the (new) american worker

Summers Touts Jobs Growth, Calls for Energy Legislation
April 6, 2010, 5:50 pm
Filed under: Washington | Tags: , ,

On the heels of an extremely positive jobs report for the nation – U.S. payrolls increased by 162,000 last month, the highest increase in three years – White House economic adviser Larry Summers spoke to the press today to tout this administration’s success in getting Americans back to work.

Yet still needed, Summers said, is “comprehensive” energy legislation, to instill confidence in producers and consumers alike.

“Clarity brings certainty, certainty brings confidence and confidence moves the economy forward,” Summers said.


No (Economic) Surprise: Green Manufacturing Jobs Flow Overseas
April 3, 2010, 2:52 pm
Filed under: jobs | Tags: , , , , ,

One of the persistent concerns of President Obama’s massive $367 billion federal investment in new energy projects – from coal to renewables – is that the American labor force is too expensive, and/or lacks the proper training, for the needs of producers. A piece in Bloomberg BusinessWeek this week captured this idea quite simply:

No surprises: Arizona's First Solar will use federal incentives to hire 200 American workers - yet 71 percent of its manufacturing needs will still be met by foreign labor.

From BBW:

“Tempe, Arizona-based First Solar Inc. plans to do 71 percent of its manufacturing hiring in Malaysia after getting $16.3 million in federal funding to hire 200 people at an Ohio plant.”

Herein lies the ultimate problem – the economics of outsourcing the majority of manufacturing needs still makes sense to companies, incentives or not. Unfortunately, this simple reality doesn’t quiet any of the political outrage – especially as the Obama administration attempts to make good on its promise of 700,000 new jobs in stimulus renewables projects.

A green “industrial revolution” right here in America sounds great to some people – me included. This very blog was created to educate myself and others on the potentials for American labor in a new energy economy. Yet how the Obama administration is supposed to leapfrog over simple economics – foreign labor is, in my cases, simply cheaper – is still unclear to me. Perhaps it really is time that our nation’s expectations are shifted towards the potentials that lie in specialization and competitive advantage. CNBC recently ran a days-long debate on this topic, and the discussion turned often to where our best efforts should lie: in advanced education and innovation or in heavy industry and brawn. I believe Obama’s energy policies intended to do both – boosting Silicon Valley and Pittsburgh too. But is this really an economic reality? Perhaps not. “Green tech” manufacturing seems likelier to catch headwinds, i.e., manufacturing roles that place a heavy emphasis on innovation and other specialties, like low-carbon technology. But putting American steelworkers back to work building solar panels? Even with training and workforce investment, as U.S. Labor Secretary Hilda Solis promised in this manufacturing summit on CNBC, this is a tall order. I’ll continue to entertain the idea (dream). But in the meantime, let’s not be surprised when we continue to lose certain types of jobs overseas – even better, let’s plan for it.

Winning the Energy (And Capital) Efficiency Game
April 1, 2010, 11:53 am
Filed under: Cleantech | Tags: , , , , ,

Caught the Q1 call for Cleantech Group yesterday, a Bay Area research group that has been tracking the clean tech sector since 1999. There was some good news last quarter, for sure, albeit the emergence of what may be the “new normal” for cleantech venture funding as the global economy still struggles to right itself.

Better Place CEO Moshe Kaplinksy is working fast towards a new world for transportation - and has $350 million in Series B venture funding to show for it.

First, the good news:  Q1 marked a record quarter in cleantech, not only in the recording of 181 deals – a landmark – but also in sketching that “sharp up and to the right” quarterly growth that we all love to see.

“The death of clean tech venture capital – I think we can firmly say that is not happening, said Sheeraz Haji, President of Cleantech Group. “Clean tech venture is back, it’s back strong.”

Next, the less good news, well for solar and all those capital-intensive projects anyways – though Q1 marked a record high in venture deals for the sector, it did not mark a record high in capital raised. Valuations are still down, Haji noted, and the funds that are being dished out are going towards “follow-on financing,” or those companies past the Series B round. Two losers are emerging: those in need of early stage capital, i.e., holding the burden of proof, and those whose capital needs exceed the amount a fund is willing to put in. While federal incentives remain for investment in wind and solar technologies, venture funds seem to be  hyper-conscious of the regulatory and capital challenges – such as land use issues – that exist in solar/wind plays.

So who is getting all those deals? Ironically, those who aim to save power – and cash. Energy-efficiency projects, including smart grids, LED lighting, and battery technology are the hot spot for development right now, says Cleantech. The $217 million that flowed into efficiencies last quarter was also likely because of continued federal incentives for utilities and corporations alike to improve their energy profile.

