By the summer of 1953, the team was working night and day on the dual tasks of producing the silicon crystals with electrically satisfactory junctions, and developing methods of fabricating silicon transistors.

In April 1954, it all came together. Using high-purity silicon material purchased from DuPont, the team grew a silicon crystal. They cut a quarter-inch bar from the crystal and attached the electrical contacts to it on the morning of April 14.

On May 10, 1954, TI announced the commercial availability of grown-junction silicon transistors.

[Army of Davids]

The jobless problem will be over soon. Pelosi says ObamaCare will create 4 million new jobs. She has the track record to back up this claim so I believe her. Add the green jobs from the stimulus and Cap and Trade and everything is even better.

Some people believe that ObamaCare and Cap and Trade will kill jobs but they are mostly greedy businesspeople who don't understand "social justice" and the evils of man made global warming and it's cataclysmic events.

[Danube of Thought]

Al Gore taking his lumps at the Apple shareholders meeting:

"Al Gore took his lumps at Apple's (AAPL) shareholders meeting Thursday.

"Sitting in the front row with the other outside directors, he had to bite his tongue as two pro-environment proposals were voted down and a gadfly named Shelton Ehrlich took the mic to call him a 'laughingstock.'

"'The glaciers have not melted,' Ehrlich said, referring to Gore's frequent warnings about the effects of global warming. 'If his advice he gives to Apple is as faulty as his views on the environment then he doesn't need to be re-elected.'"

[PaulV]

The vast majority of any green jobs will be in China. Neither Leo or BO are very smart.

[Al Asad]

, "what exactly is the "green technology" that, if mass-produced pursuant to government contracting (overseas or otherwise), would suddenly become desirable on a cost-per-unit basis?"

It IS difficult for some to see the analogy, but if you compare transistor cost before and after the outsourcing, then make the HUGE quantum leap to photovoltaic cell cost before and after the same GUBMINT action,; voila!

*See the thread above for a discussion on
conservative intelligence.

[Pofarmer]

So, the answer, according to El Asshat, is to outsource our photovoltaic cell and wind generator production. Yeah, as if that's not happening already.

[PD]

It IS difficult for some to see the analogy

Might not be so much a difficulty in seeing the analogy as simply considering it wrong.

In this you are like Obama: If the dolts don't applaud the wisdom of your position, it must be that you simply haven't explained it well enough. It couldn't possibly be that the dolts consider your position incorrect.

[Danube of Thought]

Poor Al Asad has resorted to economic baby-talk.

First he alludes to some mythical "outsourcing" that suddenly made the transistor economically efficient (altogether ignoring the undisputed historical fact of its successful commercial development by Texas Instruments). Tell us, Al, exactly who outsourced what to whom, and what in God's name was it about this outsourcing that changed the economics of the transistor?

Next he asks us to leap from the goofball false example of the transistor to draw an analogy to the photovoltaic cell. Tell us again, Al, what is to be outsourced to whom, and why? What, indeed, do you understand the term "outsourcing" to mean?

Al Asad, you seem to be new around here. As you are learning, quickly and to your public embarrassment, we don't suffer fools gladly at this site. You are not able to hit big-league pitching.

[Maybe tomorrow after being born in a barn tonight.]

Let's see, figure out a way to make a photovoltaic cell smaller and more powerful, and al asad will begin to make sense.
================================

[Danube of Thought]

"..figure out a way to make a photovoltaic cell smaller and more powerful..."

Obviously, the only way anyone can figure out how to do that is if someone outsources something to somebody.

I'm beginning to think Al Asad may be the oft-disgraced Cleo, slinking back aboard under yet another alias, but dragging all the telltale baggage of the ignoramus.

[The government can make Unicorn Farts smell as sweet.]

You're obviously not paying attention, DoT; it's the government financing that is the magic ingredient.
==========================

[Danube of Thought]

"...it's the government financing that is the magic ingredient."

Al Asad will perhaps tell us whether that is sufficient, or whether we must also stir in a dollop of outsourcing. Or perhaps he is starting to feel a bit ill...

[narciso]

This might go in the next thread, but it fits here as well, in the LUN

[cathyf]

Which, in turn is precisely why the idea of a positive multiplier for government spending is a fantasy.

That's just false -- some government spending clearing has a very large positive multiplier. Spending on the court system, without which we could not have contracts. Spending on the police, without which crime would push out most positive economic activity. Spending on the military, without which one of the world's Stalins, Maos, Castros, Chavezes, etc. would have waltzed in and taken over. Spending on the patent office (which provides the administrative structure to enforce the only rights mentioned in the main body of the Constitution as opposed to the Bill of Rights) which allows for people to get paid for creating intellectual property, without which there wouldn't be much intellectual property.

Sure, there's a definite pattern here... The government does do things which are extremely valuable and way more valuable than they cost us in tax dollars. But it's pretty much the stuff Madison and the other Founding Fathers set up in 1790ish. There may be an occasional (probably small) new thing that the government can do with a positive multiplier, but skepticism is always warranted.

[Danube of Thought]

Cathyf, you've just identified a series of public goods and services, for which it is appropriate that we all be taxed (the fire department also comes to mind).

