The Importance of Public Policy in a Tight Labor Market

Will the US clean-energy transition be hampered by a shortage of electricians, plumbers, and skilled construction workers? In this episode, Betony Jones, director of the DOE’s Office of Energy Jobs, talks about the challenge of bringing a clean energy workforce to full capacity and the need for job opportunities in communities impacted by diminished reliance on fossil fuels.

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David Roberts

Now that the Inflation Reduction Act has lit a fire under the clean-energy transition, a new worry has begun to emerge: can the US create the workforce it needs to build all of this stuff? And can it care for the fossil fuel workers who are displaced in the process?

Across the trades that will be necessary to build out clean energy — electricians, plumbers, construction — industries are reporting worker shortages. Meanwhile, entire communities are being disrupted and displaced by the closure of refineries and other fossil fuel facilities.

What can the government do to help growing industries create the job pipelines they need? And what can it do to help cushion the blow to fossil fuel communities?

To get to the bottom of these questions, I contacted Betony Jones, the director of the Office of Energy Jobs at the Department of Energy. She has spent years thinking about clean-energy workforce issues and working with industries to create shared job training and apprenticeship programs. We talked about the jobs that are coming, the jobs that are going away, and the need for an active hand in smoothing the transition.

With no further ado, Betony Jones. Welcome to Volts. Thank you so much for coming.

Betony Jones

It's great to be here. Thank you.

David Roberts

You know, ever since the Inflation Reduction Act passed and the rest of the legislation sort of like kicking off a new era of clean energy acceleration, I've been thinking about what are the remaining kind of now the policy log jam has broken, what are the remaining impediments? What are the remaining dangers? And I've sort of narrowed it down to the four Horsemen. The four or four horsemen of the clean energy apocalypse political blowback, which is basically Republicans taking back over and undoing everything NIMBYism, which is the difficulty of building all the things we need to build interconnection queue and transmission i.e. making the grid big and robust enough. And then, fourth, workforce issues. I'm going to try to do a pod on all these eventually, but we're here to talk about workforce issues. So just by way of background, maybe start by telling us what your office is and what it's for and what it's intended to do.

Betony Jones

First, I just want to say when the Inflation Reduction Act passed, that was really game changing for someone like me who's been working at the nexus of climate change and labor issues for so long. And so to answer the question of what my office does, the Office of Energy Jobs at the U.S. Department of Energy is responsible for a few things, but one of them is making sure that the jobs that are being created from these historic investments are good, quality, family sustaining jobs that people want. And so writing the rules around the funding and how it goes out the door and how it's made accessible.

David Roberts

Was the office created by Biden, or has this been around a while?

Betony Jones

This iteration was created by Biden, but it has also been around for a while. I think Obama had an Office of Energy Jobs, and so did President Trump. But our office is really focused on, first and foremost, making sure that the investments are getting out into communities, that the investments are creating broadly shared prosperity and good jobs for American workers, and that we're investing in new industries in the domestic supply chain to provide the materials and equipment for this clean energy transition. So that's really exciting. It's actually just an absolutely incredible opportunity to show that we can address the climate crisis while creating real material benefits for American workers.

David Roberts

Yeah, you're really at the nexus there. That's a white hot area. So when I think about workforce issues and the clean energy transition, there's sort of two sides of it. There are the people in communities who are going to lose fossil fuel based jobs, and then there are the people in communities that are going to gain clean energy jobs. I want to start with the latter, although we will return to the former later. So there's all this work to be done electrifying and everything else. But I wonder, do we have a clear quantitative understanding or projection or good models or a sense of exactly what the job shift is going to be? I.e. Like how many jobs are going to be created in what industries, how many will be lost in what industries, or is there so much uncertainty that we're sort of adapting as we go?

Betony Jones

There's always uncertainty because nobody can tell the future. I mean, my office puts out the U.S. Energy Employment Report every year, which is a backward look at energy jobs. And we can see some trends in that backward look. But in terms of forecasting, that's really challenging to do. For the bipartisan infrastructure law, it's difficult to determine where exactly some of these investments are going to take place because for the Department of Energy and most of the energy investments, they're competitive. And so different private sector companies compete for funding, and then they decide where it is that they want to build their hydrogen hub or their battery factory or what have you.

And so it's hard to determine exactly where those jobs are going to be. But we do know that a lot of them, and I would say probably 75% of them are in the construction sector. And so this is traditional jobs. This is laborers and operating engineers, the folks who move heavy machinery, earth moving equipment to prepare the ground for these things or drill the geothermal wells. They're electricians, plumbers, pipe fitters, iron workers. These traditional construction occupations. And it's not that different building a battery factory from building a data center or building a hospital, for that matter.

