Letter to MassCEC on Clean Energy Worker Shortages

February 28, 2021   Letter

Jennifer Daloisio, CEO

Massachusetts Clean Energy Center

63 Franklin Street, 3rd Floor

Boston, MA 02110

Kathleen Theoharides, Secretary

Executive Office of Energy and Environmental Affairs

100 Cambridge Street, Suite 900

Boston, MA 02114

Michael Kenneally, Secretary

Executive Office of Housing and Economic Development

1 Ashburton Room 2101

Boston, MA 02116

Rosalin Acosta, Secretary

Executive Office of Labor and Workforce Development

One Ashburton Place, Suite 2112

Boston MA 02108

Dear CEO Daloisio and Secretaries Theoharides, Kenneally, and Acosta:

As you're acutely aware, climate change is bearing down on us. The good news in Massachusetts is that all kinds of people are stepping up to respond. Thank you for your own exceptional efforts. Our shared goal is to get ourselves to a place where we can put a near-stop to the burning of coal, oil and natural gas, the fossil fuels that emit the greenhouse gases that heat up the planet. The pivot away from fossil fuels and towards alternatives can have positive ripple effects. Notably, it promises to create a lot of jobs.

Or, to be more precise, a lot of job openings.

Job openings versus jobs: this is the issue we want to raise. It's crucial that we reach the finish line the Legislature has set for Massachusetts -- net zero emissions by 2050. At present, we're not doing all that we could do to get us there.

We foresee ongoing challenges with workforce availability, an issue distinct from workforce training. We anticipate an upsurge in demand for energy workers in Massachusetts amid a downturn in supply. Trouble is, we cannot train people we don't have. Massachusetts needs to encourage in-migration from other states and other countries, and to make newcomers feel that this is a good place to work and to live.

Needed: An assessment of real-world workforce supply bottlenecks.

State government needs to get a handle on the mismatch. Absent remedial action, we will not have enough candidates to train for all the jobs we need to fill.

The Massachusetts Clean Energy Center is an economic development agency for the Commonwealth tasked with a special climate portfolio. We ask the Center to (i) do a comprehensive sizing of the supply and demand problem; (ii) complete a comprehensive inventory of our current capacity to address it; and (iii) advise in some detail on next steps Massachusetts should take to ensure a good match between labor demand and labor supply.

We appreciate that MassCEC is about to conduct one of its periodic "clean energy workforce needs assessments." It's one of the reasons we're writing this letter. But in the past the agency has taken a business-as-usual approach to these exercises. This time around, we ask the agency to go well beyond business as usual.

By business as usual, we mean a consultant's study that goes deep on computer-modeling the clean energy sector's demand for labor but then goes light on analyzing the real-world challenges of supply.

In asking the MassCEC to go beyond business as usual, we have in mind an exercise that, at a minimum, analyzes these real-world challenges: (i) statewide population and demographic trends in Massachusetts; (ii) competition for workers stemming from labor shortages across the whole of the state economy; (iii) competition among the clean energy sectors themselves, and the very real risk that one clean energy sector will fill out its ranks by cannibalizing the worker pool of another clean energy sector; and (iv) importantly, the tendency of consultants to avoid doing counts of the actual number of clean energy training slots in existence and to avoid examining the capacity of training programs to fill these slots and to "flex" -- to open up and fill additional slots. 

 

We appreciate the calls for more training programs, ideally outfitted with social and economic supports. These programs are needed. But a ramp-up in programs and funding cannot compensate for scarcities in the absolute numbers of local workers. A significant increase in training slots does not guarantee a significant increase in trainees.

We urge a more comprehensive clean energy workforce strategy, including (i) reducing student fees and tuition charges at public community colleges; (ii) increasing childcare and early childhood education options for young workers with families; (iii) increasing the housing supply; (iv) marketing Massachusetts as a destination for prospective new residents currently living in other states and other countries; and (v) taking equity and inclusion into account every step of the way.

Supply bottlenecks threaten in as many as five different clean energy sectors.

We see workforce supply bottlenecks looming in as many as five different clean energy sectors, all of which are important to achieving our climate goals.

We know you're aware of these sectors. They are (1) "energy efficiency" (heating and cooling buildings, heating water, drying clothes, and cooking food with a minimum of natural gas, oil or propane); (2) solar installations (generating electric power without releasing greenhouse gases); (3) green transportation (both mass transit and personally-owned electric vehicles); (4) power transmission restructuring (modernizing the grid); and (5) offshore wind (like solar, a way to generate electric power without emissions).

