TODAY’S STUDY: SO MANY JOBS IN THE SUN

National Solar Jobs Census 2011
October 2011 (National Solar Foundation)

Executive Summary

The National Solar Jobs Census 2011 updates last year’s census of employment and annual projected growth in the United States solar industry with new data from a statistically valid sampling of employers throughout the nation. The rapid pace of change in the industry has warranted annual updates that examine the size and scope of the industry.

The Solar Foundation™, a 501(c)(3) nonprofit, non-lobbying organization promoting solar through research and education, recognized this gap and worked with BW Research Partnership’s Green LMI Division, Cornell University, and others to bring this important information to the foreground. This report represents an unprecedented effort to understand the solar industry’s labor market conditions and potential for growth.

U.S. solar companies added jobs over the last 12 months at a pace much faster than the general economy and remain highly optimistic regarding their overall revenue growth in the near term. Specifically, as of August 2011, the U.S. solar industry employs an estimated 100,237 solar workers—defined as those workers who spend at least 50% of their time supporting solar-related activities—up 6.8% since August 2010. Over the next 12 months, almost 50% of solar firms expect to add jobs while only 2.6% expect to cut workers. This finding is especially relevant given that the overall expected 12-month growth rate for the entire U.S. economy is only about 1.4%.

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By comparing the job growth expectations from our multi-year research effort and from existing secondary sources, we can draw several important conclusions. As of August 2011:

• There are 100,237 solar workers in the United States, up from 93,000 last year. This represents an overall growth rate of 6.8% over the past year, nearly 10 times higher than the national average employment growth rate of 0.7%

• Solar job growth over the next 12 months is anticipated to be almost 24%, representing approximately 24,000 additional new jobs. Nearly half of all solar firms expect to add solar employees over the next 12 months.

• Employers from all of the studied solar subsectors expect significant employment growth over the next 12 months.

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• Nearly half of installation firms expect to be hiring in the next year, and these firms expect to add 13,068 jobs over the next year (25% growth rate).

• Almost 44% of manufacturing firms expect to add jobs over the next year, with 3,473 jobs expected to be created during that time (14% growth rate).

• More than 45% of sales and distribution firms expect to add jobs over the next year, creating 6,188 jobs (35% growth rate).

• A quarter of utility respondents surveyed in 2010 were expecting to hire additional renewable energy workers through 2012, with employment growth projections ranging from 10 to 19 percent.

These findings clearly illustrate that the solar industry is a strong and growing cluster that is responsible for thousands of jobs across every state in the nation. The unprecedented growth of the industry is providing much needed job creation despite an historic economic and workforce downturn. The optimism of solar employers in the midst of these conditions suggests that job growth will continue for years to come…

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Introduction

The solar industry is a strong and growing segment of our national economy. The industry has experienced rapid growth over the last decade, and thanks to increased incentives, price and cost declines, consumer awareness, cultural shifts, and positive policies, this growth has only accelerated in recent years.

The impact of this growth on the labor market has been significant. Companies that design, manufacture, sell, install, and maintain solar systems have emerged in all regions of the United States, providing tens of thousands of jobs throughout the country. These employment opportunities span numerous industries and occupational titles, from skilled laborers to customer service and sales representatives.

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Yet this impressive growth has not been without setbacks; stalled legislative initiatives such as the PACE (Property Assessed Clean Energy) program and decreased funding for state-level consumer incentives led to slower-than-expected job growth in 2010.

Employers reported several major obstacles to growth, including general economic conditions, lack of state incentives, and lack of consumer awareness, among others (Figure 2).

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Employers reinforced the importance of these barriers when asked to identify the positive factors related to their growth between August 2010-2011 (Figure 3).

This report is an update of The Solar Foundation’s™ 2010 comprehensive analysis of U.S. solar labor market conditions. The research findings provide stakeholders with fresh and credible information to understand the annual changes to the solar industry’s labor market and its potential for further growth. The report includes information about all types of companies engaged in the production, sale, installation, and use of all solar technologies, ranging from photovoltaics to concentrating solar power to solar thermal systems for the residential, commercial, and utility sectors.

