Firm structure and demographics of Massachusetts Clean Energy Jobs
In previous posts, I have presented a broad overview of clean energy jobs and energy efficiency jobs in Massachusetts. This post dives a bit deeper, looking at the firm structures for clean energy companies and the demographics of workers in the clean energy industry. Both of these features are important when considering equity of the clean energy economy.
Firm structures for clean energy companies in Massachusetts
The 2017 MassCEC Clean Energy Industry Report identified 109,266 clean energy jobs within Massachusetts. It also identified 6,877 clean energy “establishments,” business locations with at least one employee. As explained by the MassCEC report, “a clean energy firm or business organization (corporation, company, or partnership) can have multiple establishment locations.” Because the report does not provide data on companies, I will use the establishments by clean energy type as a high-end estimate for firms.
The graph below shows the number of companies by establishment size for each of the 2017 MassCEC clean energy categories. Most firms are small, with 3,958 companies that have less than 10 employees and 1,824 companies that have have 11–49 employees. Only 828 clean energy companies in Massachusetts can be considered “large” with more than 50 employees.
With so many small-sized firms, it is difficult to comprehensively track businesses in the Massachusetts clean energy economy. According to the 2017 Clean Energy Industry Report, the MassCEC’s existing database of clean energy businesses only lists 2,207 contacts, less than a third of the estimated number of establishments with clean energy jobs. Clean energy firms are also heterogeneous in the product offerings; only 48% of companies surveyed by the MassCEC report earn all of their revenue from clean energy. This low percentage suggests that many companies counted in the MassCEC survey may not identify as a “clean energy company.”
The clean energy industry’s high percentage of small firms may also explain its low unionization rate. While the MassCEC report does not provide data on union membership rates, the 2017 US Energy and Employment Report from the Department of Energy lists a 4% unionization rate for jobs in renewable energy. This is much lower than the 11% unionization rate for all US jobs.
Equity and Inclusion for clean energy workers in Massachusetts
In addition to firm sizes, the 2017 MassCEC Clean Energy Industry Report also provides information on the demographics of the clean energy workforce. Data on women, minorities, veterans, and older workers is shown below.
The clean energy economy in Massachusetts is far from gender equality. Only 24% of the current clean energy workforce identifies as a woman, even though women make up 49.3% of the full Massachusetts workforce. This number is roughly on par with the current construction industry percentages and is closely aligned with national rates for energy jobs, according to the 2017 USEER. But clearly there is room for improvement. If Massachusetts wants to build an inclusive clean energy economy, it will need to deliberately create opportunities for more women to join the clean energy workforce.
Massachusetts also is lagging in racial diversity in the clean energy economy. While 23.3% of the commonwealth’s workforce identifies as Hispanic or a racial minority, only 11.9% of clean energy workers are racial or ethnic minorities. Because poverty also falls largely along racial lines, this means that the poorest communities in Massachusetts are not receiving an equitable share of the clean energy jobs created in the Commonwealth. Massachusetts will need to find ways to increase the racial diversity of its clean energy workforce if it wants to use climate policy to address inequality.
In addition, Massachustts has a lower percentage of older workers employed in the clean energy economy than average percentage of state workers 55 years or older. This may be due to the physical nature of much of installation and other work conducted in the clean energy economy. However, this is another equity gap. On a brighter note, the clean energy economy employs a greater percentage of veterans (5.3%) than the state average (3.3%).
While firm structure and demographics are important in understanding equity dimensions of the Massachusetts clean energy economy, two other important factors remain: geographical dispersion of jobs and specific job types along the clean energy value chain. I will address both these factors in future posts.
