Despite one of the highest levels of employment in recent U.S. history, the traditional energy and energy efficiency sectors continued to outperform the economy as a whole, adding 152,000 new jobs during 2018.

At the same time, however, hiring difficulty was highlighted as a growing problem by virtually all sectors. Just under 77% of employers reported difficulty hiring qualified workers over the last 12 months.

Workers install the blades of a wind turbine. Source: U.S. Air ForceThe findings are part of a report, The 2019 U.S. Energy & Employment Report, by Energy Futures Initiative (EFI) and the National Association of State Energy Officials (NASEO). Former Energy Secretary Ernie Moniz launched EFI in 2017. NASEO is a nonprofit association representing the 56 energy offices of the states, territories and the District of Columbia.

The report said that a number of long-term trends accelerated during 2018, including the continuing growth of the natural gas electric power generation and wind workforces. It said that cost advantages pushed out older coal-fired units. Employment at coal-fired power plants fell by almost 7,000 jobs even as coal fuel jobs grew by 650.

Growth in the oil patch

In the fuels industry overall, oil and gas production added the most new jobs in the traditional energy sectors. The report said that efficiencies and increased prices brought thousands of workers back into the oil and gas fields of Texas, Oklahoma, North Dakota and Pennsylvania. Employment in oil and gas extraction and support services is at its highest level since its recent high in the fall of 2014, the report said.

Roughnecks on a drilling rig in Greely, Colorado. Source: National Institute for Occupational Safety and HealthSolar employment fell for the second year in a row despite the sector adding an additional 11.06 gigawatts of capacity. The decline was concentrated in California, Massachusetts, North Carolina and Arizona. Other technologies that continued to register growth included combined heat and power (CHP) and smaller renewables such as geothermal.

(Read "Solar energy employment fell in 2018, report says.")

Nuclear power generation avoided potential closures in Illinois and New York as a result of favorable state policies, but employment declined by 1,500 jobs.

Energy sector growth

Based on employer data collected in the fourth quarter of 2018, the 2019 report found that the traditional energy and energy efficiency sectors in 2018 employed approximately 6.7 million Americans or 4.6% of a workforce of roughly 147 million.

Employment in these sectors grew in 2018 by 2.3% from the previous year, adding 151,700 net new jobs. That made up nearly 7% of all new jobs nationwide.

The fuels sector employed 1,127,600, an increase of 52,000 or 4.8% in 2018. Petroleum fuels added the most jobs of any traditional energy sector, with 33,500 new positions, an increase of 5.9%. Natural gas extraction increased employment by 6.8%, adding 17,000 jobs. Coal mining and fuels production gained 650 jobs or 0.9%.

(Read "Productivity rises even as coal mines close and demand falls.")

The electric power generation sector employed 875,600 and experienced an employment decline of just under 1%, almost 8,300 jobs. Job losses in solar, nuclear and coal generation were partially offset by gains in natural gas, wind and combined heat and power.

Renewable energy job trends

Solar energy firms employed 242,000 people who were reported as spending the majority of their time on solar. An additional 93,000 employees spent less than half their time on solar-related work. The number of employees who spend the majority of their time on solar declined by 3.2%, or more than 8,000 jobs in 2018.

An additional 111,000 workers were employed at wind energy firms across the nation in 2018, an increase of 3.5% or 3,700 jobs.

Workers install solar panels. Source: U.S. Air Force by Senior Airman Paul LabbeNatural gas-focused employment in electric power generation rose by over 5,200 (4.9%), to reach almost 113,000 jobs. The report said this reflects the fact that gas now produces more electricity in the United States than any other fuel type.

Advanced/low emissions natural gas, wind and CHP generation were the fastest growing new sources, increasing employment by more than 4,500 (7.0%), 3,700 (3.5%) and 2,000 (7.4%), respectively.

Coal-fired generation employment declined by more than 6,600 jobs, or 7.2%.

Energy delivery

Transmission, distribution, and storage (TDS) employed more than 2.3 million Americans, with just over 1 million working in retail trade (gasoline stations and fuel dealers). Excluding retail trade, this represents an increase of 33,000 new jobs or 2.6%.

Utilities and construction were the two strongest industry sectors in TDS, adding over 30,000 new jobs in 2018. Battery storage added over 9,500 new jobs for an 18% growth rate.

Energy efficiency employed 2.35 million Americans, in whole or in part, in the design, installation and manufacture of energy efficiency products and services. The sector added 76,000 net jobs in 2018 (3.4%). Almost 1.3 million energy efficiency jobs are in the construction industry, a 1.6% increase, or almost 21,000, from 2017.

Growth projections

Overall, firms covered by the survey anticipate roughly 4.6% employment growth for 2019. Energy efficiency employers projected the highest growth rate in 2019 (7.8 percent). That was followed by electric power generation (7.1%), TDS (3.2%), fuels (3%) and motor vehicles (2.2%).

Hiring difficulty was highlighted by virtually all sectors as a growing problem. Just under 77% of employers across these sectors reported difficulty hiring qualified workers over the last 12 months, an increase of nearly 7 percentage points from 2017.

Among construction employers in energy efficiency, one of the largest surveyed sectors with over 1.3 million workers, a majority (52%) of employers reported that it was very difficult to hire new employees. This sector also predicted greater than 8% growth in 2019.

(Read "Manufacturing shift is driving down energy intensity.")

Lack of experience, training or technical skills was almost universally cited as the top reason for hiring difficulty by employers across all five surveyed sectors. The need for technical training and certifications was also frequently cited, implying the need for expanded investments in workforce training and closer coordination between employers and the workforce training system.

Deep-dive demographics

The report also said that women are a smaller portion of the workforce in these sectors, ranging from 23% to 33%, compared to the overall economy, where women make up 47% of the workforce.

Two of the energy sectors—Electric Power Generation and Transmission, Distribution and Storage—are more racially diverse than the national workforce as a whole, at 31% and 30%, compared to the national average of 22%.

Veterans comprise from 8% to 11% of these sectors—higher than the national average of 6%.

Between 14% and 23% of this workforce is 55 years of age or older, compared to the national average of 23%; this proportion is significantly lower in Electric Power Generation and Energy Efficiency.