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Unlike economic impact models that generate employment estimates based on revenue and other economic data and rely on jobs-per-dollar (or jobs-per-megawatt) assumptions, this repor t provides statistically valid and current data gathered directly from employers. The primary data contained in this report are drawn from a mixed-method survey using direct contact with individuals. Information was collected in July and August 20111 from a measure of so-called “known universe” firms, which includes firms from industry and government databases, and a random sampling of businesses within various construction, sales and distribution, and manufacturing industries, as well as an over-sampling of states which had larger employment counts in 2010 to provide a more complete state assessment.

This method allows us to accurately update last year’s effort and draw broad conclusions about the solar industry with a high degree of confidence. The figures included in this report are conservative estimates, meaning that there may well be more solar workers than reported herein. (There are limits to this approach, however: because the research findings are based on survey responses, the employment estimates herein represent only solar employers’ best estimates of how many jobs they will add over the coming year. As seen in the 2010 census, actual growth may vary.).

Unlike some other sectors, the United States government does not yet quantify solar employment. The lack of information has presented difficulties to policymakers and training providers. As a result, the Bureau of Labor Statistics (BLS) has commenced data collection on one solar occupation, Solar Photovoltaic Installers, and may continue their efforts for other solar occupations in the future.

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The Solar Foundation’s Census 2011 highlights some of the difficulties with categorizing solar workers into the neatly organized BLS frameworks. For example, many of the solar employers surveyed for this project report that their installers are electricians who work on both solar and non-solar projects. It is therefore difficult for employers to classify such workers when given an either/or choice of electrician or solar installer. This level of nuance is significantly easier to capture in a targeted survey related directly and only to solar employment.

It is important to note that the estimates provided in this report are estimates based on survey findings with employers in manufacturing, sales and distribution, and installation, as well as utilities. The data do not capture the government, academic, or nonprofit sectors, nor many of the research and development firms, finance and accounting establishments, law offices, or other ancillary employers that do solar work. As a result, the firm and employment counts included in the Census represent a minimum baseline level of solar employment.

The National Solar Jobs Census 2011 has been conducted by The Solar Foundation™ and BW Research Partnership’s Green LMI division. Cornell University provided technical assistance in reviewing and validating the entire process, from data collection through results analysis. With support from BW Research, Cornell University conducted the state-level baseline data analysis available in the Appendix (Section 5.3).

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Conclusions and Recommendations

The solar industry is a large and growing part of the economy, and its importance should only increase as incentives, consumers, and government regulations continue to favor a move toward clean energy sources. Already the solar industry is responsible for more than 100,200 U.S. jobs at more than 17,000 employment locations. The solar energy workforce grew an impressive 6.8% over the last year—nearly 10 times the overall national employment growth rate —and is expected to grow an astounding 24% in the next 12 months. In addition to beating the national average, this rate of growth soundly outpaces both the 0.7% growth predicted for the electricity generation industry as a whole and the negative growth (-2%) expected in the fossil fuels industry.

Supporting the solar industry presents an excellent opportunity to promote job creation, increase the availability of clean, locally sourced energy, and boost the economy as a whole. The research suggests several key steps that policymakers, workforce training providers, and the solar community at large can take to foster solar industry growth.

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Recommendations for Policymakers:

Recommendation #1: Stable and consistent incentives and renewable goals are important ways to encourage employers to grow their businesses. The 2011 Census shows that employers pay attention to incentives and regulations when planning for the future. When policymakers create new incentives and encourage investments, it signals to employers that the business climate is friendly, thus prompting private investment and job creation. However, it is important to note that in order to create a healthy and vibrant market, a sequence of long-term policies is key.

