The pandemic year of 2020 saw a sharp decline in clean energy jobs across the Midwest, the first year-to-year drop since the 2017 inception of annual clean energy jobs reports by the Clean Energy Trust and Environmental Entrepreneurs (E2).
At one point in 2020, more than 131,600 Midwest clean energy workers had filed for unemployment, according to the new report based on federal data. But during the second half of 2020, that job loss was mitigated by jobs being created or restarted. Ultimately, clean energy jobs in the Midwest were down 66,100 compared to a year earlier, representing an 8.9% decline across Ohio, Kansas, South Dakota, North Dakota, Nebraska, Illinois, Indiana, Minnesota, Iowa, Wisconsin, Missouri and Michigan.
The energy efficiency sector lost 12% of its jobs compared to 2019. Renewable energy lost 2.8%, grid and storage lost 7.8%, and clean fuels lost 5%. But jobs actually grew compared to 2019 in advanced and clean transportation, namely hybrid and electric vehicles, with an increase of 3% across the Midwest.
Now, advocates say, it is crucial that investment, incentives and policies are created to bolster clean energy jobs. E2 Midwest advocate Micaela Preskill said she is hopeful the reconciliation process for the recently passed federal budget and infrastructure package will enshrine in law a national clean energy standard and related programs.
“At a minimum, we need Congress to enact a national clean energy standard,” she said. “We need to be enhancing clean energy tax provisions; we need to make domestic manufacturing and deployment of clean energy technologies a priority; we need to fund a national clean energy accelerator that will provide financing for clean energy; we need to prioritize funding in communities of color and under-resourced communities; we need to fund workforce programs; and, of course, we need to invest in the clean auto industry to create jobs and make sure our country can compete abroad. The reconciliation process is what’s really going to deliver in this moment and bring bold action to address the climate crisis.”
With 677,000 total clean energy jobs, the Midwest has more than 22% of the nation’s clean energy positions, the organizations calculated. And the clean energy sector could help drive a robust economic recovery from the pandemic in the Midwest, advocates say, given the likelihood of increased incentives for clean energy, the Midwest’s manufacturing infrastructure and other market forces.
The annual clean energy jobs reports, based on the Energy Department’s 2021 U.S. Energy Employment Report, found that “clean energy jobs in 9 of the 12 Midwest states exceeded their overall economies’ job growth rate” last year.
“Despite the industry’s overall decline, more Midwesterners worked in clean energy than worked as accountants, auditors, computer programmers, web developers, and real estate agents and brokers combined,” the report said.
An uncertain future
While job creation in the second half of 2020 was encouraging, “it was a significant rebound from a pretty steep decline,” said Phil Jordan, vice president and principal researcher at BW Research, which conducted the analysis.
“We’re still behind pre-pandemic levels with the growth rates and overall employment. When the pandemic started, there was a much stronger shut down; people were sheltering in place. For the first few weeks, there was a lot of confusion over who was an essential worker — whether people would want contractors in their homes. Over time it became clear that things like utility-scale installations could continue and be done safely with PPE and outdoors.”
While such work will likely continue safely despite the delta variant of the coronavirus and rising infection numbers, residential and consumer-level clean energy sectors could suffer anew because of both safety concerns and the ongoing economic effects of the pandemic.
More than 70% of total clean energy jobs are in energy efficiency, which often involves work inside individual homes. Within the energy efficiency sector, HVAC systems account for the largest portion of jobs.
Jordan noted that research by E2 showed the federal Payroll Protection Program helped many smaller clean energy businesses survive, and similar assistance or other supports could be crucial in the future.
Success and potential
The report cited Minnesota’s recent clean cars program and Michigan’s 2050 decarbonization goal as drivers of jobs. Minnesota saw a 2% growth in alternative transportation. Michigan had only 1% growth in that sector given its already strong auto industry, but it had more than 24,000 people employed in advanced transportation at year-end, leading other Midwest states.
Electric vehicle jobs specifically grew 6.3% in Michigan to 5,948 workers, the report found, with the sector “poised for future growth with supportive policies and significant commitments to EVs by major vehicle manufacturers like Ford and General Motors.” The report also identified wind as a bright spot in Michigan, with jobs growing 3% to almost 5,000 workers total employed.
While large auto companies play a major role in Michigan’s clean energy economy, 78% of Michigan’s clean energy companies were small businesses employing 20 or fewer people. Small businesses likewise are driving the clean energy sector across the Midwest, with 71% employing 20 or fewer workers.
Veterans held 11% of clean energy jobs across the Midwest, the report found. And while Chicago, Detroit and Minneapolis were hubs for clean energy jobs — at over 81,000 in Chicago — more than a fifth of clean energy jobs in the Midwest were in rural areas.
Across the Midwest, total solar jobs lagged only slightly behind wind jobs, with 37,842 versus 36,837. Ohio had 7,647 solar jobs, compared to just 1,147 wind jobs, and in Wisconsin and Minnesota solar also outpaced wind in total jobs. Illinois, by comparison, had 9,105 wind jobs and 5,526 jobs in solar — an industry that blossomed after the state’s 2017 energy law created incentives but has since suffered, from the pandemic and also the expiration of incentives and the failure to pass a bill that would renew them.
A tipping point
Preskill emphasized that the dire Intergovernmental Panel on Climate Change report released this week only underscores the urgent need to decarbonize generation, transportation, buildings and more, creating jobs in the process.
She said automakers’ commitments to electric vehicles, instituted as then-presidential candidate Joe Biden was emphasizing clean energy and clean vehicles on the campaign trail, is an example of how political will can drive rapid change.
“That’s a snapshot of what leadership from the federal level can really mean in terms of job creation,” she said. “We’ve barely scratched the surface. There’s a lot more to do in advanced transportation, but when we do see that leadership, we see companies respond and jobs grow.”
Even as things look hopeful on the federal level, she said the Midwest risks falling behind given recent trajectories on clean energy.
“The outlook in the Midwest states right now is a little depressing,” she said. “Illinois, which was supposed to be the leader, has failed to reach a compromise [on the proposed energy bill] and states like Iowa and Ohio are continuing to roll back clean energy and put up more roadblocks. The Midwest is a real hub of clean energy jobs, but it’s going to be up to state leaders to step up or cede some of these jobs to other parts of the country.”