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Green Jobs

Myth or Pathway out of Poverty?

By Elena Foshay

I wrote an article in 2010 about the potential for increased investment, largely stimulated by the American Recovery and Reinvestment Act of 2009, in energy efficiency to create, in the construction industry, high-road jobs that were stable, paid good wages, and provided benefits.1 At that time the depths of the recession were taking their toll on all Americans, particularly the most economically vulnerable. Investments under the Act brought to the forefront the idea that a clean-energy economy could create new opportunities that would “lift all boats.” Expectations were high, and workforce development programs ramped up in anticipation. The idea that green jobs could create a pathway out of poverty resonated with many and opened up hope for a way out of economic despair. But did the dream of green pathways out of poverty pan out?

Green Path

The American Recovery and Reinvestment Act did propel the clean-energy economy forward, and the Act had a net positive impact on employment. But while jobs were created, the numbers were not enough to make a significant dent in unemployment. Not all of the jobs created were good jobs, including many of those that were the primary targets of green job training programs. Because of a mismatch between training and jobs, many graduates of green job training programs were left with frustratingly limited employment prospects.

Ultimately the American Recovery and Reinvestment Act did not pave a pathway out of poverty for the millions who continue to be left out of the economic recovery. Even now, when the overall unemployment rate is at its lowest since 2010, those who were already economically disadvantaged at the start of the recession still feel its impact.2 African Americans and Latinos are still disproportionately poor, and, with disproportionately low levels of educational attainment, they find fewer opportunities for well-paid, career-track employment. Persistent barriers to employment continue to inhibit many from entering the labor force or moving beyond low-wage jobs.

If we do it right, we will build a clean-energy economy offering good jobs—a true pathway out of poverty.

Despite these challenges, a broad strategy that continues to invest in the clean-energy economy still represents the best hope we have both to build resilience against the impact of climate change and to create American jobs. And if we do it right, we will build a clean-energy economy offering good jobs—a true pathway out of poverty. Here I briefly assess the impact of the American Recovery and Reinvestment Act on green jobs and the continued potential for job growth. In an era of much uncertainty at the federal level, I offer a series of recommended actions that can be implemented at the local level to create a good-jobs economy by expanding clean-energy investments and ensuring that those investments benefit disadvantaged communities by creating equitable access to economic opportunity.

Impact of the American Recovery and Reinvestment Act on Green Jobs

Despite the downturn in the U.S. economy, 2009 was a hopeful time for clean-energy advocates. The largest public investment our economy had seen in generations included over $92 billion to support energy efficiency, renewable energy, and clean technologies, with the promise of creating more than 300,000 jobs.3 The American Recovery and Reinvestment Act clean-energy investments created many opportunities for American workers. Estimates of the Act’s job creation results vary widely, but all imply a positive net impact on employment. A 2014 report by the Congressional Budget Office estimated that between 1.5 million and 8.4 million jobs were created by the Act.4 In its 2010 quarterly report on the economic impact of the Act, the U.S. Council of Economic Advisors estimated that 224,500 jobs had been created or retained by public investments in clean energy.5 According to the Council of State Governments, green jobs represented more than 14 percent of all jobs created by the Act in 16 states.6

One of the standout components of the American Recovery and Reinvestment Act was a specific investment in workforce development initiatives targeting green jobs, with the idea that such initiatives would help low-income individuals and those with barriers to employment access this growing field of new opportunities.7 A total of $500 million in funds went to the U.S. Department of Labor to support green workforce development, including $150 million for Pathways out of Poverty training programs.8 Funds were distributed quickly, in some cases to existing programs adding new skills to their training and in other cases to create new training programs targeting green industries such as weatherization and solar installation.

But just a few years after those dollars hit the ground, many labor unions and green-jobs advocates felt burned—the jobs did not materialize in the numbers expected, and employers still said they could not find people to fill open positions, while graduates of green job training programs continued to struggle to find work.9 The U.S. Government Accountability Office found that of those trained through programs funded under the American Recovery and Reinvestment Act, only 55 percent were placed in employment.10 Pathways out of Poverty programs, in particular, failed to remove the challenges faced by adults with barriers to employment.

Despite these results, and having propelled forward the idea of a clean-energy economy that could create economic and employment opportunities in every state, the American Recovery and Reinvestment Act’s vestiges remain, particularly at the state and local level. More important, the Act was a proving ground to test new program ideas and investment models, many of which, with some variation, continue to this day.