Construction is construction. The jobs that are created are mostly in traditional occupations sort of regardless of the technology that's being deployed. For the Inflation Reduction Act, this is the really game changing legislation because of the way that it's structured with tax incentives, so we expect to see those investments pretty much everywhere. Now, obviously for things like wind and solar geothermal, you're constrained by the location, by the availability of that resource geographically. But if you're building a factory to make solar panels or battery cells or EV charging stations, you're much less constrained geographically. So that's one thing.

I mean, communities all across the U.S. are competing for those types of investments and then at the same time and this maybe gets to the first part of your question there's fossil assets that can be repurposed for some of the things that we're trying to develop now. And so there's a lot of attention on how do we repurpose those fossil assets, these facilities that have grid connections, that have water and other resources, that have a workforce and a community that supports that. So that's another area of focus.

David Roberts

Yeah. The reason I ask is just because a theme I'm going to return to again and again is just the difficulty of guiding this stuff with policy on any sort of macro scale. That's kind of something I want to interrogate a little bit. But as you say, this legislation that Dems passed we expect ought to create a surge of new jobs in the trades, in pretty conventional trades. And yet all I hear or read in the news is the trades telling us that they face a huge shortage of workers, that they can't find new workers, that the pipeline is drying up, that there's like a million jobs for every applicant, et cetera, et cetera.

So I guess I want to know why is that? Clean energy aside, why doesn't — you would think a market like this is what markets are supposed to do, right? Like when demand for something increases, the market produces new supply. So what is going wrong here that we have these shortages?

Betony Jones

Well, a little bit of it is who you're hearing from. So there are employers out there who can't find workers for sure, and then there are others where there's a line out the door for the opening. You have these established firms with some, you know, where a worker feels like there's some reliability. Siemens, for example, or GE, they can generally fill their positions. The other thing is registered apprenticeship and in particular the union apprenticeship programs. I am being told that even now with this historic low unemployment, they have ten times the applicants as they have openings for.

So what that really shows is that people want jobs but they want good jobs. And so if employers are counting on paying yesterday's wages or counting on the labor market from pre-pandemic, then yeah, they're going to struggle to find workers. But the employers that have a good track record, unionized firms, union pathways into construction as opposed to just general construction, but the pathways that provide reliable access to the middle class, the ability to buy a home, to go camping on the weekends, have a garage full of toys, whatever, people want those jobs. And so the more that we can make sure that we're creating those kinds of jobs, jobs that people are excited about, that they want, it shouldn't be a problem to attract workers.

Is there a bit of transitional pain? Sure. But I think that that's okay because we're in a ramp-up. We're at the bottom of a ramp-up phase. And so what's really exciting, I think, is that we have this big boom. This inflation reduction act is really significant, not just in terms of the greenhouse gas emission reductions, which is huge, 40% by 2030. I've been working in climate change for over 25 years, and I never thought that I would see that actually. So it's really significant in terms of the greenhouse gas emission reductions, but it also is significant in terms of its ability to transform our economy and rebuild a lot of these jobs that historically have provided pathways to the middle class for workers without a college degree.

And so the fact that this is all happening so quickly, yeah, it's an abundance of riches and we have to do some work to realign the labor market. But it's also a great opportunity because there's a lot of buzz and it's a really exciting time to get into energy.

David Roberts

That's what kind of breaks my brain, is that on the one hand, we have all this hype, all this talk, all this new legislation, et cetera, et cetera. And then on the other hand, over here you have electricians saying "Hey, we have a graying aging workforce. We don't have enough young electricians. We're falling short here." Trying to fit those two things together in my head is what kind of doesn't compute.

Betony Jones

Well, I think that's exactly where this is an opportunity because, yeah, there is sort of this silver tsunami in the trades, and it hasn't been an area of work that parents have pushed their kids into for a while. And that's also true with manufacturing. But now with these investments tied to actual labor standards that will make sure that these are good career track, family-sustaining jobs, that's going to shift. The promise of a college degree has changed. It's no longer the reliable path to the middle class that it has been. And so we're seeing even people with college degrees going into apprenticeship programs where not only do you not have to take time off work to go get trained because you're earning as you're learning, but there's also no tuition associated.

So you're not going into any debt. You can tomorrow go sign up, get into a registered apprenticeship program. You start earning money immediately. You get to work with your hands. You get to see the fruits of your labor. There's a lot of people actually who want to do that. And so this wealth of investments that we're making really, I think, shows workers, young people or people looking to transition in their careers, that this is a pretty stable area of work to get into, that there's going to be investments for a while. This is a reliable career path, and I think that's really attractive to people.

David Roberts

Yeah. One of the articles I read, it says the Bureau of Labor Statistics estimates that there will be 80,000 job openings for electricians every year until 2031 as we electrify everything. My own 17-year-old son is seriously considering going into the trades instead of college.

Betony Jones

And how do you feel about that?

