New report examines job creation plan for a Just Transition in Alberta

At a time when Premier Danielle Smith tries to paint any steps toward a Just Transition as a way to slash jobs in Alberta, a new report by Parkland Institute shows how the workforce transition to a sustainable economy can do the opposite and generate more than 200,000 new jobs in the province by 2050.

Authored by Parkland research manager Ian Hussey, “No Worker Left Behind: A Job Creation Strategy for Energy Transition in Alberta” provides an analysis of an energy transition job creation plan recently published by the Alberta Federation of Labor (AFL), with insights from financial institutions and policy research groups.

A changing economy – Countries around the world are transitioning their economies to reduce carbon emissions and slow the impact of the climate crisis. “Alberta is part of a changing global economy,” says Hussey. “Ignoring those changes and refusing to plan for them will not stop the energy transition — but will greatly impair our ability to adapt to it”.

A significant loss of jobs in the oil industry is already happening in Alberta, with numbers consistently going down since the peak in employment of 2014. From September 2014 through December 2022, the Canadian oil and gas industry cut 19% of its workforce — 43,548 jobs — due to structural changes and increasing automation. About 81% of these job cuts — 35,160 jobs — were in Alberta.

While energy transition isn’t the only reason for this decline, it is certainly part of the equation. “Leading oil and gas companies are speeding up automation to lower production costs by cutting jobs because they know they will soon be competing in a shrinking market,” says Hussey.

Planning for change – An energy transition job creation plan is needed to maximize the opportunities and minimize the traumatic consequences of a disorderly transition, as “a disorderly transition creates a stronger likelihood for job losses and community decline.”

The AFL plan is built around three strategies: maintaining as much oil and gas extraction as possible; transitioning oil and gas production to feedstock for materials manufacturing; and expanding Alberta’s clean-energy economy.

“Alberta’s oil and gas sector could retain at least 100,000 direct jobs in 2050,” says Hussey. That includes 85,000 jobs in hydrocarbon and CO2-based manufacturing (e.g., carbon fibre, asphalt binder, and recyclable plastics). For reference, Alberta’s oil and gas sector employed about 136,000 workers in 2022.

Hydrogen and sustainable fuels such as biofuel could employ an additional 70,000 workers by 2050. The clean electricity sector — primarily through the use of wind and solar power — could generate 20,000 jobs, and 8,000 new jobs can be added in the mining and processing of minerals and metals and the manufacturing of battery cells and components. Finally, the AFL estimates that 14,000 jobs can be created in Alberta’s building-retrofit industry.

Paying for the plan – The report also offers solutions for funding the plan, starting with the return to a 12% corporate tax rate in Alberta. “If we had kept a 12% rate for 2019-2021, then the provincial government would have collected $6.3 billion over this period in addition to the $11.7 billion it received.”

Other measures include higher tax rates for the top 7% of income earners, increased royalties on oil sands production, windfall profit taxes during periods of high commodity prices, and a new federal Just Transition Transfer to provinces and territories.  

“The energy transition will involve some big challenges for Alberta and Canada. But there will be also tremendous opportunities for Alberta workers, communities, and businesses,” says Hussey. “We have many competitive advantages if we plan and act quickly and decisively.”

The report also includes, as an appendix, the proceedings of the Parkland Institute’s 2022 conference “Implementing a Just Transition,” which provided important context and background to the report.

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For the full report, visit https://www.parklandinstitute.ca/no_worker_left_behind 

For more information or to arrange an interview, please contact:

Rita Espeschit
Parkland Institute Communications Coordinator
[email protected]