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U.S. job growth surges with the IRA

The United States’ clean energy market was growing before the Inflation Reduction Act became the law of the land. Now, clean energy job creation is booming.

Skilled woman fitting a photovoltaic panel

Image via Shutterstock/franco lucato

If you’ve followed coverage of the Inflation Reduction Act (IRA) in the past year, you definitely know this number: $369 billion. Touted by one and all as the amount of money invested in climate action and energy security programs by the law, $369 billion has become a mainstay in IRA discourse.

But $369 billion is no longer the most accurate number to cite, according to the Congressional Budget Office. Its latest calculations increase the total to $391 billion through 2031. Now that the IRA has been the law of the land for one year, it’s not surprising that numbers are transitioning from projected to actualized.

And nowhere is that better illustrated than in job growth. Initially, ranges were largely presented as the result of a decade of the IRA. The Labor Energy Partnership projected 1.5 million jobs created by 2030, and BlueGreen Alliance and the Political Economy Research Institute's report estimated that the bill could produce more than 9 million jobs over the next decade. 

In February, nonprofit advocacy organization Climate Power released a report detailing new clean energy projects across the country, and the total number of energy jobs associated with them, state by state. In total, the IRA had catalyzed 90 clean energy projects across 31 states, creating more than 101,000 jobs.

Climate Power updated the report in July, claiming 272 new clean energy projects across 44 states, creating a total of 170,606 new jobs. And it doesn’t show any signs of slowing down, according to BlueGreen Alliance vice president of industrial policy Ben Beachy.  

Speaking about the projects highlighted in Climate Power’s report, Beachy said, "As [IRA] programs get stood up and federal funds start flowing, those investments will only increase, as well as job creation."

South Korean car company Kia is included in that list of new projects. In July, Kia announced plans to invest $200 million in an assembly plant in Georgia. This facility will focus on producing electric vehicles (EV), specifically the EV9 SUV, Kia’s first EV totally assembled in the U.S. This plant is expected to create an additional 200 jobs. 

Another company on the Climate Power list is American Battery Factor (ABF). ABF announced in December its intention to invest $1.2 billion to build a lithium battery gigafactory in Arizona. Lithium batteries are not only crucial for EVs, but are also vital to building out U.S. storage capacity for solar energy. Lithium battery manufacturers can take advantage of the IRA’s 45X Advanced Manufacturing Production Credit.  

When I asked ABF CEO Jim Ge how the IRA has affected his company, he said, "It really adds more value [to ABF]; it will make us more competitive." ABF believes its new facility will create around 1,000 new jobs once open in 2025.

But the rate of job growth since last August shouldn’t necessarily all be credited to the IRA — at least, not in the 2022 solar sector. "No, we don’t see any immediate effect on solar jobs from the passage of the IRA," said Avery Palmer, communications project director at the Interstate Renewable Energy Council (IREC). "Solar job trends in 2022 were driven by more short-term factors, such as the threat of possible new solar tariffs, current trends in the market, and other more immediate news." 

IREC’s 2022 National Solar Jobs Census, released in July, reports that since 2010, the number of solar jobs has more than doubled, with 3.5 percent growth alone from 2021 to 2022. The U.S. solar industry has been steadily growing for years, so to suggest the IRA as a main catalyst for growth is an overstatement — at least, until 2024.

"In the coming years," said Palmer, "especially from 2024 onward, we do expect to see much more impact from the IRA on job growth." Specifically, Palmer refers to the report's projection that by 2032, solar job totals will exceed 500,000 (as of December, solar energy jobs totaled 263,883).

The IRA isn’t a silver bullet. Entire industries need more than tax incentives to rise or fall. The IRA simply provides the affordable, renewable energy needed to power climate technology’s ascension within the U.S. market. "These new investments offer an opportunity," concludes Beachy, "to build our clean energy future on a foundation of good jobs, clean manufacturing and a more reliable and equitable industrial base."

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