David Roberts

Because of all the stuff you mentioned, working with your hands, making decent money, not going into debt. And of course, he's like, I don't want Zoom meetings. I don't want cubicles. It's not just that blue-collar life maybe is looking a little better these days, but also that white-collar life is like "ugh". Young people aren't all that excited about it. Yeah, so we're thrilled. Of course, he's a teenager, so we're trying not to act thrilled. But the Bureau of Labor Statistics also says that the manufacturing sector is short 764,000 workers. So just catching up from that deficit plus all the new growth prompted by IRA to me just says that these labor markets, these particular labor markets in the trades, are going to be tight for a long time.

Betony Jones

They're going to be competitive for a long time. They're going to be competitive. And I think they'll compete with other sectors for workers like warehousing or the service sector. These sectors that have traditionally relied on low-wage labor are probably going to feel a bit more of a pinch than they have for decades, because now there's manufacturing and construction work that have the ability to pay more, be more stable, be more rewarding.

David Roberts

But I see you would think if you're a company in one of these areas and you're short on workers and you're competing for workers, one of the things you could do to compete for workers would be to make the jobs higher paying union jobs. And you would think that would attract people. And yet it just doesn't seem like that's spontaneously occurring to many companies. Instead, they're complaining to the press about entitled workers and asking the Fed to raise interest rates to weaken the labor market. What would it take? And now you're here basically saying it's got to be policy forcing, basically, or using incentives and tax credits to force these companies to make these decent jobs.

Why is it just habit of having crappy jobs in these sectors in the US? Like, what is it with US employers and the resistance to the sort of obvious solution of just making the jobs better?

Betony Jones

Yeah, I think there is some habit there. And to be honest, we don't have a lot of really strong policy levers. We have carrots and carrots and carrots and we're trying to use those. And I think this administration is really committed to helping companies to provide better jobs. I mean, certainly at the Department of Energy, we bake job quality into our funding guidelines because we know that these companies are really only going to be successful if they are able to attract and retain the skilled workers that they need. And so we want them thinking about that up front.

And we're not the only agency doing that. But I think there is habit. There's decades of anti-union sentiment. Some startups say to me, I don't know why, but I've been made to believe that I should never talk to unions or that I should fear that at all costs.

David Roberts

Yeah, it's just ambient now among that class, I think.

Betony Jones

I think for a long time in the clean energy realm, we've thought about the lowest cost as the solution to the climate crisis. And that lowest cost sometimes usually comes on the backs of workers and lower wages. And there's been even a concern among climate advocates that better jobs are going to slow down adoption or slow down deployment. And so I think that it's pretty entrenched and not just among employers. And I think this administration and certainly the passage of the Inflation Reduction Act puts that theory to the test because the Inflation Reduction Act passed in part because of the labor standards, the prevailing wage requirements, and apprentice utilization standards that are tied to so many of the infrastructure investments.

David Roberts

And I would be remiss if I didn't also insert here that states pioneered those kinds of policies, including my own home state of Washington were really early in doing that, in tying the sort of level of tax credits to the level of worker agreements and things like that.

Betony Jones

Right. I mean, it makes sense, right, because when people see a future for themselves in a low carbon economy, it's much harder to remain resistant to that transition. But for decades we didn't design our policies that way except at the state level where some states were innovative.

David Roberts

Right. Even that it's pretty recent at the state level. Yeah. So the traditional ding you hear when you talk about workforce issues, one of the things you often hear is we're asking the country, the workforce, to move away from jobs that are really well paying and unionized to jobs that pay less, basically to worse jobs. The idea is that solar and wind and retrofit jobs and solar installation jobs are just worse than the jobs that are being moved away from. And this is one of the things that creates immense resistance among unions because, you know, not unreasonably, they want to keep the good jobs and are not induced by the promise of less good jobs waiting over the horizon. So do you feel like that's changing or will change?

Betony Jones

It does have to change. Again, employers that are paying well with some career stability for workers do not have the same challenges with recruitment. And we have data that shows there's a lot that shows that that's the case. And it's also true that solar jobs don't pay as well as fossil jobs, but they also don't pay as well as just general construction jobs. So this effort to drive down costs of renewable energy has been really important for increasing adoption, but it has not been helpful for fulfilling the workforce needs of that industry or building a nimble workforce that can transition from one technology to the next, which is really what we're going to need.

We don't need a massive workforce of solar installers or wind technicians or EV charging infrastructure maintenance workers, we need people who are able to perform tasks associated with those technologies, but not only that, who can also pivot when the incentives for solar decline and something else picks up that they can pivot to another job. So I think the narrow focus on clean energy workers as if they can only do one thing has been detrimental to building the broader workforce that can do more of these things and also making clean energy jobs compelling. Because right now, if they're lower paying and less stable and you have to travel all over for work, that's just not very attractive for very long for workers. And so it has to change and it will change.

But the other thing that is changing is that clean energy, while we might think of solar panels and wind turbines as these iconic symbols of clean energy, now clean energy means so much more than that. It means battery factories for electric vehicles and EV charging infrastructure all across the US. And geothermal.