Similarly, it is appropriate to make the inoculation of citizens against infectious diseases a public undertaking, inasmuch as we all benefit from it. But there is absolutely no public benefit in providing Mrs. Jones with a hip replacement, and the case for doing so at public expense has not been made on any other than an emotional basis. Madison would not approve.

[cathyf]

There are lots of other public goods in health care besides immunizations, because so much of health care is intellectual property. Start with the R&D costs of every drug and medical device (the knowledge of which chemicals to put together to get a working drug or which pieces to put together to get a working device.) All of the knowledge of which symptoms add up to which diseases. The knowledge of how to interpret lab tests. The knowledge that it's a good idea to wash your hands before working on a patient, but a bad idea to bleed them.

Just because they are public goods doesn't mean that they need to be taxpayer-funded. It does mean that they require the government to somehow enforce some regime to force users to pay for them, or no new intellectual property will be produced.

[jimmyk]

It would be more accurate if all these "job creations" were called something else, like "job diversions" or "job substitutions." The main effect is to get someone to do something instead of something else. All those meter installers could (and likely would) be doing something else instead this 21st century equivalent of digging holes and filling them up again.

It would make much more sense to put those installers to work helping to generate more electricity (say by building nuclear reactors).

[Danube of Thought]

Agreed, Cathyf.

Jimmyk, I think that ultimately it would make the most sense not to " put those installers to work" doing this, that or the other, but to allow free people to offer them work in order to do something that other free people want to pay for.

[Pops]

Cathyf: ""That's just false -- some government spending clearing has a very large positive multiplier""

The answer here is that it is all dependent on HOW the government is spending. If the government went out and borrowed all the money to perform essential services, it would be removing money that is available to the private economy to grow and deciding how to invest BORROWED dollars.

Obama went out and borrowed 1.6 TRILLION to spend on HIS priorities and then complains the banks aren't lending to private businesses...after he soaked up most of the available capitol.

While courts, police, patents have some cost, they do not overwelm the overall available money for growth. If we were all being taxed at 90% of our income to pay for police and courts, clearly they would be a hindrance to growth and not a growth multiplier.

And those that say all of these functions need to be federal, hasn't actually thought about it. All of these functions were done privately or by municipalities long before big daddy government stepped in.

And criminals back then would love the courts they have now that protect them from a citizenry that would have strung them up and saved the costs.

[Queen of a World of Fat-Bottomed Skeptics.]

Here's an amusing little portrait of Nancy Pelosi. She goes around now trying to justify the authoritarian bit of legislation called Cap and Trade as being about 'Jobs, jobs, jobs'. Meanwhile, all those out of work, and many of those nearing it, understand that Cap and Trade is a job killer and not as Nancy says. She highlights that she is all about power and not at all about the people.

Keep it up, Nancy. Who do you think you are fooling?
===========

[PD]

Herself?

[jimmyk]

Jimmyk, I think that ultimately it would make the most sense not to " put those installers to work" doing this, that or the other, but to allow free people to offer them work in order to do something that other free people want to pay for.

Agreed, of course, and I didn't mean to suggest otherwise, but thanks for the reminder. It's important not to get caught up in the statist language of the Democrats.

[cathyf]

Pops -- the point about borrowing money is this: if the multiplier is more than one, and the multiplier is more than (1+r), where r is the interest rate, then the government should be borrowing the money to do it if that's what it takes.

If you want to see what economic activity looks like without the rule of law, look at Haiti before the earthquake. Unemployment around 80%. Lots of people scrabbling out an existence providing small consumer goods in an expensive and inefficient way because there is no protection of their property rights and ability to carry inventory.

The government always plays the game where they hold us up for ransom by cutting essential services first in order to get us to pony up more money. In the case of the provision of the rule of law, though, I say we have to pay. The multiplier is way more than 1+r, even if they have to borrow the money.

[George S]

This green jobs nonsense is a page out of Stalin's economics. Old Papa Joe's reading of capitalism was that it took away wealth from the workers by forcing them to work harder while simultaneously decreasing their consumption by paying them less than the wealth they create. But he agreed that the difference in wealth accumulated by the capitalist was the engine of economic growth. So, the central planners were to take the place of the market forces which allocated resources to the most efficient users of capital, and take on the job of allocation and apply the individual model to the collective. Presto, a command economy that emulated the free market without the exploitation of the Worker.

However, what happened instead was that capital was allocated on political preferences to factories, which caused the economy to stagnate. The factories hummed, the workers toiled, the bureaucracies grew but no economic progress was made. The same thing awaits us with green jobs, the model will be followed step by step.

We did, however, import the Soviet model to the US in the form of (e.g.) the Motor Vehicle office. The government creates the demand (and finances it, too!) for driver's license and we all have to put up with one of the most inefficient things on the planet. And everyone knows, privatizing DMV would require far less tax dollars and provide far more efficient service.

Think DMV as the place to go to get your solar panel installed and serviced; along with busy signal awaiting you at the other end of the phone when you have a question or a problem. Especially during Break Time.

[picnic]

For all the intellectual arm waiving, most of filling in holes seems to be the head in the sand type. Green or no green, this is an unsustainable model sinking fast. Without a collective spirit we all might be pointing fingers at the bottom of it sooner.