Recommendation #2: Create jobs by developing incentives that increase adoption of solar for consumers and businesses. The U.S. solar industry shows significant strength across the entire value chain, from research and development to maintenance. As a result, increases in solar installations lead to employment growth across the board—not only in manufacturing but in research and development, installation, and other related occupations. As evidenced in this Census, job growth has grown in correlation with installed megawatts, suggesting the strong link between solar adoption and job creation, and how appropriate policies lead to solar adoption. According to the state-level data collected for the 2011 Census, all but two of the top 20 states have a Renewable Portfolio Standard (RPS), and all but five allow third-party financing. Also, 14 of the top 20 states scored an “A” in net metering, and 16 scored “B” or better in interconnection, as rated by Network for New Energy Choices.

Recommendation #3: Invest in solar training, but recognize that although some entry-level positions do exist, the majority of solar jobs tend to be in high-skill occupations. While solar energy creates jobs across a wide variety of occupations and technologies, solar jobs tend to be for more highly skilled workers and expectations in creating job opportunities for lower-skilled workers should be managed. Programs that give high-skilled workers new or updated skills or experience and entry-level programs through technical high schools, community based organizations, and community colleges that prepare lower-skilled workers to move into more highly skilled occupations are greatly beneficial to the industry.

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Recommendations for Workforce Training Providers

Recommendation #1: Connect to local employers to understand specific needs. The solar industry is experiencing consolidation and specialization, with several large installation firms coordinating popular alternative financing models. This is changing the way work is done in any given area, so connecting to local employers is even more important to understand specific local needs. For example, some of the larger installation employers conduct their operations—including site assessment, sales, and customer service—off-site while hiring local installation firms to perform the site work. In such a scenario, it is important for local training providers to understand their local workforce needs.

Recommendation #2: Focus training efforts on workers who already have some occupational experience. Research shows that the most successful candidates for solar industry jobs are those who already have work experience directly related to the position they are hoping to fill, and solar employers tend to value this type of experience much more than classroom or on-the-job training. When choosing training program candidates, the focus should be on updating or strengthening participants’ existing skills, not starting from scratch.

Recommendation #3: Train workers for the full spectrum of solar occupations, particularly those in sales and manufacturing. Despite a high demand for a wide variety of occupations within the solar industry, training programs typically focus on just one or two industry job functions, with installation being particularly popular. To serve the needs of the industry and aid as many job seekers as possible, training programs should offer skill development opportunities across the full range of occupations. Training workers for jobs in sales and manufacturing will prove particularly beneficial.

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Recommendations for Employers and the Solar Community

Recommendation #1: Develop targeted, regionally relevant energy usage information and promote programs that maximize rapid adoption of energy conservation policies. Being able to provide state and local governments with better information about local energy use patterns would help policymakers see the need for additional solar incentives and empower them to design those incentives to best benefit consumers and the industry alike. For example, the average home in the northeast uses more energy for heating than electricity, and this heat often is generated by oil and natural gas. Solar technologies are used extensively in other countries for heating as well as electric production; knowing this could have a big impact on the types of incentives offered in that part of the country.

Recommendation #2: Develop a better working knowledge of state, local, and federal incentives in order to help consumers make informed decisions and to offer better turnkey solutions. Knowing more about what incentives exist will help solar firms to develop services that best take advantage of those incentives and guide consumers to the most cost-effective solutions.

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Recommendation #3: Recognize the importance of local, state, and federal advocacy organizations. In any industry, developing relationships with like-minded advocacy groups is key to making the sector’s voice heard. Through these groups, the solar industry can educate policymakers and the public about the benefits of solar energy and the number of jobs the industry creates. Raising awareness of these important attributes will allow the industry to effectively promote new incentives and other favorable policies.

Over the past few decades, the solar industry has grown from a niche market to a major economic force. With even greater growth in the foreseeable future, the industry stands as a notable bright spot on the nation’s employment landscape. Working together to support the continued growth of solar energy, policymakers, workforce training providers, and the industry have an excellent opportunity to boost the struggling economy and reduce fossil fuel dependence while creating good jobs for skilled workers…