David Roberts

Geothermal!

Betony Jones

Yeah. I love Geothermal. I love Geothermal because it's such a direct —

David Roberts

Everybody loves geothermal.

Betony Jones

Do they? That's news.

David Roberts

Well, everybody in my tiny world.

Betony Jones

Well, we should be friends. The workers who maintain the fossil infrastructure, those skills are directly transferable to geothermal and so it's a really great opportunity for transitioning workers, whereas the workers from a natural gas power plant, that is a pretty different workforce from building a solar farm.

David Roberts

Hydrogen hub.

Betony Jones

So there's some technologies a lot we're investing in now. Yeah, hydrogen hubs are another example where you have much closer alignment between skills from the fossil industry and the clean energy. And not just the skills, but some of the employers are the same. Some of the fossil fuel companies are the ones who have the resources to invest in some of this new clean energy. So that could also help.

David Roberts

So over time, as these labor markets are tight and employers are competing for workers, there's going to inevitably be a movement to make the jobs better, if only just to attract the workers. In some sense, that's just like the normal operation of market capitalism at work. So my question to you is to what extent can public policy speed that up? To what extent do you have levers that can induce employers to improve their jobs, that can create maybe like, programs to onboard people into these areas? How big of a lever is public policy relative to what are huge macroeconomic trends?

Betony Jones

Yeah, so we have our funding, but I wouldn't say that's the strongest lever that we have.

David Roberts

The carrot?

Betony Jones

Yeah, we have the carrot. We have the 62 for DEO, the $62 billion for energy infrastructure through the bipartisan infrastructure law, then another $30 some billion through the Inflation Reduction Act. And there's the tax credits that are tied to, again, prevailing wage and apprenticeship standards. So we have our funding levers. And those are significant, I think especially the Inflation Reduction Act lever is significant. It will kind of move the needle for construction job quality, I think. But we have these other levers, too.

Or maybe lever isn't the right word, but the federal government has real great convening power. And so one of the things we're doing to address manufacturing, and battery manufacturing in particular, is to bring together employers and unions and other experts in the field to identify what are the skills required to manufacture battery cells? And then we'll look up and down that supply chain and can we get to some industry consensus? And the argument that we make to employers is this there's no coherent system of workforce development for advanced manufacturing in this country. And so what that means is that every employer is responsible for training their own workers and there's nothing really to keep their trained workers working for them as opposed to going to work for a competitor.

David Roberts

Right. You invest in the worker and then the worker goes somewhere else. And that's inducement not to do it in the first place.

Betony Jones

Right? So there's this free rider problem. We can move away from that because workforce doesn't need you're competing on so many different areas. Workforce development, workforce doesn't need to be a point of competition. We're trying to rapidly grow this industry and facilitate the ability of American companies to compete with Asian companies in this space. So let's take workforce development out of the competitive arena for manufacturing and figure out what are the skills that everybody needs. So there's always going to be 15% or something that's proprietary, but what's the 85% that's not? And then how do we standardize that, communicate it to community colleges or support the development of new apprenticeship programs that will really support the rapid growth of that industry. And so that kind of thing where you're building industry consensus and trying to do that in a really rapid way to get these training guidelines to support the development of a whole new industry that's I think a really powerful tool that we have and that we're using.

David Roberts

It seems like other countries, specifically European democracies, I guess specifically, I'm thinking of Germany. But I'm presumably not only Germany are sort of better at this than us. There's more sort of like bringing industries together and doing this sort of common work and setting up institutions for training people that go into these. Are there models from other countries that you think are really promising in terms of trying to not just shift a workforce so that it's ready for a booming industry, but to do so purposefully and quickly? Are there other models in other countries?

Betony Jones

There are models, but I would say I more look at the success of other countries. So Germany has a really robust apprenticeship system. They have seven times the number of apprentices per capita as the US has. And it's a really valid training pathway in the eyes of parents and students and workers. And I think we need to build up our apprenticeship system to get there. But the challenge of looking at other countries is that the context is so different. Other countries, I was talking to a roundtable of embassy people recently and I was talking about our approach with the Inflation Reduction Act and the Bipartisan Infrastructure Law and they were just floored that all we have is incentives.

They were like, can't you just require this? Like what?

David Roberts

You just got to explain budget reconciliation to them. It all makes total sense.

Betony Jones

Right. I mean, the context is just so incredibly different that our solutions really do have to be American made. But there are examples in the US that work really well. So I will refer again to the construction industry and the system of registered apprenticeship. Let me just tell you for a second why this is such an incredible system of workforce development. One, it's privately funded.

David Roberts

This is here in the US you're talking about?