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Americans Left out of the Recovery

While the economy has bounced back and unemployment is at its lowest point since 2010, some Americans continue to be left behind. The recession only intensified economic instability among disadvantaged populations. The overall unemployment rate at the peak of the recession in October 2010 reached 10 percent, but for Latinos it was 13 percent, and for African Americans it was 16 percent.11 Today at 7.7 percent the unemployment rate for African Americans is close to double that of whites, and for Latinos it is 5.9 percent.12 The rate increases when including those who want a job but do not have any and workers who would like to be working full-time but are forced to accept part-time jobs.13

The recession widened the racial wealth gap.14 At the peak of the recession in 2010, the poverty rate for whites was 9.9 percent, compared to an astonishing 26.6 percent for Latinos and 27.4 percent for African Americans.15 After the recession, black wealth, excluding home equity, was down more than 40 percent, and this has a lasting impact on black families’ long-term financial stability.16 And job training programs did not succeed in closing the gap in educational attainment. Of African Americans 13 percent, and of Latinos more than 30 percent, still lack a high school diploma.17 Such low educational attainment severely limits employment prospects—individuals without a high school diploma suffer unemployment at more than three times the rate of those with a college degree.18 A number of Americans need alternative pathways to training and education that lead to quality employment and career advancement.

Green Jobs as an Opportunity

To track the jobs impact of clean-energy investments under the American Recovery and Reinvestment Act, the U.S. Bureau of Labor Statistics defines green jobs as either (1) “[j]obs in businesses that produce goods and provide services that benefit the environment or conserve natural resources” or (2) “[j]obs in which workers’ duties involve making their establishment’s production processes more environmentally friendly or use fewer natural resources.”19

Median wages for clean-energy jobs are 13 percent higher than median wages across the broader economy.

In 2011, the last year for which green jobs numbers have been reported, the Labor Department estimated that there were 3.4 million green jobs, accounting for 2.6 percent of total U.S. employment.20 A majority of these jobs fell into two broad industry sectors: construction and manufacturing. Approximately 2.7 million workers are directly employed in clean power generation and distribution, energy efficiency, and alternative-fuel vehicles.21 Energy efficiency in particular supports 30 percent of all U.S. construction jobs, having approximately 1.2 million workers.22

But these numbers are just estimates. The greatest challenge in tracking green jobs was that few stand alone as entirely green. As clean energy becomes more mainstream, green technologies and processes are increasingly becoming part of a much wider variety of jobs across most industry sectors. Indeed, most work contributing to the clean-energy economy falls under more traditional occupations.

Many of those individuals working in both residential and commercial construction, for example, need to understand green technologies and building techniques as building codes increasingly require minimum energy- and water-saving standards and as LEED (Leadership in Energy and Environmental Design), Energy Star, and Net Zero buildings become more popular. Wastewater treatment operators are fundamentally involved in recapturing and recycling a basic resource, and many work at plants with biogas and other renewable generation systems. Public transit operators are increasingly crucial in helping reduce our consumption of fossil fuels, even though the job itself has not much changed. As utilities increase investment in renewable power generation, more workers will spend all or part of their time installing and repairing renewable power generation systems. Many more traditional and specialized jobs contribute to the clean-energy economy.

A majority (57 percent) of clean-energy jobs are middle-skill jobs, that is, they require more than a high school diploma but less than a college degree, or low-credentialed jobs with decent earnings potential.23 Clean-energy jobs tend to be better jobs; according to the Brookings Institution, median wages for clean-energy jobs are 13 percent higher than median wages across the broader economy.24 Clean-energy jobs present an opportunity for individuals who do not have the time, money, or ability to pursue a college education to access well-paid, career-track jobs that contribute positively to the environment.

We need an aggressive, national job-creation strategy that will simultaneously improve environmental and economic sustainability and build resilience against the impact of climate change.

Experts anticipate that the number of clean-energy jobs will continue to grow.25 The construction industry alone is expected to add almost 700,000 jobs over the next decade, with more than 200,000 of those jobs directly involved in energy efficiency.26 Wind turbine service technician is projected to be the fastest-growing occupation over the next decade, with an average wage of $51,050.27 Median wages for solar (photovoltaic) cell installers were $18.19 hourly in 2015, with projected growth of 24 percent over the next decade.28 Weatherization installers and technicians earn $17.45 hourly on average and will see job growth of between 5 percent and 8 percent over the next decade.29 Energy auditors earn more than $32 hourly on average and will see an increase of almost 167,000 jobs over the next decade.30 None of these jobs requires a college degree.

