Work Force Development in the Electric Utility Sector

Approximately half the electric utility sector workforce will retire in the next 10 years.  This will leave a shortage of experienced workers in every organizational facet, from linemen to power engineers, potentially affecting energy reliability.

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Executive Summary:

Approximately half the work force in the electric utility sector will retire in the next 10 years, leaving a shortage of experienced workers in every organizational facet, from linemen to power engineers. This shortage has the potential to affect energy reliability and innovation across the U.S.

In addition to a shortage of skilled workers in the traditional energy sector, there is a growing need for workers in the green energy sector. As demand for energy is expected to increase, more electric generation facilities will need to be built, which will further widen the demand-supply gap.

Because energy security and reliability are vital to the welfare of a state, it is essential that policymakers get involved in alleviating the work force deficit. State policymakers can therefore play a key role by implementing policies that:

1. Improve K–12 STEM education;
2. Enhance and create postsecondary technical programs;
3. Increase and fund power engineering faculty at universities; and
4. Create a positive perception of the electric utility sector field.

And with an unemployment rate of 10 percent as of January 2010, retraining workers for relatively high paying jobs in the utility sector work force in 18 to 24 months is a key way to get people back on their feet and stimulating the economy.


The Problem

Approximately half the work force in the electric utility sector will retire in the next 10 years, according to the U.S. Bureau of Labor Statistics. That will leave a shortage of experienced workers in every organizational facet, from linemen to power engineers.1 This shortage has the potential to affect energy reliability and innovation across the U.S. In addition to a shortage of skilled workers in the traditional energy sector, there is a growing need for workers in the green energy sector. As demand for energy is expected to increase, more electric generation facilities will need to be built, which will further widen the demand-supply gap.

How does the industry replace those workers and why are there shortages when wages are so competitive? Indeed, according to the Bureau of Labor Statistics, wages are typically higher for electric utility workers than in other comparative utilities. An essential reason for the shortage, according to the U.S. Department of Energy, has to do with inadequate science, technology, engineering and math preparation—called STEM education—at all educational levels, from K–12 to higher education, leaving a dearth of qualified applicants from which utilities can choose.

This brief explores the deficiencies that have led to the shortage of skilled electric utility workers and recommends pragmatic solutions for policymakers to address that shortage. Ensuring an adequate energy work force is one step toward enhancing the nation’s energy security and reliability.

The Challenges

Because energy security and reliability are vital to the welfare of a state, it is essential that policymakers get involved in alleviating the work force deficit. State policymakers can therefore play a key role by implementing policies that:

1. Improve K–12 STEM education;
2. Enhance and create postsecondary technical programs;
3. Increase and fund power engineering faculty at universities; and
4. Create a positive perception of the electric utility sector field.

All four methods are needed to comprehensively address the work force shortage. These are primarily long-term solutions and will not immediately address the need for utility workers.

STEM Education

STEM education is essential to maintaining the competitive nature of our nation and thus, for reasons apart from careers in the electric utility industry alone, it is important for states to enhance and establish STEM programs.

Although U.S. schools have developed a reputation for being inadequate when it comes to STEM education in general, that idea may not be entirely accurate. In the 2007 edition of the Trends in International Mathematics and Science Study, which benchmarks U.S. and international students’ performance in math and science at fourth and eighth grade, found gains in math and scores holding steady in science. The testing showed:

  • 10 percent of U.S. fourth-graders scored at or above the advanced international benchmark in math; seven countries (out of 35 others tested) had higher percentages.
     
  • 6 percent of U.S. eighth-graders scored at or above the advanced level in math, again with seven countries (out of 47 others tested) performing higher.
     
  • The U.S. performs particularly well in science. In 2007, 15 percent of fourth-graders were at or above the advanced level in science. Just two countries—Singapore and Chinese Taipei—performed better.
     
  • In eighth-grade science, 10 percent of students were at or above the advanced level. Just six countries had higher percentages.

But while the U.S. has performed steadily on these kinds of tests, the country faces increased pressure from other nations to prepare more and better STEM students. The top performers in the study remain consistent: Singapore, Hong Kong, Japan, Chinese Taipei and South Korea. Individual states are taking the challenge to improve seriously.

In 2007, the Ohio legislature passed, and the governor signed, House Bill 119, which dedicated more than $200 million in the biennial budget for a STEM education initiative. The funding was divided into several areas: establishing STEM schools (grades 6–12) and  Programs of Excellence (grades K–8); offering scholarships for students to attend Ohio colleges and universities; providing professional development for teachers; and increasing the supply of STEM/foreign language secondary teachers.

David Burns, director of sustainability for the Ohio STEM Learning Network—a partner with the Ohio Department of Education, said the state has five STEM hub sites that serve low-income and minority students. In order to establish a STEM school, the site must have three elements: interest from public schools, involvement from a college or university, and a business or industry committed to working
on the project. The hub brings together all the partners, each of which are heavily involved in setting up how the school will operate. State funding helps establish the school, along with donations from foundations and private partners, while the Learning Network  provides resources and shares best practices. STEM schools are urged to talk about education as an economic development issue, an idea business leaders have embraced.