Betony Jones

Here in the US union apprenticeship training for construction occupations. It is privately funded by both the employer and workers. Workers take money out of their paycheck to fund the next generation of training. And so the people enrolled in apprenticeship, they work out in the field, learning on the job while also taking classroom training. And they're paid from the get go, they're paid from day one and their pay increases as they acquire skills and training. And so they have this articulated trajectory of pay until they graduate three to five years later with their journey card.

That is a transferable industry recognized credential that they can take anywhere in the country and get work. And so again, it's privately funded. Employers are putting in money and workers are putting in money. And that ensures that the system is accountable to the employers in terms of the skills that it's providing people and accountable to the workers in terms of realizing that they're going to get more money as they advance in their career development. And so that system works really well and it's collaborative. A bunch of employers contribute to that same system of training and then they can draw workers out of that system of training when they need them on the job.

How do we translate that to new industries? How do we expand that model for manufacturing?

David Roberts

Was that born of some kind of public policy nudge, or is that just something the industry developed itself over time?

Betony Jones

Oh, my gosh, that's a stumper. I don't actually know. But it has been around for a very, very long time and it serves everybody well. It's sort of one of these things. If it was developed today, it would be like the greatest social innovation. It would be all over the headlines. It's this incredible system. The unions put $2 billion a year into apprenticeship training.

David Roberts

Oh, wow.

Betony Jones

That's the contribution of workers and then there's an equal contribution from employers. It's not dependent on public policy. It's not dependent on the whims of philanthropy. It's not dependent on anybody. It's built into the system to make sure that the construction industry will be able to retain and grow a skilled workforce continuously.

David Roberts

But on the other hand, the Bureau of Labor Statistics also says that the construction industry is short 413,000 workers.

Betony Jones

I like your stats, and BLS is a reliable source. But the thing is, the construction industry is not very heavily unionized. So on the one hand, we see ten people seeking apprenticeship openings as there are positions for. Ten people for one position. Why can't apprenticeship programs just accept more people? If they have ten people who want in, why don't they just bring ten people in?

David Roberts

Right.

Betony Jones

It's constrained by their ability to put people to work. So if they don't have a project labor agreement to build the thing, then they can't guarantee a job for that person they're bringing into apprenticeship. As they get more agreements and as more construction activity gets built union, then that system of training can expand rapidly. And we've seen that in the past. It's very, very nimble. It can scale, but it is driven by demand. And not just demand for construction workers, but demand for union construction workers.

David Roberts

It sounds like the slow pace or the anemic state of unionization in the US is a big part of what is creating this backlog or this appearance of backlog or this sort of choke point. Would you like to see and maybe you aren't allowed to say, but would you like to see other kinds of policy? I mean, are there other things that Congress could do to accelerate unionization or to support unions that you think would have the sort of side effect of accelerating the clean energy workforce?

Betony Jones

Sure, Congress can do whatever they agree to.

David Roberts

Or can't, as the case may be.

Betony Jones

But there was an early proposal, I think, to tie the electric vehicle tax credits to union made, or at least have some higher level tax credits and bonus credit if the vehicle was made in the US and made union that got stripped out, that would have helped. Right now we have Davis Bacon is the law that applies to federally funded construction work. So for construction, if you're using federal dollars, there are certain labor standards and wage standards and reporting standards that you have to meet.

And then in the Inflation Reduction Act there's wage standards and apprentice utilization standards. But beyond construction there's nothing statutory to nudge more work or to make it easier to unionize. Ultimately, unionization is the choice of the workers. But there are a number of barriers, ever increasing barriers, to support unionization. So it has actually been the National Labor Relations Act was passed in 1935 and that act says quite clearly: It is the policy of the federal government to support worker organizing and collective bargaining because the quality of bargaining power is important to the free and fair conduct of commerce.

Or some 1935 language that I'm not paraphrasing very well, but it says explicitly it is the policy of the US government to support worker organizing and collective bargaining and yet lawsuit after lawsuit and decision after decision have kind of cut away at that right of workers.

David Roberts

Yeah, I wonder to sort of loop this back in. So there's this story in The Washington Post about how during the pandemic and post-pandemic, basically inflation kind of brought down the purchasing power of upper income people and labor market tightness raised the wages of lower income people. And as a consequence, the inequality gap in the US shrank by a crazy amount in a crazy short period of time, which you might think, woo! But in Rides, Powell and the Fed who say explicitly the rise in worker wages is a problem, we have to solve this problem by raising interest rates.

So it seems like we have a macroeconomic institutional setup that is intrinsically hostile to raising the wages of blue collar workers. Even as with the other hand of the federal government, we're desperately trying to improve those jobs. What do you make of that? Is that resolvable?

Betony Jones

I mean, I can see how one would draw that conclusion. I don't know. I think there's a lot of barriers to trying to improve job quality, particularly for workers without a four-year degree. And all I'll say is that I don't think we can achieve our ambitious clean energy goals without doing that and that employers will, whether they do it because we're now asking them to or they do it because they eventually realize that they have to. The labor market is competitive. The balance of power has shifted more to workers after the pandemic or during the pandemic, and I think workers are asking for more from their employers.