The question that arises: Is Massachusetts really ready to fill all the openings projected in all these sectors at the same time?

Since our hopes of reducing emissions and reaching our climate goals hang in the balance, a reasonable answer is, we had better, because failure is not an option.

Some may dismiss the subject entirely: not to worry; too many jobs to fill is a good problem to have. Well, maybe. But maybe not; left unaddressed, a mismatch between the number of available jobs and the number of available people can become what scientists call a "rate limiting" factor -- a bottleneck or a brake, in this case on the jobs and the emissions reductions both.

In that event, many of the jobs would likely go somewhere else, while many of the emissions would likely remain.

While the problem seems particularly pronounced in New England, the crux of it may lie in regional, national, and even worldwide trends in blue-collar workforce availability. As one commentator put it, "Not enough young people are entering the sectors, a concern for companies as older workers retire from construction, carpentry and plumbing jobs. And although many skilled trade positions have competitive wages and lower educational barriers to entry, newer generations tend to see a four-year college degree as the default path to success."1

All this said, we want to emphasize that what we're observing so far in Massachusetts is not conclusive. Methodologies for estimating workforce needs are inconsistent across the five segments. Often the only decent data is national rather than Massachusetts-centric. For these reasons and others, what we've uncovered so far amount to nagging data points, suggestive signs, recurring patterns -- the kinds of things that get your attention and then get you worried.

Still, red flags are not enough. We need the whole picture. Our hope is that the Massachusetts Clean Energy Center, with input from the Executive Offices of Energy and Environmental Affairs, Housing and Economic Development, and Labor and Workforce Development, will undertake a truly comprehensive assessment of, and instigate a comprehensive response to, the problems we anticipate in the five clean energy areas that concern us here:

Energy efficiency. At an estimated 76,900 jobs, reducing energy consumption and greenhouse gas emissions in the design, construction, reconstruction, maintenance, and operation of buildings and building systems is the largest energy sector in Massachusetts.2 The state has an estimated 2.65 million buildings, of which 107,000 are commercial and industrial and 2,400,000 are residential, 3 and the unmet need for energy efficiency services is considerable. The biggest part of this is heating, ventilation and air conditioning (HVAC).4 The individuals who do HVAC work are, as a practical matter, drawn from the pool of people who work in construction.5 What should concern us: Retrofitting Massachusetts homes with the HVAC systems needed to meet the Climate Act's 2025 and 2030 sublimits for residential emissions will necessitate our filling an estimated 35,600 additional HVAC jobs by 2030.6

Solar installations. Nationally, 231,474 people worked in the solar industry in 2020.7 The industry is on track to reach 400,000 solar jobs by 2030 but this is not close to being enough; if we're to reach President Biden's goal of 100% clean energy by 2035, we will need to have filled 900,000 solar jobs by then.8 What should concern us: Massachusetts is counting on installing 3.2 megawatts of solar by 2030 and obtaining the equivalent of another 1.0 megawatt of clean hydro power via transmission from Quebec.9 At the moment, we're not up to the challenge. In 2015, 15,095 people had Massachusetts solar jobs.10 Then followed five years of decline; by 2020, our solar head count was down to 9,495.11 Meanwhile, the drive to bring clean hydro power down from Quebec has run into serious trouble. If hydro's fortunes do not reverse, solar (and wind) production will have to pick up the slack. Unlike out-of-state hydro, solar and wind are labor-intensive locally. This means the solar workforce will need to not only get back to full strength but see additional growth. As with energy efficiency, individuals who do solar installations are, as a practical matter, drawn from the construction industry,12 further evidence that every clean energy sector will be competing for the same labor pool.