Source: National Center for Education Statistics, Institute of Education Science, U.S. Department of Education, "Highlights from TIMSS 2007: Mathematics and Science Achievement of U.S. Fourth- and Eighth-grade Students in an International Context." September 2009, p. 16

Postsecondary Technical Programs

Industry also has begun partnering with community colleges to develop associate degree programs that meet the needs of the utility sector in terms of electrical linemen and other blue collar workers. In many of the partnerships, industry provides scholarships to students and also offers first consideration for any job openings to those who successfully complete the program. NSTAR, for example, the largest utility in Massachusetts, partnered with Bunker Hill Community College to offer an associate of science degree in electric power utility technology. At NSTAR, starting salaries range from $22 to $27 per hour, not including overtime, which is a typical part of the job.

The advantages of such a program are that it saves company resources by reducing the amount of training time needed to invest in new employees, allows more individuals to be trained than would otherwise be the case, and ensures students are trained to  appropriate industry standards.  

The 24-month program is also a way to get displaced workers back into good paying jobs in a relatively short amount of time. Work force Development Bureaus can help capture these individuals and place them in the appropriate programs. The American Recovery and Reinvestment Act of 2009 provided nearly $4 billion in funding—much of it formula funding— for the programs that fall under the Workforce Reinvestment Act, such as the Adults and Dislocated Workers Program, which provides career counseling for dislocated
workers and links them with appropriate employers.

Enhancing Power Engineering Faculty

In order to train power engineers—those who design and operate power plants and related power components—it is essential to have the professional educators available to train them. Power engineering faculties across U.S. universities have seen a steady decrease compared to other engineering faculty.

According to a 2006 U.S. Department of Energy report to Congress, power engineering programs lost faculty and domestic students. According to the Department of Energy report, power engineering faculty has decreased by 25 percent. This may be because,  according to the Department of Energy, faculty who leave are often replaced by faculty with other specializations that pull in grants or industry funding. The one counter to the claim that the utility sector offers higher overall wages is that, for its electrical engineers, it does not.2

According to a George Mason University Center for Infrastructure report, electrical engineers specializing in power  engineering earned the least—by as much as $20,000—when compared to other specializations.3 The field also has not been considered cutting edge, and thus faces an additional drawback as top students are typically drawn to more exciting and innovative specializations. This is beginning to change given the growth in renewable energy and alternative energy generating systems and the essential advances in grid technology and storage capacity to make them work. Following the decline in applicants, faculty positions
also have similarly decreased.

Furthermore, according to the U.S. Power and Energy Engineering Workforce Collaborative—a collaboration between industry,  government and academia to address work force challenges in the electric power industry—45 percent of power engineers working for utilities are eligible for retirement within the next five years. Replacing them would require 7,000 new power engineers—and that does not include the expected increase in demand. Yet, the collaborative estimates the U.S. graduates approximately 1,000 undergraduates each year in power engineering and roughly the same number of master’s and doctoral students, an insufficient amount to fill the  deficit and move the field forward. What’s more, there are only 170 power engineering faculty in the U.S. and 27 percent  (or approximately 50 faculty members) of those are expected to retire within the next five years. It is unlikely administrators will fully  replace the faculty lost due, in part, to a lack of available research funding. Because of this, the gap is expected to grow.4

The Workforce Collaborative suggests increasing the availability of research funding to retain faculty and advance much-needed research. Also, it suggests offering scholarships, to domestic students in particular, in the hopes of attracting potential applicants.5

By ensuring a steady stream of funding earmarked for power engineering research and development, state officials can help attract the necessary talent to the field. The industry matches public dollars for the development.

Creating a Positive Perception of the Utility Sector

Finally, it is essential to promote the profession; to brand careers in the power sector as quality careers that impact the nation in  positive ways by sustaining the economy, addressing climate change and other environmental problems, and enhancing national security. And for power engineers, it involves devising solutions to some of the most pressing issues of our time: how to provide safe, reliable and clean power to an ever-increasing population base as natural resources come under increasing constraints, be it manmade constraints such as cap-and-trade plans or natural constraints such as a lack of availability.

The Workforce Collaborative recommends promoting the career from K–12 into higher education by discussing the important role of power engineering in society and by fitting in field trips and other educational opportunities to see power in practice, as well as by incorporating electricity-related components into lesson plans.6

Allocating funding—or identifying public-private partnerships—for public awareness educational campaigns is one way state legislators can help address the image problem the utility sector faces.

Conclusions

In order to reverse the trend of a declining utility sector work force, state policymakers can consider several options that may serve to help ameliorate long-term challenges, thereby ensuring American energy security and reliability. And with an unemployment rate of 10 percent as of January 2010, retraining workers for relatively high paying jobs in the utility sector work force in 18 to 24 months is a key way to get people back on their feet and stimulating the economy.

Sources:
1 "Bureau of Labor Statistics. "Utilities." Career Guide to Industries, 2010-2011 Edition.
2 Ibid, p. XI.
3 Ebert, Michael. “An Emerging Issue We Cannot Ignore: Meeting the Twin Challenges of Education and An Aging Workforce in the Electric Power Industry.” Critical Infrastructure Protection (CIP) Report. November 2006, p. 4.
4 U.S. Power and Energy Engineering Collaborative Workforce, “Preparing the U.S. Foundation for Future Electric Energy Systems: A Strong Power and Energy Engineering Workforce,” April 2009, p. 4.
5 Ibid, p. 4.
6 Ibid, p. 9.

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