If you're an employer and you want to find and be able to retain a skilled workforce, you're going to have to make some investments in that workforce. And think about workers really as something that you're investing in and not this disposable commodity, because that's not a recipe for success, to be just churning through workers that employers aren't willing to invest in the skill, development, and advancement. I mean, you think about things like batteries or advanced manufacturing. This requires a really high level of skill. And right now, the way that that work is structured is to bring in low-wage workers to do very rote work and bring in foreign workers to do the skilled work.

And there's no transfer, there's no knowledge transfer happening. That's not going to work. Once we have 100 battery cell factories across the country, we're going to need to invest in our own workforce if we're going to be successful here.

David Roberts

And also, I think, worth noting here is we can remember back to sort of globalization draining away these high-paying jobs and the federal government responding. I remember Bill Clinton sort of responding with this sort of hand-waving about worker retraining. This was kind of a mantra like, oh, retraining, retraining. We're going to help our workers adapt. And to my understanding, those federal worker training and retraining programs just have an abysmal record. And so, consequently, jobs were degraded, people got kicked out of jobs, and there was an immense and still ongoing political backlash. So you would hate to see like a decade of transition to clean energy followed by a backlash against the sort of low-wage labor it's involved.

Betony Jones

And sometimes, I mean, not just accounting for the track record of those programs in terms of job placement, but sometimes massive training programs can actually have the opposite effect, where even during the ARRA period, we invested tons of money in solar training and other clean energy workforce training. And what happened then is that we sort of flooded the labor market with basically qualified people who couldn't find work. And so that drove wages down, right? That people were competing with each other and trying to get a job. That drove wages down. That served the industry, or it served the employer part of the industry, but it maybe hurt the industry long term because now people think of clean energy jobs as unreliable or as volatile, and that might not have helped us long term.

And so this time around, Congress passed these policies with very little money in the way of workforce education and training. There's very little. There's a few programs for a few things, but most of it is money that we're investing in the infrastructure itself, in the implementation, the deployment, the demonstrations. And so employers need to think about how they're building workforce development into their implementation plans because there's not just this massive pool of public funding to go train a bunch of people and hope that they find their way to jobs. This time it's much more demand-driven in order to ensure that there's good calibration.

And even if Congress were to pass or put some money into workforce development, the timing of that is more likely to align with when real jobs are going to be created. Because right now, there's a lot of construction planning happening, engineering happening, but a lot of the construction is yet to materialize. And then the manufacturing jobs are even a little bit further away. First, you have to build the factory before you can staff the factory. So we do have a little bit of time to kind of reorient the labor market to meet the demand for these positions.

David Roberts

But the overall message here is this is not going to be a thing where the federal government steps in and sort of spends a bunch of money taking charge of the workforce itself. You're basically convening private industry and trying to help them and train them and show them how to develop these programs themselves so that they become kind of self-sustaining?

Betony Jones

Yeah, I think it's an all-hands-on-deck. I mean who knows what Congress will appropriate in the future? But right now we're not dealing with a lot of public money for workforce development and so we are looking at how do we engage strategically? There's a massive community college system out there, 8.5 million students. There's a massive apprenticeship program out there, there are states and there are workforce boards that are funded through the Department of Labor. How do we align all of this existing workforce infrastructure to meet some of the needs of the clean energy sector? That's where I'm thinking more.

I don't think we have as much power when we have a million dollars to spend and we go train 26 people but if we have a million dollars to convene and corral the massive community college system out there then we're getting somewhere. So it's just what resources do we have available? And that's just an example by the way, we're not spending a million dollars —

David Roberts

It seems like —

Betony Jones

— to community colleges.

David Roberts

community colleges for their own purposes have all the incentive in the world to try to get smart on this and to try to orient themselves toward the big burgeoning jobs of the future. I'm sure they're hungry for guidance or are they? It seems like they should want this.

Betony Jones

Absolutely and it's hard. Guidance is hard to develop. Getting industry consensus for an emerging industry, that's challengin. And so yes, people want that because they want their curriculum to meet employer needs. They want the students that they train to be able to find work in their community. So yeah, people are hungry for the guidance and I think that's a really valuable thing that we can do.

David Roberts

Okay, my attempts to goad you into badmouthing the Fed having failed, let's move on into one other thing, which I didn't leave all that much time for. And it's really, really huge subject, but maybe we can just sort of say some broad things about it, which is the other side of the coin, which is fossil fuel jobs going away. If you count not only sort of direct fossil fuel jobs but all the kind of second-order peripheral jobs around fossil fuel jobs serving fossil fuel workers, et cetera, et cetera. There are a lot of those and there are communities that depend on those fossil fuel jobs almost completely.

