Green Jobs - Hope or Hype?

| by NCPA

The Obama administration and its allies have cited studies from the U.S. Conference of Mayors, the American Solar Energy Society, the Center for American Progress and the United Nations Environment Programme, among others, to support their claims that green investments will provide millions of new jobs. These analyses share a number of flaws, says Pete Geddes, an adjunct scholar with the National Center for Policy Analysis.

First, they confuse efficient and inefficient production. The green jobs model is built on the inefficient use of labor, favoring technologies that employ large numbers of people over technologies that use labor efficiently, explains Geddes. For example:

* According to the United Nations Environment Programme, solar energy requires nine times as much labor per megawatt of energy generated as natural gas, and nine times as much labor per megawatt of energy as coal.

* Furthermore, on average, solar energy costs three to five times as much per megawatt as electricity from natural gas or coal.

Second, many of the jobs "created" by government subsidies will not be filled by the unemployed but by workers shifting from one job to another. Thus, job creation could be overstated significantly, explains Geddes. For instance:

* Proposed global warming legislation threatens to shutter a number of fossil-fuel power plants while boosting employment at wind and solar facilities.

* Moving engineers from traditional power plants to renewable energy facilities should not count as new jobs creation.

Finally, these studies only examine jobs created by government programs, ignoring the jobs destroyed by higher energy prices and the taxes to pay for the increased spending. Experience in Europe, which has taken the lead in green job creation, confirms that this is an economic shell game. For example, according to a study of Spain's renewable energy initiatives:

* The Spanish government created approximately 50,000 green jobs, but as a result, lost about 110,000 other jobs.

* Only 1 in 10 new jobs were permanent.

* The average green job created since 2000 added $774,000 in costs to consumers' bills.

The report concluded that the high cost of green energy has driven energy-intensive Spanish industries to countries with lower energy costs.

Source: Pete Geddes, "Green Jobs: Hope or Hype?" National Center for Policy Analysis, November 19, 2009; also Gabriel Calzada Alvarez et al., "Study of the Effects of Employment of Public Aid to Renewable Energy Sources," Universidad Rey Juan Carlos, March 2009.