Environment
12:07 pm
Fri September 14, 2012

Analysis Predicts Decline in Coal Production Could Actually Increase Coal Employment

An analysis out from the West Virginia Center and Policy--a nonpartisan think tank in Charleston--predicts that even while coal production in Central Appalachia declines, employment will rise.

This may sound counterintuitive. But the analysis by Sean O'Leary says that could happen, due to falling productivity. In that case, it would take the same number of miners to mine less coal.

According to the EIA, in 2010, total coal employment in Central Appalachia was 35,408, and those workers mined 184.44 million short tons of coal. And as I mentioned above, the EIA measured productivity as 2.27 short tons per miner hour. Doing the math, that averages out to 2,319.6 hours of mining per miner in 2010. If we assume that each miner continues to average 2,319.6 hours of mining per year, we can reverse the calculation and estimate total employment using the projected coal production and productivity numbers, which I did below.

The numbers O'Leary then lays out show employment gradually rising, from 35,408 miners in 2010 to 45,405 in 2035.

While employment falls along with production in the first part of the projection, employment starts growing again in the second part, as production stabilizes but productivity continues to fall. In fact, there may be 10,000 more coal jobs in Central Appalachia in 2035 than there were in 2010, despite production falling by 100 million tons, because of falling productivity.

The analysis notes that of course, there are lots of factors at play in the coal markets, so this is just speculation. The rise in employment also assumes that it's still profitable for the companies to mine coal, which O'Leary estimates it will be if there's still high demand for the more expensive metallurgical coal (which Kentucky doesn't have large reserves of). The news last week about CONSOL Energy idling their metallurgical coal mines could just be a temporary setback, or could mean the high demand for met coal won't last, either.