US clean energy building boom fuels hiring spree

US clean energy developers ended 2024 with a bang, dominating annual capacity additions and pushing large volumes into construction to lock in Inflation Reduction Act tax credits before potential incentive cuts under the incoming Trump administration and Republican-controlled Congress.

More than 73 GW of large-scale solar, wind and battery storage capacity was under construction across the US as of late November, according to S&P Global Market Intelligence data. The American Clean Power Association showed similar data in a December report, citing 77.4 GW under construction entering the fourth quarter of 2024, up from less than 60 GW under construction a year earlier.

The apparent uptick in renewable energy and energy storage construction activity adds further momentum to some of the hottest jobs in the US — despite heightened post-election anxieties over US clean energy policies and markets.

"The clean energy job market is strong," Lesley Hunter, senior vice president of policy and engagement at the American Council on Renewable Energy, told S&P Global Commodity Insights. "In 2025, clean energy will continue to play an important role in bolstering local economies, especially as more clean energy manufacturing plants come online."

Hunter pointed to the US Bureau of Labor Statistics' latest outlook for the US workforce, which estimates wind turbine service technicians and solar photovoltaic installers will be the fastest-growing occupations in the country from 2023 to 2033, growing 60% and 48%, respectively.

"Solar energy, wind energy and battery storage will continue to grow, bringing more jobs with them, while emerging technologies, such as advanced geothermal and advanced nuclear, will foster more high-quality jobs in the years to come," Hunter said.

The US Energy Department's annual Energy and Employment report from August found that 142,000 clean energy jobs were added in the US in 2023, the latest year for the full dataset. That represented 56% of all energy jobs added that year and 5% of all new jobs in the US. Between 2020 and 2023, almost half of all new energy jobs were in clean energy, which accounted for 42% of all energy jobs entering 2024, according to the report.

Clean energy employment is dispersed across the US, led by California, Texas, New York and Florida, the report added.

Labor cost concerns

The Inflation Reduction Act (IRA) prevailing wage and apprenticeship requirements were finalized in June and encourage union labor agreements. Under the IRA, energy project developers can claim an enhanced tax credit or deduction equal to up to five times the law's base incentives if they pay construction workers prevailing wages and use qualified apprentices for a certain percentage of labor hours.

"If you want the full tax credits in the Inflation Reduction Act, you better be paying folks a prevailing wage," Ali Zaidi, the White House national climate adviser, said during an August press call. Zaidi added that 80% of the law's bonus credits, including clean energy production and investment and manufacturing tax credits, are tied to labor standards.

Labor costs, which have been increasing, may have started to plateau, however.

"The costs have increased considerably," said Nick Cohen, CEO of developer Doral Renewables LLC, a subsidiary of Doral Group Renewable Energy Resources Ltd. "At this point, I see the costs pretty steady, not really increasing anymore. I think we've reached the ceiling."

The market has "found equilibrium in terms of need for labor and supply and demand of labor," Cohen added.

There could be increasing competition for clean energy jobs.

"We have heard labor costs, especially in the Northeast, have increased — not only because of prevailing wages but, perhaps more importantly, because of competition with data centers," said Alex Kaplan, principal market analyst at Commodity Insights. "It seems like developers are increasingly competing with the same labor pools as datacenter builders, which is inflating labor costs for both sectors because of a lack of availability."

Solar developers, however, have had a good labor pool, according to Cohen.

"Over the past few years, we have not had any problem finding good labor to build our projects," the CEO said. "A lot of the labor has come from the local workforce, [and] no matter where you are, you can schedule a project to be built really fast with a lot of people, or you can stretch it over time with fewer people."

Clean energy manufacturing

Domestic clean energy manufacturing, ranging from solar panel factories to lithium-ion battery production hubs, is emerging as another significant source of employment.

"As part of that advancement of new manufacturing here in the US, we're seeing job creation," John Hensley, the American Clean Power Association's senior vice president of markets and policy analysis, told Commodity Insights.

In an August report, the association cited 162 new manufacturing facilities announced since President Joe Biden signed the IRA two years earlier, representing roughly 100,000 manufacturing jobs.

"And I think it's important to caveat that those jobs really reflect the sort of in-facility jobs of the people who will be day-to-day making the parts and components and making sure that stuff gets built," Hensley said. "It's an impressive number, but I think it just sort of scratches the surface as to the overall job impact that these new manufacturing plants will have."

Hiring and retention, however, can be a challenge.

"Manufacturing is not fashionable," said Martin Pochtaruk, CEO of solar manufacturer Heliene Inc. "We do have, which is the average for industry these days, 4% or 5% monthly turnover."

For a facility with two manufacturing lines and about 250 workers, that equates to about 10 to 12 new employees every month, Pochtaruk added.

"What this means is that your recruiting and hiring and training is a line of the business because you need to constantly be recruiting," the CEO said. "I don't think that will improve; that is a reality that we have today."

Pochtaruk pointed to "very strong competition" for labor resources, particularly for engineers.

One solution is for manufacturers to work more closely and build long-term relationships with universities to "ensure that you get a stream of candidates," he said.