And there's been a lot of hand-wringing about this, about what to do with all these workers that are going to basically be pushed out of jobs if we do the clean energy transition successfully. I hear a lot of talk about this and I hear a lot of happy talk about how we're going to retrain them to work in geothermal or whatever. But the scale involved, I have not yet seen anything that seems of the scale of the problem. So are these sort of like fossil fuel worker retraining programs, are they just like nice brochures? Is there any prospect of having a humane response to that problem at scale?

Betony Jones

Well, there has to be the prospect of it, and I think that's the thinking around and talk around a just transition. We can't leave people behind. It's not the right thing to do, and it will slow us down in terms of building political will to do more of the kinds of things we need to address the climate crisis. So it's not just a moral imperative, it's just a pragmatic issue. It's not just jobs. It's the fossil fuel industry's hold on the economy, actually the tax revenue for communities that are dependent on those industries. There's a lot of issues beyond just the jobs that threaten or pose risks too.

David Roberts

Yeah, I mean it's their schools, it's public services. It's all sustained by fossil fuel money in some of these places.

Betony Jones

So our approach is really, like, looking at economic redevelopment and diversification. There is no one-for-one replacement for a fossil fuel facility in a community. Like, I live in a county that has five refineries.

David Roberts

Oh my God.

Betony Jones

They are at risk at some point due to transportation electrification. There's no single industry that can come in and replace that economic base or those jobs. So then the challenge is economic diversification. And how do you retain an industrial base for blue-collar workers? It's not all just transitioning to the creative class or something else. How do you retain an industrial base in these communities?

And I think that advanced nuclear carbon capture and storage, direct air capture, hydrogen, some of these technologies that we're investing in provide those opportunities because they aren't necessarily dependent on a resource. They can be anywhere. So why not locate in a place that can use existing assets, including the infrastructure but also the workforce? There's a whole interagency working group that is really looking at how to serve energy communities, how to connect them with resources, how to make sure we get this transition right and create new opportunities for workers.

David Roberts

Let me ask about that because you wouldn't expect jobs in those new industries that you're talking about to sort of spontaneously align with lost jobs, right? You wouldn't expect them to sort of spontaneously line up with the places that need to replace fossil fuel jobs. So aligning them has got to be active, right? It's got to be done by someone and a) sort of like whose job is that and how does it work? And b) sort of like do we have a track record of success? Everybody's talking about this return to industrial policy, which is fantastic.

But industrial policy involves a lot of really difficult questions that we have not necessarily done great on in the past. And one of them is like trying to match new jobs to the places that most need them. What are the kind of instruments you can use to push that alignment?

Betony Jones

Well, one, I will say the track record of success is really with military base closures.

David Roberts

Right.

Betony Jones

And there's a whole process that they follow so that they're not just leaving a community high and dry. And so again, there's domestic examples that we can think of. Aside from fossil fuels there's this massive transition underway in the automotive industry where the places where we're seeing new investments in battery factories are not necessarily the places that were supplying the parts and innards for internal combustion engine vehicles. And so in some of our grants and Congress gave us language to do this, we can create extra incentives for projects that are locating in communities that have or had an automotive facility. Or repurposing, I think there's funding for repurposing automotive factory supply chain factories, for battery factories.

So there's some levers in order to kind of put the thumb on the scale of locational decisions and then some of it is getting the word out around what are the assets of these energy communities and getting that in front of investors and people who are looking at where they can set up shop. And that's what the Interagency Working Group is really doing, like trying to draw investments to these communities.

David Roberts

Yeah. What I come back to again and again is the scale of these macroeconomic trends relative to these policy interventions you're talking about is the thumb on the scale. I have no doubt that in a few years there will be a few success stories you can talk about like oh look, this factory closed and this one opened. But does that seem adequate to the scale of the problem? Does anything seem adequate to the scale of the problem? Is there more you would like to see or more you think the government could do?

Betony Jones

Yeah, I think that's a good question. I mean, I guess I approach this with a bit of curiosity. I mean, for years again working on climate change, I sort of knew that we weren't doing enough to combat the crisis and yet I kept working on it. And then we got like a pretty significant bill adopted to reduce greenhouse gas emissions by a lot if we're able to get through some of these hurdles that you're going to cover in your podcast series. And so I think right now, me and I think others are trying new and creative things, partnerships, bully pulpit, levers with the funding that we have and with the authorities that Congress has given us.

And we're studying what works, and we're trying again and we're looking at what it's iterative. I feel incredibly optimistic. It might be because I don't have time to read the news or the headlines, which are always all so negative, but I see the kinds of things that we're putting into place for the long haul, and I sort of like I kind of can't imagine how it won't work.

David Roberts

Well, let me raise one possible way that it won't work, as my special talent is imagining problems. And this is probably not something you're going to want to answer since it's political, but one of the —

Betony Jones

There is a big reason why it won't work.