Although union membership is declining across the board, unions still represent a significant portion of the primary industries involved in clean energy. Current estimates are that unions represent 10 percent of manufacturing workers, 15 percent of all construction workers, and more than 20 percent of transportation and utility workers.31 Union jobs are good jobs—union members earn, on average, 25 percent more than their nonunion counterparts.32 Across all building trades, union members are aging, with nearly half of all union members reaching retirement age in the next two decades.33 Retirements open an entry point for a younger and more diverse workforce to access the quality and security offered by union membership.

With much uncertainty around national support for clean energy, strong state-level policies will form the backbone of the clean-energy economy.

Building a True Pathway out of Poverty

We need an aggressive, national job-creation strategy that will leverage the momentum created by the American Recovery and Reinvestment Act, simultaneously improving environmental and economic sustainability and building resilience against the impact of climate change. If federal agencies fail to take action, state and local governments must use their power to push this job-creation strategy forward at the local level and intentionally ensure job quality and job access to guarantee that such jobs as created are truly a pathway out of poverty.

Action 1: Increase the Overall Number of Jobs by Continuing to Invest Aggressively in Clean Energy. Investing in clean energy is an effective job-growth strategy because it generates broad economic benefits. For every $1 million in clean-energy investments, an estimated 16.7 jobs are created, compared to 5.3 jobs per $1 million invested in fossil fuel industries.34

With much uncertainty around national support for clean energy, strong state-level policies will form the backbone of the clean-energy economy. Policies such as “renewable portfolio standards” and “energy efficiency resource standards” are critical and should continue to revise goals to be more aggressive. A report by the University of California, Berkeley, Labor Center estimates that between 2002 and 2015 California’s renewable portfolio standard led to the creation of 25,500 blue-collar job-years and 7,200 white-collar construction job-years.35 Most of these projects were governed by collectively bargained project labor agreements, which require benefits, prevailing wage rates, and employer contributions toward training. State and regional greenhouse gas reduction plans that include cap-and-trade programs, such as the Regional Greenhouse Gas Initiative and California’s AB32, generate significant revenue that can be invested in clean energy and job training. States should also continue to support ratepayer-funded energy efficiency and renewable energy programs and initiatives.

Investments in reducing carbon emissions should target the most environmentally harmed and socioeconomically disadvantaged communities.

Action 2: Make Sure that Clean-Energy Investments Specifically Benefit Those Communities that Will Be Hardest Hit by Climate Change. Investments in reducing carbon emissions should target the most environmentally harmed and socioeconomically disadvantaged communities.36 Specifically, climate policies should apply an equity framework, prioritizing environmental justice, economic equity, and public accountability. Clean-energy investments should support both environmental and economic sustainability, simultaneously reducing environmental health risks and increasing community-level resilience.

One example is California’s S.B. 535, a law that requires 25 percent of state cap-and-trade revenues to benefit disadvantaged communities, with 10 percent of funds being directly invested in those communities.37 Disadvantaged communities are defined by using the California Communities Environmental Health Screening Tool, which assesses burden and vulnerability to pollution by census tract.38 The first round of funding, totaling $272 million, supported projects in clean transportation, energy efficiency and renewable energy, affordable housing, urban forestry, public transit, and intercity rail.

Action 3: Ensure that Clean-Energy Jobs Are Good Jobs by Applying Wage Standards, Guaranteeing Access to Basic Benefits, and Enforcing Worker Protections. Many tools can be applied to both public and private investments to ensure that clean-energy jobs are good jobs.39 Project labor agreements and community workforce agreements ensure that any project subsidized by public or ratepayer investment pays decent wages and provides benefits for workers. Responsible contractor policies help screen out businesses that exploit their workers by paying low wages and having poor working conditions. “Best value contracting” is often used by public agencies to prioritize sustainability in their purchasing decisions and can be used to prioritize purchasing from vendors that pay living wages and provide benefits to their workers.

