Trade and Labour Shortage Following Trillions in Energy Investment

Jennifer Leakos
Come in we're hiring sign
Courtesy of Peninsula Canada

As literally trillions of dollars are poured into clean energy development programs around the world, governments, investors, and project developers alike are starting to ask themselves one major question: do we have enough people to actually build it all?
What’s happening: With global investment in renewables and other clean energy technologies having reached $1.3 trillion dollars last year, according to IRENA, the energy transition challenge of securing enough funding is starting to give way to a much more human obstacle: finding enough skilled trades people.
Looking at the US and Canada specifically: Flagship government policies like the US Inflation Reduction Act—which aims to pour some $370 billion into clean energy projects in addition to private capital—and the much anticipated Canadian Clean Electricity Regulations—with a target of converting Canada’s electricity grid to net zero by 2035—will require hundreds of thousands of skilled trades jobs annually.

Anticipated annual US job creation resulting from the Inflation Reduction Act

Anticipated annual US job creation resulting from the Inflation Reduction Act
Graphic courtesy of Reuters, data courtesy of BW Research

A job created is not necessarily a job filled

Just ask every restaurant and coffee shop with a perpetual “help wanted” sign in its window.

The deets: According to BuildForce, a leading forecaster of the Canadian trade and labour market, the Canadian construction workforce could be short nearly 30,000 people by 2027.

Even Canada’s recently published Sustainable Jobs Plan—a somewhat controversial plan to transition energy workers towards a low-carbon economy—acknowledges that “according to numerous studies, rather than a shortage of jobs, in Canada we are much more likely to see an abundance of sustainable jobs with a shortage of workers required to fill them”.

Canadian non-residential labour force forecast

Canadian non-residential labour force forecast
Courtesy of BuildForce

Tough for Employers, Great for Employees

With labour making up a large portion of construction and operating costs, shortages that lead to higher wages and incentives could impact the profitability of existing facilities, new investment returns, and ultimately the speed of energy transition. It also means there is likely to be stable, attractive employment in the trade and labour market for anyone willing to pick up a wrench and put in an honest day’s work.

  • Full disclosure, our brittle, indolent typing hands realistically couldn’t handle an honest day’s work.

Big picture: Figuring out who is going to actually build these new energy systems is another example of what happens when climate change ambition meets infrastructure development reality.

While there seems to be no shortage of people with fancy degrees and lots of talent between the spread-sheets, energy developers of all kinds—conventional and renewable—are in desperate need of people who know how to construct high-voltage transmission lines, weld pipe, and build scaffolding.

Until more people get themselves through trade school, employers are starting to consider some extreme measures to attract and retain talent. Who knows, maybe they’ll even start letting GenZ pipefitters bring their emotional support dogs into work with them.

+Bonus Reading: Biden’s Climate Agenda Has a Problem: Not Enough Workers

++Bonus Reading: BuildForce Construction & Maintenance Labour Forecast 2022 to 2027