David Roberts

Yes. It's called the Republican Party. But let me flesh that out. One of the big trends we're seeing and there's been a bunch of headlines about this since the passage of IRA. IRA has spawned already billions and billions and billions of dollars of investments in factories, et cetera, et cetera. And most of them, the bulk of those investments are in red states. Most of the new investment is going to red states. And red states sort of notoriously have this kind of low unionization, low wage, you're on your own.

Betony Jones

Yeah, they're all right to work states.

David Roberts

Right to work states, et cetera, et cetera. So in a sense, the Biden administration's quest to make these high paying unionized jobs is, it seems to me, going to run into red state's long-time habit and ideological commitment to worker precarity, lack of unions, low wages, high churn. There's this article in the Washington Post the other day about, "Oh, why are red states hiring more?" And then they looked more closely at it, and then "Oh, they're just hiring and firing more" because there's more churn, because these are crappy jobs —

Betony Jones

People are quitting.

David Roberts

move through them more quickly.

So do you worry about that? Do you have any way to circumvent that? Do you see any prospect that Republican policymakers might change their tune on those issues to attract those kind of jobs? What are your thoughts on that?

Betony Jones

Yeah, I mean, you're right that it probably is too political to weigh on some of the specifics, but I do think that the Inflation Reduction Act is designed in such a way that I think Americans who haven't seen why they should care about climate change, their livelihoods, are now going to be tied to somebody caring about climate change. And how does that not sort of shift the way that people think? Not that people always vote in their self-interest, but —

David Roberts

I mean, Florida is sinking under the water and they're still — self-interest.

Betony Jones

But again, your livelihood is tied to a battery factory and the electric vehicle transition, it has to change a bit how people think and how lawmakers think, I don't know. I mean, the other thing is red states. Companies are locating in, quote, red states for a lot of reasons. But I don't think it's primarily because they're right-to-work states or because they're cheap labor states. It's usually because the permitting is quick, they can break ground quick, and they can get going quickly. And maybe there's some tax credits thrown in as a cherry on top.

And so there's a lot of factors that go into locational decisions. But I think, like, if you take Tennessee, for example, tons and tons of investment, well, that's going to make the labor market tighter, more competitive, and that will ultimately give workers more power. And so how do we change this dynamic? Some of it is going to be — the drive to organize your workplace going to grow right now that's seen a resurgence. Is that going to continue? Are workers going to feel empowered to ask for more? And how is that going to be a differentiator between companies in a state or between states?

David Roberts

What a fascinating dynamic. That will be fascinating and terrifying to watch. Well, I've kept you for too long. Let me finish with a sort of general question about your broad feelings about this area. So my analogy is sort of there's a lot of worry these days about the material specifically like minerals and metals requirements of clean energy. And there are a lot of sort of specific issues and specific problems and the solutions are not necessarily obvious or ready to hand. But generally my feeling is like, that's going to work itself out. Like of all the things that capitalism is good at, substituting materials and finding materials, is really good at that.

So I can't necessarily give you chapter and verse why, but sort of my strong feeling is like in 10-20 years we'll look back and be like "Oh, that just sorted itself out." Is that how you feel about the workforce issues or does your worry run deeper? Do you worry that this could be an actual bottleneck, an actual slow work to slow the transition? What's your sort of general level of optimism about this stuff?

Betony Jones

For the clean energy transition, I'm not at all concerned because I think there's the capacity of these jobs and industries to compete really effectively for workers in the broader economy and labor market. Where I'm concerned is like, am I going to still be able to get cheap takeout? Or like workers will come from somewhere and are they going to come from the service sector where we've gotten really comfortable with very low-cost services.

David Roberts

Right.

Betony Jones

So that's more likely, I would guess, to be where things are going to change. But I would also say this, this is an incredible opportunity to get more workers who face systemic barriers to employment off the sidelines and into the labor market. There's workers with a history of incarceration that have a very hard time finding work. Can these jobs be more accessible to them? Or to veterans? Or to youth who've been funneled into these four-year degrees, taking on enormous debt, not being able to find jobs? Is this more opportunities for workers like that? Or for women who have sat out since the pandemic because they can't find good childcare?

This is actually an opportunity to tap more of the full talent of the American workforce that hasn't been able to access it because of one barrier or another. And if we think more broadly around the workers that are available, if we do a little bit of work to help reduce some of those systemic barriers that are keeping people out, I think then I really don't worry. But I don't worry anyway.

David Roberts

So we have the people.

Betony Jones

I think so.

David Roberts

This is super interesting. I'm going to maybe slightly downgrade my worry about this particular horseman and compensate by worrying more about one of the other ones.

Betony Jones

Worry about permitting.

David Roberts

I worry about that plenty. Okay, Betony Jones. Thank you so much for coming on and talking with us. It was great.

Betony Jones

Thanks for having me.

David Roberts

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