The coal industry performs horribly on jobs. In fact, you could say that the modern coal industry is about as anti-jobs as it gets.
Take Virginia, for instance. Earlier this week, Governor Terry McAuliffe vetoed legislation meant to extend a tax credit for coal producers because of how little it did to spur job creation. In fact, despite coal companies claiming more than $573 million in tax credits between 1988 and 2014, coal-mining jobs in the state fell by more than two-thirds in that time period.
“The extension of these tax credits without meaningful reform is inconsistent with these findings,” McAuliffe was quoted as saying.
The coal job-killing trend is not limited to Virginia. A study by researchers at Duke University published in March in the journal Energy Policy found that in the five-year period from 2008 to 2012, the coal industry shed nearly 50,000 jobs in the US, 12 percent of the industry’s total workforce.
Meanwhile, the study found, the natural gas, solar, and wind energy industries added 175,000 jobs
There are a number of reasons for this dramatic decline in coal jobs, and none of them are the phony “war on coal” or any of the coal industry’s other desperate attempts to shift the blame to anything but its outdated product.
Environmental regulations and attempts to rein in greenhouse gas emissions and other pollution have certainly taken a toll, while the great recession that began in 2008 hit the industry particularly hard. The industry’s attempts to increase production while saving money on labor costs by automating the mining process as much as possible, especially when employing techniques like mountaintop removal, have also led to the massive job losses.
But the biggest reason coal is dying – and taking all the coal jobs with it – is that the market has moved on, plain and simple. Renewable energy and natural gas is taking over coal’s market share – and, as we’ve already seen, hiring far more workers than the coal industry is laying off.
Is there any reason to expect the coal industry will ever bounce back? Not really, according to analysts. As Diana Best of Greenpeace writes regarding the anything but rosy future of Peabody Energy, the largest investor-owned coal company in the world:
Since its peak in April 2011, Peabody’s share price has declined approximately 93% in value and continues to drop. Despite Peabody’s confidence that better times are in sight, many prominent analysts believe that coal markets will never bounce back. As Goldman Sachs so gently put it, “Just as a worker celebrating their 65th birthday can settle into a more sedate lifestyle while they look back on past achievements, we argue that thermal coal has reached its retirement age.”
Peabody’s stock is currently trading at $4.45, and the company is hardly alone in its financial woes. Other major US coal companies, like Alpha Natural Resources and Arch Coal, are both currently trading below $1 per share.
A report released this month by the Sierra Club, Rainforest Action Network, and BankTrack found that, while big banks continue to underwrite the global coal industry – to the tune of $70 billion last year alone – the tide is turning. Writing hereon DeSmog, Kevin Grandia reported that, “coal is starting to lose out, with a critical mass of banks in 2014 refusing to finance environmentally destructive coal projects like the proposed mine in Australia’s Galilee Basin.”
Bank of America, for instance, was the largest underwriter of the US coal industry just a few years ago. But last week, BofA announced that it was officially committing to drawing down its investment in the coal operations worldwide.
According to a Bloomberg New Energy Finance forecast, as much as 7 percent of coal energy generation is expected to shut down in 2015, which the forecast calls a “fundamental reduction in coal’s share of the U.S. power mix,” largely due to a new mercury emissions rule taking effect and of course competition from other energy sources.
There is speculation that the “global death knell” rang for coal some time between 2010 and 2012, as twice as many plans for new coal plants were scrapped or delayed in the preceding five years than new plants were brought online.