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With US coal jobs decimated, groups look to Biden to aid regional transition

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Six trends shaping the industries and sectors we cover in 2021

Six trends shaping the industries and sectors we cover in 2021

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Essential Energy Insights - January 2021


With US coal jobs decimated, groups look to Biden to aid regional transition

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A miner operates a piece of equipment at an underground coal mine in the Illinois Basin. Like the rest of the U.S., the region has been heavily impacted by declines in domestic coal demand.
Source: S&P Global Market Intelligence

The latest data again confirmed what many have long suspected: Former President Donald Trump's promise to put U.S. coal miners back to work was a bust. As President Joe Biden looks to accelerate the energy transition, some groups worry that things could worsen for U.S. coal communities without supportive policies.

From the fourth quarter of 2016 through the fourth quarter of 2020, quarterly average coal employment and production across the U.S. fell 25.2% and 34.0%, respectively, according to an S&P Global Market Intelligence analysis of U.S. Mine Safety and Health Administration data. The top 25 U.S. counties by net average coal employment loss reported 31,495 fewer average coal workers from the fourth quarter of 2012 to the fourth quarter of 2020, a figure equivalent to about 69.8% of the coal jobs lost across the U.S. in the same period.

"It's been devastating," said Rebecca Shelton, director of policy and organizing at Appalachian Citizens' Law Center. "The coal mining industry has been on the decline for decades, and the past few years have been really disheartening because the decline continues and any commitment to address what's happening has been absent."

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While the U.S. Energy Information Administration has been forecasting that coal production will bounce back in 2021, it has also lowered its forecast multiple times. However, the nation's largest coal producer, Peabody Energy Corp., projected flat production for its Powder River Basin mines in 2021 and declining production at its other U.S. thermal coal operations. Arch Resources Inc. recently disclosed details of a plan to decrease its thermal coal production in the U.S.

Counties in the Appalachian region in states such as West Virginia, Kentucky, Virginia, Ohio, Alabama and Pennsylvania took on many of the job losses as power generators' thirst for coal decreased. Illinois counties and Campbell County, Wyo., also saw substantial decreases in average coal mining employment. The MSHA figures do not include many other workers who depend on the coal sector, including contractors, transportation services and other parts of the economy.

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The Just Transition Fund and a team of representatives from U.S. coal communities launched the National Economic Transition Platform to revitalize regions losing coal jobs in 2020. Thirteen organizations behind the platform recently urged the Biden administration to substantially increase federal investment supporting transitioning coal communities.

The Biden administration published an executive order Feb. 1 creating an interagency work group to revitalize coal and power plant communities. The order says plugging leaks in oil and gas wells and reclaiming abandoned mine lands have the potential to "create well-paying union jobs in coal, oil, and gas communities while restoring natural assets, revitalizing recreation economies, and curbing methane emissions."

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Not all are on board for a shift away from coal mining. West Virginia Coal Association President Chris Hamilton wrote an open letter to U.S. Vice President Kamala Harris published Feb. 9 in response to a television appearance in which Harris proposed transitioning coal workers to other industries.

"I would submit that given the coal miner's level of skill and proficiency and the ongoing need for the raw material they produce, that America should not seek to transition them to another career, and in fact, should embrace the vital role they play in powering and building this country," Hamilton said.

However, Utility Workers Union of America AFL-CIO President James Slevin said in a Jan. 27 statement that Biden's task force addresses the reality that its members face "powerful economic forces" that have decreased demand for coal, leading to "economically catastrophic" coal plant closures.

"The challenges in moving beyond the impacts range from difficult to nearly insurmountable for many people," Slevin said.

One problem is that extractive industries often use up a lot of community resources, leaving little room for other sectors, said Brandon Dennison, founder and CEO of West Virginia-based Coalfield Development. Coalfield Development has invested in various economic transition projects as it experiments to find what works and what does not in affected communities.

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For example, Coalfield Development helped start a solar company in West Virginia that has since become an independent, for-profit organization in the region. On the other hand, Dennison said an attempt to start a coffee shop was likely unsuccessful due to a lack of other economic activity to support the business.

"I think the worst possible thing we could do is lie to our communities and tell them that the coal industry can come back to what it was because all the data is clear that it can't and it won't," Dennison said. "The reality is, even when coal boomed in our communities, it still really struggled with poverty. What we need to do is build a whole new economy that works for everybody."

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