Global Corporate Xpansion

THE TOP 10: NEW INVESTMENT POTENTIAL VS. MANUFACTURING JOB LOSS

State

Number of
full-time
equivalent
job years
(over 10 years)**

Average investment population in ($ billions)

2001 Jobs lost U.S.

Rank Jan. 2001- Aug. 2004

Manufacturing
in
U.S.

Rank

California 95,616 34,501,130 Texas 60,100 21,325,018 Illinois 56,579 12,482,301 Ohio 51,269 11,373,541 New York 47,930 19,011,378 Pennsylvania 42,668 12,287,150 Indiana 39,221 6. 26 6,114,745 Wisconsin 35,133 5. 53 5,401,906 Michigan 34,777 5. 33 9,990,817 North Carolina 28,544 5. 26 8,186,268 Total for top 10 states 491,837 91.61 140,674,254 Total percent of U.S. 57.45% 57.34% 49.39%

The data in this table have been revised since the original publication on February 13, 2008. ** The number of full-time equivalent job-years is computed over a 10-year horizon and thus not directly comparable in value to manufacturing jobs loss in the fifth column, which is presented to illustrate the distribution of job loss across states. Source: Renewable Energy Policy Project state manufacturing reports, available at www.REPP.org.

$20.91

13. 22

8.84

8. 40

9.93

1

2

5

7

3

6 14 18

8

11

343,600

177,600

145,600

173,000

148,500

161,200

70,900

67,500 142,600

162,900 1,593,400

57.16%

1

2

7

3

6

5

11

13

8

4

renewable energy technologies like photovoltaic, biomass and geothermal sources, the number of firms grows to between 70,000 and 110,000 firms. If renewable projects are used to stabilize carbon dioxide emissions for a decade, the new investment will exceed $160 billion, and more than 2 million full-time equivalent job-years — or 200,000 permanent jobs if spread evenly over the decade — will be created (a full-time equivalent job-year is

2,000 hours of required labor).

While the firms are spread across every state, they are concentrated in the 10 states that have suffered the greatest manufacturing job losses over the past six years. ⁷

As seen in Table 1, above, the potential for major renewable energy developments to offer new economic activity to the states hardest hit over the past decade is striking: 57 percent of the new jobs and 57 percent of the new investment will go to the 10 states that between them have suffered 57 percent of the job losses. Any major program to develop wind or any of the other renewable generation technologies would provide a potential burst of demand for new manufacturing activity and job creation in precisely the states and regions most in need of such a stimulus. ⁸

George Sterzinger is the executive director of the Renewable Energy Policy Project. He can be reached at gsterzinger@repp.org.

Discussion papers prepared by or for the Agenda for Shared Prosperity are meant to stimulate discussion on important policy topics. Recommendations should be viewed as the opinion of the author, and do not necessarily represent the views of the Economic Policy Institute or its researchers.

End Notes

1. The Production Tax Credit for wind has been on again and off again since the 1980s. Since then, it has been renewed for

periods as short as one year and has even been allowed to lapse. Here are the rough numbers of installations by year (from 1998 to 2004): 1998 – 300 MW; 1999 – 2000+ MW; 2000 – 0 MW; 2001 – 6000+ MW; 2002 – 1800+ MW; 2003 – 6000+ MW; 2004 – 1700 MW.

2. In June 2007 a major energy bill introduced by the majority Democratic leadership in the Senate, S-1419, contained no proposal to support the development of renewable energy industry. In July 2007 the Senate proceeded to add a series of amendments to HR 6. One of these amendments introduced by Sherrod Brown (D-Ohio) provided for the first time a series of incentives to support the growth of the renewable energy industry.

3. Industrial Competitiveness and Technological Advancement: Debate Over Government Policy. Updated August 3, 2006, Wendy H. Schacht, Specialist in Science and Technology Resources, Science, and Industry Division, Congressional Research Service, Washington, D.C.

4. Sterzinger, G. “Rethinking the Production Tax Credit,”

Public Utilities Fortnightly, July 2006.

5. Uchitelle, Louis, “Goodbye production (and maybe innovation),” New York Times, Dec. 24, 2006.

6. The 100th Congress is working toward major, new energy legislation. The Senate bill did not support an RPS. However, the House bill passed on 8/4/2007 did call for a 15% RPS. The final bill negotiated in conference committee dropped the RPS.