To little fanfare this month, BP closed a solar-cell factory in Madrid, laying off 480 workers. But wait, aren't "green-collar" jobs the wave of the future -- the kind of employment that will only grow and "can't be outsourced," as President Obama likes to say?
Spain happens to be the country that the President often cites as his role model for the Green Jobs Revolution. It's also the source of an important new study that explains how expensive these jobs are -- and why Spain's renewable-energy business is a bubble waiting to burst. The study, released last month by researchers at Universidad Rey Juan Carlos, uses data from the Spanish government and European Union to demonstrate that each job created in Spain's renewables industry costs as much as 2.2 jobs elsewhere in the economy.
The study's authors calculate that jobs in Spain's solar, wind and hydroelectric power industries were subsidized to the tune of more than €570,000 apiece from 2000 to 2008 -- a total exceeding €28.6 billion. And that figure only includes the extra cost to energy consumers of being forced by the government to buy renewable energy at prices several times higher than market rates for conventional power. The authors didn't calculate direct subsidies, such as grants to build solar farms, because the government doesn't even know how much money it has handed out to the renewables industry. But the direct-subsidies tally is at least €1.1 billion.
Some commentators have reported that Spain has lost 2.2 jobs for each job created by solar, wind or hydroelectric power producers. But the study instead is talking about opportunity cost -- the jobs that weren't created because resources were used inefficiently, or what the French economist Frédéric Bastiat meant by "what is seen and what is not seen."
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