Finally, transportation was “off the charts” in dollar value for Q1 – a $704 million quarterly dominance that was driven by a couple of big deals. A $350 million Series B round for Better Place, followed by $140 million for Fisker Automotive – developer of plug-in hybrid cars – shows that those cap limits mentioned earlier will be tossed aside for a good auto play. Personally, I think Fisker is really exciting – let’s make a good American car!

Dear LA Businesses – What If Your Jobs Are Simply Inefficient?

There has been a lot of tension lately between Los Angeles-area businesses and LA Mayor Antonio Villaraigosa, a media spectacle that comes on the heels of Villaraigosa’s recent proposal to enact rate hikes at the Los Angeles Department of Water and Power. Yesterday marked the latest chapter in the saga, as the LA City Council voted 13-1 to reject Villaraigosa’s plan. The council will, however, take up the issue again Tuesday, thus propeling the mayor’s plan forward at least another week.

In a fight to shift demand towards more sustainable energy sources, Los Angeles Mayor Antonio Villaraigosa is honorably heading off political convenience for a broader good.

Quick to make Villaraigosa out as an economy-slaying villain, these businesses have claimed the mayor’s plan will bury businesses and consumers alike with rate hikes that could peak at 28 percent, according to this article in the LA Times. ‘How can we possibly survive this’ – CEOs have cried out. In nearly the same breath, they easily found their own answer – by cutting costs and reducing staff.

Naturally, in these tough economic times, any job losses are somewhat undesirable. But what Villaraigosa, in my opinion, is trying to do here is greater than propping up area businesses. What he is trying to do is use economics to shift demand towards more sustainable, cost-effective sources of power – in particular, solar utilities. And on the jobs front, well, Villaraigosa claims he can in fact create new jobs with his plan – new jobs that will not just send people to work every day, but increase their utility for the community at large. According to the LA Times, the mayor’s office hopes to create 16,000 new jobs in solar installation, and 1,600 new jobs for “DWP doctors” that would work as advisers to LA-area households on how to increase their energy efficiency.

One of my favorite things about this story is the political risks that are being taken. Even circling the topic of layoffs in a struggling economy is risky at best. But Villaraigosa and his supporters are taking the high road – putting good ideas to work and taking on the hard work of persuading communities to acknowledge opportunity costs. And guess what? Just because you have a job doesn’t mean it is necessarily all that efficient or that the government is required to do all things necessary to maintain your livelihood (ahem, GM).

A great quote from LA City Councilman Richard Alarcon (via LA Times):

“That concept has won the support of Councilman Richard Alarcon, who said that, as Los Angeles shifts to a green economy, some businesses will need to make ‘bottom-line decisions’ about whether they can continue to operate. ‘There are going to be more businesses that will not succeed. But if they don’t succeed, we want it to be for the right reasons — because we are moving the economy in the right direction,’ he said.”

A less great quote from City Council President Eric Garcetti:

“‘I’ve never been opposed to a responsible step forward’ in increasing electric rates, Garcetti said. ‘But to take a giant leap in the biggest economic downturn since the Great Depression seems to be rash.'”

Ah, the Great Depression – or the “Great Recession” as the AP now asks reporters to term the economic downturn of late. Yes, it is valid, but how long will it just be a convenient excuse?

–Mia Lamar

Gallup: Americans Want Diverse, Economy-Focused Energy Policies
March 21, 2010, 10:49 pm
Filed under: jobs | Tags: , , ,

Gallup has run a number of polls this month that have really captured the current American sentiment on Obama’s ramped-up energy rhetoric and policy initiatives. The results demonstrate a rather conservative consciousness on energy, as in a March 13 poll where only 30% of respondents indicated support for reducing financial incentives for the oil and gas industries. In addition, 28% of respondents stated that current financial incentives for oil and gas should be maintained. Gallup condenses this information into a simple, powerful fact – 2 out of every 3 Americans believe the federal government should continue to support traditional energy sources like oil and gas. If anyone is wondering why Obama continues to pursue an “all colors of the rainbow” national energy policy – well, there you go.

A recent Gallup poll found that 53 percent of Americans favor economic growth over considerations for the environment.

The March 13 poll also showed an 11 percent tumble in the number of respondents who favor environmental protections over development of energy resources – from 58 percent in 2007 to 47 percent in 2010. Of course, the massive recession our country is still climbing out of likely influences these results. From nuclear to smart-grids, no energy proposal is complete nowadays without the requisite slogan of “jobs, jobs, jobs.” Compare this to the underemployment figure reported by Gallup this week – 20.1 percent – and it’s pretty easy to see why Americans are grasping at anything that resembles economic growth.

