ENERGY TRANSITION & THE FREELANCE ECONOMY
There’s a “green trade” skills shortage in the renewable energy sector and it could be highly skilled freelancers that could come to the world’s rescue.
Green jobs are growing at around four times the rate of the overall UK employment market, with 2.2% of all new jobs classed as green (PwC). However, more than one-third of these roles are now based in London and the South East, with a dominance of professional and scientific roles. That leaves a massive green trade skills gap.
The global energy transition to a greener world is in dire need of skilled workers who also have the ability to train fellow workers and contractors. But with complicated and costly barriers in the energy, engineering and manufacturing hiring and supply chains, such as IR35, the UK is already hard pushed to meet its net-zero targets.
Green skills shortage
The second edition of PwC’s Green Jobs Barometer found that the number of green jobs advertised in the UK has almost trebled in the last year, equating to 336,000 positions
However, when it comes to job location, Wales and Scotland are among the top performers, it’s striking that one in five new green roles are based in the Capital, said the report
If growth continues on this trajectory, the compounding effect means the green economy will increase London’s dominance over other cities and regions. If we want to meet our Net Zero ambitions while driving growth, then the green economy needs to be nationwide.
“This year’s Barometer shows that many green jobs are in professional and scientific roles, while there is an ever-growing gap in new green trades jobs which are equally vital to net zero plans,” said Carl Sizer, PwC UK’s Head of Regions.
Sizer said that this is not just a story of job creation, but also one that “highlights the critical requirement for upskilling and training to prepare the UK workforce for the jobs that will realise the country’s ambitions.”
This will need significant investment, he said. For example, PwC’s data shows that between 10,000 and 66,000 new tradespeople will be needed each year to retrofit the 29 million homes with low EPC ratings.
The renewable energy sector’s skills shortage could hamper the world’s ability to achieve net-zero emissions, according to Antonio Scala, head of people and organization for Italian utility Enel SpA’s renewables, thermal generation, infrastructure and networks divisions.
Scala told S&P Global Commodity Insights that in the immediate future, companies such as Enel will mainly be hiring from utilities and the industrial sector because the transfer of skills from traditional sectors to renewable energy is more direct.
To meet longer-term staffing needs, “the world needs a skills and training revolution,” said Scala.
IR35 impact on the energy transition
Renewable energy projects can only get off the ground and be completed with a flexible and skilled workforce. That means contractors must not be in limbo by unclear workforce status policies, such as IR35 and Off-Payroll reform, which has cost companies and contractors millions in costs, as previously reported by The Freelance Informer.
Workforces will soon struggle to keep up as installations targets grow, according to the S&P report. When it comes to solar and wind energy, installing panels and turbines, specialist workers work through a “pipeline of projects and move on every few months, often to different countries.”
The report stated that these frontline workers make up 60% of wind power turbine maker and installer Vestas’ head count.
As renewable energy targets swell across the world, the availability of skilled workers risks becoming a bottleneck for deployment said the report. Over the next eight years, the number of people working in the EU wind and solar energy sectors is set to double from today’s 650,000 (SolarPower Europe and WindEurope).
But this might not be enough brain and technical power to get the energy transition to where it needs to be to cut down greenhouse gases. “Everybody is pinching everybody’s workers at the moment,” a union leader said in the S&P report. “There is enormous competition for engineers and skilled workers.”
The wind industry, for example, will start seeing a skills shortfall from 2025, according to Tom Hopkinson, CEO of renewables recruitment agency Taylor Hopkinson Ltd., which fills roles and provides freelance staff for major utilities and developers including Vattenfall AB, Equinor ASA, and Ocean Winds SL, the joint venture between Engie SA and EDP Renováveis SA.
Taylor Hopkinson has recently declined assignments amid a demand surge that is especially pronounced for skilled middle-management project engineers, Hopkinson said in an interview.
Hopkinson, it was reported, is already warning of the implications on project viability and safety:
“What you will see is some very inexperienced people leading some very big projects,” the recruiter said in the report.
Aside from health and safety concerns, this will also raise the cost of project financing as banks price in the higher risk of delivery delays.
The consensus is that companies can only do so much when it comes to reskilling the population to meet the goals of the energy transition.
The first port of call to pinch talent has been in the energy, engineering, construction and manufacturing sectors, but we could see electricians reskill and train, too, helping to meet the green trade skills gap. Governments will have to initiate grassroots skills in school curriculums and career counselling when it comes to GCSE, apprenticeship and A-Level choices. In the meantime, the government must rethink how it can simplify contractor hiring practices without being costly and inhibitive to talent or the companies that are making the energy transition a reality.
Many green trade contractors, including young workers, will be forced to join the unregulated umbrella company industry, which could lead to more challenges the energy transition cannot afford to take on.