Union jobs are good jobs because they offer living wages and benefits to members, and clean-energy investments can expand union work. At the same time all workers, including those who are not part of a union, should have basic benefits such as paid sick time and health insurance. Only 7 states, 29 cities, 2 counties, and Washington, D.C., guarantee paid sick leave for workers.40 Those workers not covered by these laws lose income and risk losing their jobs any time they must miss work due to illness or caring for a family member. Health insurance is also a basic benefit that all workers should enjoy. In 2014 the uninsured rate in construction reached a historically low level at 25.2 percent but remained the highest among major industries.41 Almost half of Hispanic construction workers remain uninsured.42 Many workers who are not union members or do not have health insurance through their employer have insurance today, thanks to the Patient Protection and Affordable Care Act. Access to health care insurance must be maintained, and insurance rates for individuals and small businesses must be kept low.

Action 4: Ensure Access to Employment Opportunities Through Participation and Targeted Hiring Requirements. Minority business participation and targeted hiring requirements are a critical component in guaranteeing that local and disadvantaged residents benefit from clean-energy investments. These requirements are not new—many public projects include them as a way to ensure equitable public benefit. For example, the Section 3 program in the U.S. Department of Housing and Urban Development (HUD) “requires that recipients of certain HUD financial assistance … provide job training, employment, and contract opportunities for low- or very-low income residents in connection with projects and activities in their neighborhoods.”43

Minority business participation and targeted hiring requirements are a critical component in guaranteeing that local and disadvantaged residents benefit from clean-energy investments.

In another example, the U.S. Department of Transportation requires that 10 percent of funding be expended with “disadvantaged business enterprises,” defined as those owned by individuals, including women and racial minorities, who experience social or economic disadvantage.44 Many states, cities, and counties have similar policies that apply to their contracting processes.

Many policies such as these allow requirements to be sidestepped through “good-faith effort,” which is a gray area that often requires minimal verification. To make participation requirements more effective, sufficient resources must be allocated toward maintaining up-to-date lists of certified contractors, as well as conducting outreach to identify businesses to be added to the lists. Resources must also be invested in enforcing participation requirements to hold both contractors and public agencies accountable.

Another key strategy is to build in strong targeted hiring requirements. California has some excellent examples of such requirements. For example, the Alameda County Project Stabilization/Community Benefits Agreement requires that local residents work 40 percent of all hours on county-funded construction projects.45 It requires that contractors hire at least one disadvantaged first-stage apprentice for the first $1 million of construction and one more for each successive $5 million. Disadvantaged workers are defined as “Alameda County residents who are at least one of the following: household income below 50% of Alameda County median; or non-minor dependent youth/emancipated foster youth; or welfare recipient; or involvement with criminal justice system; or unemployed; or single parent; or homeless.”46

A second example is the project labor agreement for the redevelopment of the Oakland, California, Army Base, which included a construction jobs policy with strong local and targeted hiring goals.47 Of both construction and operations work hours 50 percent must be performed by Oakland residents.48 Of work hours 20 percent must be performed by apprentices, 5 percent to 10 percent of which must be performed by new apprentices, and all new apprentices must be Oakland residents, with priority given to graduates of Oakland pre-apprenticeship programs.49 Additionally 25 percent of apprentice hours should be completed by disadvantaged workers, defined as individuals who are formerly incarcerated, low-income young adults, or disabled.50

Any targeted hiring requirement is only as valuable as the built-in monitoring and enforcement mechanisms. Key questions are how city of residence, race, gender, and any disadvantageous characteristics are tracked and to whom they are reported. An independent group must be designated to monitor data and must have the ability to hold contractors accountable to meeting those goals. To remedy any violations, contractors should be given options, such as hiring targeted populations to work on other projects for an equivalent number of hours.

Action 5: Adequately Prepare Disadvantaged Populations for Success in the Clean-Energy Workforce. Union jobs offer the best opportunity for good pay and benefits and a lifelong career. But entry into union apprenticeships continues to be challenging for many low-income individuals, particularly those with barriers to employment. Many apprenticeship training centers are located outside urban centers and are not easily accessible by public transit. To begin training, programs often require a valid driver’s license and a basic set of tools or safety equipment or both. The application process can be lengthy, and some programs require a high score on a math or mechanical reasoning test in addition to an intimidating panel interview. Other apprenticeship programs require employer sponsorship, which requires an individual to find a job before beginning training. Facing sexism and discrimination at every step, women continue to face particular challenges in entering and completing apprenticeships.