Green transportation. The national infrastructure bill President Biden signed last November includes $66 billion for Amtrak, much of it aimed at improving Northeast Corridor service between Washington and Boston.13 The cash infusion comes at an opportune time. As of December, Amtrak was trying to fill 200 or so open positions and was "struggling to deal with labor shortages," among them "shortages of electricians, machinists, and train operators."14 The same month, the railroad's inspector general warned it was failing to "find and hire qualified candidates."15 What should concern us: As it strains to improve service, lower fares, and finance the switch to low polluting but expensive electric vehicles, the MBTA confronts workforce problems of its own. At the T's repair facility in Everett, "the entire vehicle maintenance team is short more than 100 workers as the agency struggles with hiring."16 There are shortages of bus drivers, too, prompting the agency to reduce the frequency of service.17 The system is set to receive short-term funding for 2022 and 2023 from federal sources and, with it, will "offer new hires one-time bonuses and provide retention bonuses to existing T employees, efforts to address driver shortages that have created headaches and service cuts in recent months."18 But that's short-lived money. Unlike Amtrak, urban mass transit systems like the T do not qualify for the more substantial funding found in the infrastructure bill. Even so, to return to full-scale operations in a post-Covid world, the T must find workers to fill vacant positions.

Power transmission restructuring. Transmission systems move electricity; windmills generate it. Members of the building trades construct both. The infrastructure act signed by President Biden last November allots $65 billion to upgrade the grid,19 a process aimed at creating "good-paying jobs for union laborers, line workers, and 6 electricians."20 What should concern us: Massachusetts-specific numbers are hard to find but, nationwide, "The average age of US utility workers is over 50, several years older than the national average. This means that a large percentage of the utility workforce will retire in the coming years, and not enough skilled workers will exist to fill the gap. Many utilities are already grappling with vast retirements."21

Offshore wind. In Massachusetts, and in competition with other states up and down the East Coast, the offshore wind sector anticipates major hiring over the next several years, drawing from the same well of blue-collar workers as the energy efficiency, solar installation, green transportation, and power transmission sectors. The number of jobs that will need filling at any one time is hard to determine, in part because wind developers appear to have taken up the practice of talking in terms of "job years" rather than actual jobs.22 An added complication is that jobs at the construction and installation phase of wind projects draw much of the Legislature's interest, yet aren't permanent, typically lasting two to five years.23 What should concern us: With respect to construction, assembly and installation, analysts find "an insufficient number of available [Massachusetts] workers in key occupations."24 Specifically, "the state is … least prepared to meet construction and assembly needs."25 Even more specifically, it has "insufficient availability of construction laborers, transportation workers, and general maintenance workers."26 As for the prospect of filling in the ranks by reaching out to local residents in search of a job, analysts foresee "no excess of short-term unemployment to fill current and future job openings."27

There is a larger context.

 

There is a larger context to these industry-specific observations, but the takeaway is much the same. Nationwide, "investors and Federal Reserve policy makers now consider the labor market to be at or near full employment, despite the fact that the economy has only recovered about 84% of the jobs it had before the pandemic. The labor force has shrunk, and with the unemployment rate now at 4%, the Fed is shifting gears from providing stimulus to the economy to fighting inflation while trying to maintain the labor-market recovery."28

Here in Massachusetts, one of the economy's most significant overall problems is a shortage of prospective employees. "Local companies, particularly in sectors like technology, manufacturing, and health care, are leaving business on the table because there aren’t enough skilled workers available to hire. … 'I think the biggest issue facing 7 the state is this binding constraint of slow labor force growth,' said Robert Nakosteen, a professor at the University of Massachusetts Amherst."29

More specifically, "It’s almost like Massachusetts has too many biotechs. The industry is hotter than ever …. But the pipeline of qualified workers to fill all of the added jobs can’t keep up with the burgeoning demand."30

As we read through trade association reports, consultants' analyses, and journalistic investigations, we note a relentless consistency. There is the good news (and it truly is good news): the climate economy of Massachusetts will generate plenty of job openings. There is also the rest of the news, evident from all of the above: how, and to what extent, these openings get filled is an unresolved question.

Challenges notwithstanding, the future is ours to shape.

Unresolved does not mean unresolvable; the future is ours to shape. Job training will be necessary but not sufficient. Other options must be on the table.

The very first step: ideally with guidance and assistance from the Executive Offices of Energy and Environmental Affairs, Housing and Economic Development, and Labor and Workforce Development, the Massachusetts Clean Energy Center should properly scope the full extent of the challenges ahead.

Together with our legislative colleagues, we want to see the Commonwealth's climate economy take off. To repeat a point for emphasis, our hopes for reducing emissions and reaching our climate goals hang in the balance. Failure is not an option.

