Are more solar jobs a good thing?

This op-ed appeared March 17, 2018 in the St. Cloud Times. 

In 2017, according to new figures from the Solar Foundation, employment in the U.S. solar energy industry declined by 4 percent or 9,800 jobs, the first fall since it began tracking jobs in 2010. But Minnesota bucked the national trend. Here, solar employment grew by 48 percent, to 4,256 jobs. Only Delaware had a faster growth rate.

Isn’t that a good thing? Well, that depends. The essence of economic growth is increased productivity: producing a larger amount of outputs from a given amount of inputs. More output per head is how we get better off. The point is to grow output, not inputs.

So, while these numbers for employment tell us about the amount of labor input in solar energy, they do not tell us about output. And when we look at the ratio of inputs to outputs, solar energy fares very, very badly indeed.

Last year, Mark J. Perry of the American Enterprise Institute noted that the 400,000 solar workers accounted for about 20 percent of electric power payrolls in 2016 but that the sector produced less than 1 percent of the electric power generated in the United States that year. By contrast, about the same number of natural gas workers (398,235) managed to produce more than one-third of U.S. electric power, or 37 times more electricity than solar’s minuscule share. Coal performed even better. With only 160,000 coal workers, less than half the number of workers in either solar or gas, that sector produced nearly one-third (almost as much as gas) of U.S. electricity in 2016.

By contrast with coal and gas, solar energy does a very poor job of turning labor inputs into energy outputs. In 2016, coal generated an average of 7,745 megawatt hours of electric power per worker. This was more than twice the 3,812 megawatt hours of electricity generated per natural gas worker, and 79 times more electric power per worker than the solar industry, which produced only 98 megawatt hours of electricity per worker. To produce the same amount of electric power as just one coal worker would require two natural gas workers and 79 solar workers.

This is not to write the solar energy industry off. But it is to say that increasing numbers of people employed in it might not be a good thing. After all, the point of an energy industry is to generate energy, not to generate jobs. If it was, we could hire people to stand in front of wind turbines blowing at them to make them turn faster. The effect energy generation would be non-existent but the effect on employment need only be limited by how many blowers we can fit in a field, and Minnesota has a lot of fields.

This is the opinion of John Phelan, an economist at the Center of the American Experiment in Golden Valley.