This realignment was also evident in another Gallup poll released last Thursday. When asked whether economic growth should be pursued, regardless of adverse environmental affects, 53 percent of respondents answered yes.

In my mind, this confirms what is often written nowadays about renewables like solar and wind – mainstream days are still a long way off. Sure, there may be huge economic potential in some of these projects – greater than the alternatives, in my opinion – but until renewable energy advocates can sell Americans on the idea that this potential exceeds the cost of reduced investment in say, natural gas or clean coal technology, then it looks like the American public will continue to support the old, the new and everything in between.

Giving Workers the Chance to Compete in Their Own Backyard
March 19, 2010, 11:57 pm
Filed under: marcellus shale, Uncategorized | Tags: ,

I’ve been doing some research lately on Marcellus Shale – the 54,000 square mile swath of thick shale that covers one of the largest motherlodes of known natural gas deposits in the United States. Years ago, the shale was too difficult to tap, but with the emergence of new drilling technology, the Marcellus Shale has now become one of the most closely-watched energy rushes.

Communities like Couldersport, PA are trying to give their own residents a chance to compete for jobs drilling Marcellus Shale.

Communities like Couldersport, PA are trying to give their own residents a chance to compete for jobs drilling the Marcellus Shale.

Much has been written in the past few years about drillers positioning themselves for a possible boom, especially of the initiation of contentious land leasing deals in the Marcellus communities. While some landowners are eager to sign off their land, they’ve drawn the ire of others who complain drillers and landowners alike haven’t adequately considered environmental effects. These stakeholders stretch as long as the shale formation itself, from upstate New York, through Pennsylvania, Ohio and finally into West Virginia.

From what I’ve read, many of the landowners who’ve agreed to drilling on their land, or are currently considering it, consider themselves just one piece of a broader mandate to breathe life into the struggling rural communities atop the Marcellus. An article I read recently quoted a New York woman who claimed to express great relief when she heard that the shale was now being tapped, not just for the potential windfall for herself and her neighbors, but for the creation of a new local economy that could create good, local jobs.

So this article caught my eye today when scanning new updates on the Marcellus Shale communities. It tells the story of Coudersport, a north-central Pennsylvania town whose population barely tops 2,000 people. The unemployment rate in Potter County, where Coudersport is located, is still higher than the national average, estimated at 10.8 percent in January. Seemingly, if towns like this one were on the fence about natural gas wells in their backyard, recent economic events have cast aside those concerns. The article describes standing room only at a recent natural gas industry job fair – where participants ranged from all ages and backgrounds. It also quoted a recent Pennsylvania study that estimates jobs in the north-central region of PA could grow by 62 percent by 2016, if the drillers are able to meet current regulatory and environmental challenges.

It is my opinion that the emerging US energy economy has the potential to change the face of American labor. Yet this article mentions one subtler point that it sometimes easy to forget –

From AP:

“Gas companies drilling wells bring in many experienced workers from out-of-state to staff Pennsylvania rigs…What in-state applicants may be lacking, though, are the proper skills. Area high schools, colleges and technical schools have started discussing how to offer training.”

I’ve written before about the need to give our human capital the skills they need to participate in our country’s energy ambitions. This article reminded me that I tend to think about this in broad strokes. Equally important, I believe, is to provide those workers who share a backyard with some of these projects with a fair chance to compete for them. I’m not suggesting preferential treatment, but rather smart planning that considers the local labor potential concurrently with planning and development.


Sen. Kerry: Energy Bill Is About Jobs
March 13, 2010, 12:04 pm
Filed under: Politics | Tags: , ,

Perhaps in hope of winning over his reticent Republican colleagues who still claim disbelief in global warming, Senator Kerry (D-MA) came out today to rebrand his environmental legislation as a jobs effort. In this struggling economy, who can protest that?

The AP report that, as opposed to the House’s “cap and trade effort,” climate is simply “along for the ride” in the Senate’s version.

“It’s primarily a jobs bill, and an energy independence bill and a pollution reduction-health-clean air bill,” Kerry said. “Climate sort of follows. It’s on for the ride.”

Some hardcore greenies might buck at this frank language, but anyone who knows politics knows Kerry is simply doing what he needs to do to actually get something done down in DC. Knowing that Republicans will have a harder time turning away from legislation that is packed with job creation, Kerry has simply rebranded cap and trade. Good for him!