Sincerely,

Michael J. Barrett, Senate Chair, Joint Committee on Telecommunications, Utilities and Energy

Cynthia Stone Creem, Chair, Senate Committee on Global Warming and Climate Change 

Eric P. Lesser, Senate Chair, Joint Committee on Economic Development and Emerging Technologies

Patricia Jehlen, Senate Chair, Joint Committee on Labor and Workforce Development

cc:Jeffrey Roy, House Chair, Joint Committee on Telecommunications, Utilities & Energy

Jerald Parisella, House Chair, Joint Committee on Economic Development and Emerging Technologies

Josh Cutler, House Chair, Joint Committee on Labor and Workforce Development

 

 

 

 

1 Madeleine Ngo, "Skilled Workers Are Scarce, Posing a Challenge for Biden's Infrastructure Plan," New York Times, Sept. 9, 2021, updated Nov. 6, 2021.

2 E2 (Environmental Entrepreneurs), E4TheFuture, and BW Research Partnership, Energy Efficiency Jobs in America 2021, Massachusetts factsheet (October 2021).

3 MassGIS analysis of parcel data submitted by local assessors. Communication with Barrett staff, September 12, 2019. 132,000 additional buildings fall into a Miscellaneous category -- recreational structures, structures on tax-exempt properties, etc.

4 Energy Efficiency Jobs in America 2021, Massachusetts factsheet (October 2021), above.

5 National Association of State Energy Officials, 2020 U.S. Energy & Employment Report, Key Findings: Energy Efficiency.

6 Energy Efficiency Jobs in America 2021, Massachusetts factsheet (October 2021), above.

7 Solar Energy Industries Association, the Solar Foundation, and the Interstate Renewable Energy Council, National Solar Jobs Census 2020 (May 2021), slide 5.

8 National Solar Jobs Census 2020, immediately above, slide 17.

9 Commonwealth of Massachusetts, Executive Office of Energy and Environmental Affairs, Interim Clean Energy and Climate Plan for 2030, Dec. 30, 2020, table on page 37.

10 Sarah Shemkus, "Massachusetts solar jobs growing again, but not as quickly as national average," Energy News Network, March 11, 2020.

11 National Solar Jobs Census 2020, above, slide 14.

12 National Solar Jobs Census 2020, above, slide 8.

13 Madeleine Ngo, "Billions in Amtrak Funding Could Modernize Aging Rail System," New York Times, Dec. 20, 2021.

14 Madeleine Ngo, immediately above.

15 Madeleine Ngo, immediately above.

16 Taylor Dolven, "Still no improved Mattapan trolleys nearly five years after $7.9m MBTA investment announced," The Boston Globe, Jan. 2, 2022.

17 Taylor Dolven, "T says it doesn’t have enough drivers, will have to cut bus service starting Dec. 19," Dec. 7, 2021.

18 Chris Lisinski, "MBTA Outlines Far-Reaching $500 Mil Spending Plan," State House News Service, Jan. 27, 2022.

19 Ellie Long, "Here's How The Infrastructure Bill Improves the Grid," Alliance To Save Energy, Nov. 22, 2021.

20 The White House, Fact Sheet: The American Jobs Plan, March 31, 2021.

21 Chris Testa, Post: "The Graying Utility Workforce," Energy Central, Aug. 10, 2020.

22 Doug Fraser, "Harnessing the Wind: Blowing away the competition," Cape Cod Times, Oct. 21, 2021; Lori Robertson, "White House Uses 'Job-Years,' Not Jobs, to Tout Infrastructure Law," FactCheck.org, Nov. 18, 2021.

23 Massachusetts Clean Energy Center, "Offshore Wind Workforce Training & Development in Massachusetts," page 9 (Sept. 2021).

24 Massachusetts Clean Energy Center, immediately above, page 21.

25 Massachusetts Clean Energy Center, page iii.

26 Massachusetts Clean Energy Center, page 21.

27 Massachusetts Clean Energy Center, page 27.

28 Gabriel T. Rubin, "U.S. Labor Costs Grew at Fastest Pace in Two Decades," Wall Street Journal, Jan. 28, 2022.

29 Greg Ryan, "Leaving Massachusetts: Greater Boston has a people problem," Boston Business Journal, Feb. 7, 2020.

30 Anissa Gardizy, "In the region's booming biotech industry, workers are in short supply," Boston Globe, Jan. 30, 2022.