Pre-apprenticeship programs are bridges to apprenticeships for individuals with barriers to employment and for women seeking to enter nontraditional careers. These programs usually combine basic math and literacy skills training with hands-on construction skills, OSHA (Occupational Safety and Health Administration) 10 certification, soft skills training, and case management, with the goal of placement into a union apprenticeship. Pre-apprenticeships can be bridges to apprenticeships, but no national standard ensures the quality of the training or guarantees placement results. The Multi-Craft Core Curriculum is a new combined effort led by the National Building and Construction Trades Council to teach core skills that apply to multiple trades. Pre-apprenticeship programs must be approved to offer the Multi-Craft Core Curriculum, and part of the requirement is a direct connection to building trades apprenticeships.

The Multi-Craft Core Curriculum is valuable in ensuring quality standards for pre-apprenticeships, but individual trades still determine what value to place on the certification earned by graduates. A national standard for pre-apprenticeship programs would help ensure that the training is effective and that it is valued by apprenticeship programs nationwide. As green technologies increasingly become part of more traditional careers, basic eco-literacy and hands-on experience with green techniques and technologies should become part of all training programs. Any pre-apprenticeship program serving low-income adults and those with barriers to employment must include earn-and-learn opportunities to help support participants in completing all training requirements.

One of the great lessons learned from workforce-development investments under the American Recovery and Reinvestment Act is that training must be directly tied to job openings and should incorporate significant amounts of hands-on and on-the-job experience.51 Strong relationships with employers are key to any job training program. Employer partners should give input on curriculum design, value the certification or credential earned by program graduates, and offer direct hire employment opportunities after training is complete.

Action 6: Address Persistent Barriers to Employment. Another key component of job access is tackling some of the most persistent barriers to employment. One of those barriers is the lack of a driver’s license, a basic requirement for many jobs, particularly in the construction sector. One California study found that four million people, or 17 percent of the adult population, had a suspended license for failure to appear in court or pay fines.52 Those living in poverty are stuck in a cycle of unpaid fines they cannot escape. For an individual seeking employment, not having a driver’s license severely limits the type and quality of jobs available. To lower this barrier, California enacted an amnesty program that allowed low-income individuals to reduce their unpaid fines by up to 80 percent and get their driver’s license back. Similar programs should be enacted nationwide, with sufficient resources to handle the large numbers of individuals with suspended licenses.

An estimated one in four adults has a criminal record, and one in three African American men and one in six Latino men will serve time on a criminal sentence.53 For individuals with a criminal record, many jobs in the clean-energy economy are inaccessible. The stigma equating hiring people with criminal backgrounds with risk is real, but the reality is that most arrests and convictions are for old or minor offenses that pose no risk in the workplace.54 Evidence also shows that information contained in criminal background checks can be out of date or incorrect.55 According to the U.S. Equal Employment Opportunity Commission, criminal background checks are tantamount to discrimination, particularly when the offenses that prohibit individuals from being hired do not relate to the job they will perform.56 President Obama’s “ban-the-box” initiative sought to eliminate criminal background checks on all federal hiring as well as private-sector hiring on federally funded projects.57 This effort should be approved and expanded to encourage all employers to eliminate unnecessary background checks. Where they are necessary, a waiver process should be put in place: individuals who have a criminal background and can demonstrate rehabilitation, by completing a recognized job training program, for example, would still be eligible for employment.

Even when a criminal background is not an issue, African American applicants to entry-level jobs continue to face discrimination in hiring.58 Indeed, almost one in two Hispanics (49 percent) and African Americans (46 percent) say they have trouble getting a good-paying job or a raise compared to one in three (32 percent) whites.59 To combat implicit bias among employers, training programs should actively build in opportunities for participants and employers to have positive interactions.60 Facilitated networking events, working side by side on job sites, and other such opportunities allow individuals to know one another’s strengths and assets. Job-placement experts know that around 80 percent of jobs are found through networking, and personal relationships increase the likelihood that those making decisions will challenge assumptions and overcome implicit bias.

While we do not yet know what will happen to clean-energy investments at the national level under the new administration, momentum at the state and local level continues to accelerate. Cities and states nationwide are committed to both preventing and mitigating the impact of climate change and building resilience, particularly among communities that will be hardest hit. Support for clean energy is ultimately an economic and job-growth strategy—let us make sure it truly lifts all boats.

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