Um, I Think It is Time To Introduce You to the Term "Incremental"

The US Conference of Mayors has introduced a "study" extending on Obama's idea of millions of new green jobs:

A major shift to renewable energy and efficiency
is expected to produce 4.2 million new environmentally friendly "green"
jobs over the next three decades, according to a study commissioned by
the nation's mayors.

The study to be released Thursday by the U.S. Conference of Mayors,
says that about 750,000 people work today in what can be considered
green jobs from scientists and engineers researching alternative fuels
to makers of wind turbines and more energy-efficient products.

But that's less than one half of 1 percent of total employment. By
2038, another 4.2 million green jobs are expected to be added,
accounting for 10 percent of new job growth over the next 30 years,
according to the report by Global Insight, Inc.

Well, lets leave aside the measurement issue of making forecasts and establishing targets for metrics like "green jobs" that can be defined however the hell someone wants.  For example, if they really were to define "green jobs" as they say above "makers of ... more energy-efficient products," then nearly everyone in industrial America already has a green job.  Every car made today is more fuel-efficient than the equivalent car made 20 years ago, every motor more efficient, every machine more productive.

But lets discuss that word "incremental."  Politicians NEVER, EVER cite job growth projections that are truly incremental.  For example, tariff program X might be billed as saving 100 jobs in the steel industry, but what about the jobs lost in the steel-consuming industries due to higher costs?  The same is most certainly true in this whole "green jobs" fiasco.  It is the perfect political promise - impossible to define, impossible to measure, and therefore impossible to establish any accountability.  Everyone who makes the promise knows in his/her heart the jobs are not truly incremental, while everyone who hears the promise wants to believe they are incremental.  Politics thrives on this type of asymmetry.

I looked before at the impossibility of these numbers being incremental, but here is a second bite of the apple.  The article says specifically:

The report, being presented at a mayor's conference in Miami, predicts
the biggest job gain will be from the increased use of alternative
transportation fuels, with 1.5 million additional jobs, followed by the
renewable power generating sector with 1.2 million new jobs.

Let's take the second number first.  Here are the current US employment numbers for the US power generation field:

Construction of power generation facilities:           137,000
Power generation and supply:           399,000
Production of power gen. equipment           105,000

That yields a total of 641,000.  So is it really reasonable to think that these green plans will triple power generation employment?  If so, then I hate to see what my electricity bill is going to look like.

The fuel sector is similar.  There are about 338,000 people employed in petroleum extraction, refining, transportation and wholesale -- a number that includes many people related to other oil products that are not fuels.  Add in about 100,000 for industry supplies and you get perhaps 450,000 jobs current tied to fuel production plus 840,000 jobs in fuel retailing (ie gas stations).  How are we going to add 1.5 million net new jobs to a fuel production sector with 450,000** currently?  And if we do, what is going to happen to prices and taxes?  And if the investments push us away from liquid fuels to electricity, don't we have to count as a loss 840,000 retail sector jobs selling a product no longer needed?

** Your reaction may be that these job numbers look low.  They are all from the BLS here.  Here is a quick way to convince yourself there really are not that many people working in the US oil and gas industry:  Despite years of mismanagement and government subsidies, politicians continue to fawn over auto companies.  Despite years of excellence at what they do, politicians demonize oil companies.  The reason has nothing to do with their relative performance, ethics, importance to the country, greed, etc.  The difference is that the auto companies and their suppliers employ millions of voters.  Oil companies employ but a few.

This is such ridiculous garbage as to be unbelieveable, but every paper in the country will print this credulously.  Because if journalists were good with numbers, they wouldn't be journalists, they'd be doing something that pays better.


  1. Nobrainer:

    It doesn't make much sense. From what I've read, wind farms need 6 full-time employees per 100MW of installed capacity.

    If you do the math, you see that to achieve 20% wind power as outlined in pickens plan, you need ~500,000 MW of wind-turbine installed capacity. That translates to ~30,000 jobs.

    For comparison's sake, you can estimate that you would need to build 100 nuke plants of 1000MW capacity to generate 20% of American electricity. Such a plant would employ ~500 people. That translates to ~50,000 jobs required.

    Scaling up to 100%, we could estimate that the ceiling for power production jobs is about 500,000, which is just a skosh over the current number. Thus the net, new jobs is 100k, and a full order of magnitude lower than the mayors estimate.

  2. rxc:

    The number of people at a nuclear plant depends on a number of factors, most notably whether the plant is owned by a utility that owns other plants, and can therefore gain some economies of scale by centralizing engineering and maintenance functions. 500 worker per 2-unit site is a bit low. Probably about 800 per site is a better number, if you include all of the guards, who seem to outnumber the operating staff.

    Then you need several thousand people (both engineers and support staff) per utility in a central engineering organization. The 3 reactor vendors themselves have about 10K people each in engineering organizations, and then probably about 10K people each in their fuel fabrication organizations. The US NRC has about 1200 people right now just working on the current 100 operating reactors, and the licensing of new reactors. This does not include the inspectors, researchers, or materials regulators. I believe that NRC staffing in FY06 was around 3200 people, and that is supposed to grow to close to 4000 to support the new reactor licencing.

    Then there are the various suppliers, but it is difficult to apportion people at a steel company among different users of their products. The current controlling path for nuclear plant construction is heavy-section steel forgings, which can only be made in one factory in Japan, which also probably makes these parts for lots of other industries. It would be nice if someone in the US would restart a similar facility, but without some sort of guarantee that they will be in operation for a long time, I doubt that it will happen.

    I think that the bigger question is where they are going to find people to do the sort of work that is needed to maintain these alternative energy systems. It will not be high-paid engineers, but instead low-paid maintenance workers, to clean the surfaces of solar panels, and to cut the grass around windmills. There might be some expensive jobs to do maintaining off-shore wind, but they will not necessarily pay well, because if they do, the price of the energy will go too high.

    We have a hard time right now trying to find people do these sort of jobs in areas like agriculture, so where are we going to find them to take care of solar panels?

  3. TDM:

    If we replaced all power generation in the U.S. with people running on treadmills we would create around 30 Billion new jobs. Imagine how much prosperity all those new jobs would create.

    We need an energy policy that produces energy not one that wastes workers' time.